Consumers face higher power charges in July after the Energy Regulatory Commission approved an increase in feed-in tariff allowance or the fund pocketed by renewable energy developers.
The ERC approved an increase in FIT All for 2017 from P0.1830 per kilowatt-hour to P0.2563 per kWh. “What is being added is only an increment of P0.0733 per kWh which represents the increase from the current FIT-All rate,” it said.
The fund is collected by state-run National Transmission Corp. on behalf of renewable energy developers. The new rate will be implemented in June and be reflected in the bill of customers in July.
The approved rate was higher than what TransCo applied for at P0.2291 per kWh, which it later revised to P0.2481 per kWh covering the January 2017 billing period.
The ERC, in its computation, used the actual level of the deficit of the FIT-All fund at P4.428 billion in deciding on TransCo’s application, compared to the P3.576-billion deficit estimate of TransCo. This explains the higher approved FIT-All rate.
TransCo manages the FIT-All rate that is used to pay the eligible renewable energy developers under the FIT system, an incentive scheme that gives priority to connections to the grid, priority purchase and transmission of, and payment for, generated and fixed tariff for not less than 12 years to be determined by the ERC.
The ERC approved the tariff rates for solar 1 at P9.68 per kWh, solar 2 at P8.69 per kWh, wind 1 at P8.53 per kWh, wind 2 at P7.40 per kWh, biomass at P6.63 per kWh and hydro at P5.90 per kWh.
“I thank the ERC for their action in approving it. We can somehow address the backlog on the payment of FIT All. The backlog is almost P8 billion and we want to help both consumers and renewable energy developers not to be burdened by reason of the delay in paying of the FIT. [We are] looking forward for the immediate resolution of our 2018 FIT all rate application,” TransCo president Melvin Matibag said.
The regulator said the approved rate of P0.2563 per kWh covered the FIT differential for 2017 based on actual billing amounting to P13.8 billion and the 2016 under-recovery of P4.4 billion reflected in the books of TransCo.
It said the approved rate also covered the disbursement allowance paid to Land Bank of the Philippines and the Bangko Sentral ng Pilipinas for supervision fee of P1 million and the working capital allowance requirement of P1.9 billion.
The commission, however, rejected the proposal of TransCo for the administration allowance amounting to P5 million for 2017 as the composition of the FIT-All team was not yet permanent.
The approved rate also excluded interest charges which reached P527 million, or 195 percent higher than the January 2016 interest level when the commission approved the P0.1830 per kWh 2016 FIT-All rate.
The ERC said the approved FIT-All rate was already sufficient to cover the obligations of TransCo.