NREB forms panel to act on feed-in tariff issue for solar

MANILA, Philippines - The National Renewable Energy Board (NREB) has formed a committee to resolve issues concerning the feed-in tariff (FIT) scheme for solar, its top official said.

NREB chairman Jose Layug said the committee has started discussions on alternative solutions for the stranded solar projects after the second round of FIT for solar ended last March 2016.

 “At the NREB level, we created a committee whose primary task is to generate options for the stranded (solar) and those options, once vetted at the committee level, will be approved by the board and endorsed to the DOE secretary,” he said.

FIT is a set of incentives given to power developers for a period of 20 years to invest in the more expensive renewable energy sector.

However, the solar industry is hanging because of controversies surrounding the second round of FIT for solar (solar FIT-2) that resulted in over 300 megawatts (MW) of stranded projects to which solar developers have been asking the government to include the overcapacity in the FIT system.

In that round, qualified developers in the 500 MW were supposed to receive a P8.69 per kilowatt-hour (kWh) fixed rate for 25 years.

Among the initial solutions brought up by the NREB committee was conducting a new round of bidding for the new price.

“Some of them have said they still want the original price, but well, the (DOE) secretary already said no to that,” Layug said.

The other two alternatives are using the marginal cost or aligning the rate with current price contracted to the Manila Electric Co. (Meralco), he said.

“The marginal cost, meaning at what price can they continue to operate without shutting down. Or maybe the current price signed by Meralco, which is P4.69 per kilowatt-hour (kwh). The secretary might be inclined to grant it provided it’s current rate. But we don’t know, we will endorse it to him,” the NREB official added.

Solar players, led by the Philippine Solar Power Alliance (PSPA), have long been seeking for transparency in the validation process and a thorough investigation on those that supposedly qualified for FIT perks.

Under DOE Secretary Alfonso Cusi’s watch, the agency launched an investigation on the controversies surrounding the solar FIT-2 race.