The Energy Department plans to auction about 2,000 megawatts of renewable energy capacity under the proposed Green Energy Tariff Rate Program.
“To encourage RE investors, DoE has already asked NREB [National Renewable Energy Board] to review the concept of giving allocation to renewable energy. DoE will make a green energy tariff rate. We are not giving FIT [feed-in tariff],” Energy Secretary Alfonso Cusi said at the sidelines of the 2019 Pre-Sona Economic and Infrastructure Forum at the Philippine International Convention Center in Pasay City on Monday.
He said the tariff would be auctioned among the renewable energy developers, depending on the type of power that their respective projects are capable of delivering.
“We will put a [price] ceiling, then they compete, offer the lowest. [It is] not per technology, but per type of power, whether peaking or mid-merit,” Cusi said.
He said any RE project could participate in the new program.
“We will allocate [the 2,000 MW capacity]. [It] depends on the energy type,” Cusi said.
He said the NREB would study the program together with industry players.
“The one who will set the ceiling price, NREB will discuss with the players and come up with the recommendation,” he said.
Cusi said the proposed allocation would form part of the government’s power generation capacity building to meet the country’s growing power demand.
“Of course, renewable… as a baseload…cannot compete with the other technologies, the traditional technologies. We’re giving them an allocation where they will be able to work within the avoided cost,” Cusi said.
Cusi said the program would provide RE investors clarity on the way forward for RE development.
“I will not give an expiry. I will give them allocation,” Cusi said.
He said the move was meant to address issues on the end of the feed-in-tariff regime in the RE industry.
Cusi also said the ceiling price of the auction would be lower than the current FIT rates.