November 23, 2017 | MANILA, PHILIPPINES

Review hopes to resolve issue of solar power generators locked out of FiT

THE review of the country’s feed-in-tariff (FiT) system by yearend will also cover the resolution of the “stranded” solar power capacity, the Department of Energy (DoE), said, with the policy of encouraging of the growth of renewable energy continuing until the end of 2017.

Mario C. Marasigan, who heads the DoE’s renewable energy management bureau, said existing rules call for the review of the FiT system three years after the imposition of the FiT allowance, a uniform rate billed to all electricity users.

“Will there be a new installation target? That will depend on the review and assessment being conducted by NREB (National Renewable Energy Board) and DoE,” he told reporters, referring to the body that sets the direction for renewable energy in the country.

The review is also timed to coincide with the deadline for developers to subscribe to the installation target set by the department for solar, wind, biomass and run-of-river hydro energy capacities.

“We’re now setting a new environment for renewable energy,” he said.

Mr. Marasigan said NREB has created a technical working group to review why the installation targets for solar and wind were fully taken up while those for biomass and hydro remained undersubscribed.

For solar, he said a new installation target or an extension of the feed-in-tariff are not likely considering that a bilateral power supply agreement had been forged for P4.69 per kilowatt-hour (kWh), or way below the FiT rate under the 500-megawatt (MW) installation target.

He said the bilateral agreement could be used “as an avenue to declare that solar has reached grid parity.” He questioned the need for a solar FiT when the technology is already competitive in the market.

Under the solar installation target, solar projects were built on the prospect that they will get a rate of P9.68 per kWh during the first phase of the FiT incentive scheme, and a rate of P8.69 per kWh during the second phase.

The scheme ended in March 2016 in what the industry called a “race to FiT” that saw the 500-MW target oversubscribed by about 360 MW. Many of the “stranded” solar farms without a guaranteed FiT were built in Negros where the transmission facility is unable to carry the new power capacity.

Mr. Marasigan said the yearend review should also answer why there was undersubscription for biomass and small hydro-power facilities.

Asked whether the FiT for the two renewable energy technologies would be extended, he said: “We cannot commit on anything at this time [because] our assessment is not complete. Nonetheless, were looking at other options.” -- Victor V. Saulon