Senator Sherwin Gatchalian has warned the Energy Regulatory Commission (ERC) that the Philippines will never get serious renewable energy investors due to the P6.6 billion the government owes renewable energy players under the feed-in-tariff (FIT) system.
This includes P230 million in interest payments from the ERC’s inaction on the National Transmission Corp.’s (TransCo) application to collect higher FIT-allowance rates last year.
“I hate to say it, but because of the delays of ERC, we will be paying Php 230 million in interest payments…I know that the amount will grow bigger. Every day it piles up,” he said.
“In line with attracting investors and promoting RE… we will never get serious investors if we don’t fulfill our contractual obligations, and FIT-All is one of them,” added Gatchalian, who is also the chairman of the Senate Committee on Energy.
“These unwarranted delays in the ERC approval is the reason why Transco has not been able to pay the RE developers. And because of these delays, we have to pay consequential costs,” Gatchalian said.
In December 2015, TransCo filed an application to increase the FIT-All rate by 12 centavos per kilowatt-hour for 2016 to boost the subsidy for RE developers and allow them to pay their obligations.
TransCo previously had a FIT-All rate of P4.06 centavos per kwh.The firm applied for another FIT-All increase in the 2017 rate for 22 centavos per kwh before the ERC gave its decision on the proposed 2016 rate.
ERC officials told the members of the Joint Congressional Power Commission that it will hand its final approval of the 2016 application on June 9. A May 15 date has been set for the first jurisdictional and expository meeting for the 2017 rate application, and will hand final approval by September.