Renewable energy development not likely to push up power rates – Cusi

MANILA, Philippines — Energy Secretary Alfonso Cusi said the pursuit toward renewable energy (RE) development would not result in higher power rates.

He said the agency is implementing safety nets in the form of the Renewable Portfolio Standard (RPS) policy.

“The RPS for on-grid rules outlined various safety nets to protect the electricity end-users and to ensure that this new venture will not result in higher electricity rates,” Cusi said.

The Energy chief signed Department Circular DC2017-12-0015 which prescribes the rules and guidelines in the establishment of RPS for on-grid areas.

The circular mandates distribution utilities (DUs), retail electricity suppliers including power generation companies serving directly-connection customers to source or produce a certain percentage of their electricity requirements from eligible renewable energy resources.

It also provides that eligible renewable energy participants may use biomass, waste-to-energy technology, wind energy, solar energy, run-of-river hydroelectric power systems, impounding hydroelectric power systems, ocean energy, and geothermal energy, among the other systems as defined in the RE Act.

The RPS for on-grid areas is initially anchored on the country’s aspirational target of 35 percent RE share in the energy mix by 2030, which will be reviewed under the forthcoming updating of the National Renewable Energy Program (NREP).

The DOE said the minimum RE sourcing would not be imposed immediately, considering 2018 and 2019 as transition years only to prepare the mandated participants in developing their compliance plans to the minimum RPS requirements.

Cusi also said a holistic information, education and communication (IEC) campaign and hands-on training will be undertaken to guide the DUs and other relevant stakeholders with an aim to impart various developments in the implementation of the policy and the other pertinent policy issuances of the DOE.

To further protect consumers, the RPS policy will also be complemented by the Competitive Selection Process (CSP) policy, which requires all DUs and other mandated participants to undertake competitive bidding in sourcing their compliance to ensure the “no higher rates” policy.

Cusi said the requirement to comply with the CSP ensures a transparent mechanism that ascertain least cost procurement of power supply and ensure competition among the players.