NGCP given more time to finish feed-in tariff rules

MANILA, Philippines - The National Grid Corporation of the Philippines (NGCP) has secured the approval of the National Renewable Energy Board (NREB) to extend the deadline for the release of the feed-in tariff (FIT) rules to May 16 this year.

NREB chairman Pedro Maniego said NGCP, the operator of the country’s power transmission grid, has requested an extension to enable it to “submit absorptive capacity study for RE (renewable energy) sources.”

He said they deem the study as necessary for the proper implementation of the FIT.

“The DOE (Department of Energy) needs this study to determine installation targets which must be included in the FIT petition. NREB approved the NGCP request and wrote ERC (Energy Regulatory Commission) to extend the FIT petition submission deadline to May 16, 2011,” he said.

According to Maniego, there is a need for the NGCP and the DOE to determine the RE capacity in the first three-year initial implementation of the FIT.

The NREB official said there is also a request from several RE alliances to defer submission of the FIT petition to give them time to evaluate the preliminary FIT rates proposed by the NREB technical committee. “The extension also addressed their concerns,” he said.

Energy Secretary Jose Rene Almendras echoed the need to extend the deadline for the FIT rules implementation.

“It will be difficult to carry it out on the earlier approved deadline (March 31). There is this grid-impact study question. I think the determination of the feed-in tariff will not be a problem as far as finding the right price. The problem will be the target, the cap. That will now be directly influenced by the study we asked the grid corporation to do,” he said.

Almendras said he is confident that they would still meet the deadline of the middle of this year for the FIT implementation.

“Maybe a one or two-week delay in the submission can be accommodated for the promises we made for the mid-year decision for the ERC.”

FIT is a structured rate to be charged by RE developers that would guarantee their returns over a 15-year period. The FIT will be paid by electricity consumers connected to the transmission or distribution networks through a uniform pesos/kWh charge to be known as the FIT Allowance (FIT-All), the implementation of which is similar to that of the present universal charge.

Starting with the effectiveness of RA 9513 or the Renewable Energy ACT, the total additional power capacity from new RE projects envisioned to be installed within the next five years now runs at 1,636 MW.

Proceeds from the FIT, through a so-called renewable energy charge (REC) will be administered by a fund manager, most likely the NGCP.