The Energy Regulatory Commission (ERC) has rejected adding the proposed “green energy pricing” to the degressed feed-in-tariff (FIT) as it will reportedly result in more costs that will burden the consumers.
Chief of the Renewable Energy Division of the ERC Sharon Montaner said the regulatory body will instead conduct its own study before coming up with a formula for the proposed “green energy tariff,” as reported in a Manila Bulletin article.
The said pricing system will compensate the greenfield RE ventures that will be developed through the Renewable Portfolio Standards (RPS) policy instituted by the Department of Energy (DOE).
Montaner explained that if the reduced FIT-rates will be adopted, it will be very expensive for the consumers these were based on rates eight years ago, which was at ₱8.69 per kilowatt-hour (kWh) and ₱7.40 per kWh for solar and wind respectively.
“The rates where the degressed solar and wind FITs were anchored were still based on 2012, so these were high. Any decrease in the cost of the technologies will not be captured,” she stressed.
She also noted that “there had been no degressed FITs for solar and wind,” as these two have higher FIT rates imposed for the higher installation caps set for thee two technologies.
Run-of-river and biomass were the only ones with the degressed FIT rates. The reduced tariff is around at ₱6.5959 per kWh; and hydro at ₱5.8705 per kWh.
The FIT is a form of subsidy for the development of RE projects and is paid by consumers and collected via electric bills.