Friday, December 29, 2017

Cusi: Clean Energy Renewable Portfolio Standard Will Not Result in Higher Rates for the Consumers

Wazzup Pilipinas!

The pursuit towards clean and renewable energy (RE) will not burden electricity consumers. This is the assurance of Energy Secretary Alfonso G. Cusi to the energy family and industry players.

“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,” Sec. Cusi pointed out.

“The DOE, after consultations with consumer groups and industry players, clarified this policy and placed the ‘no higher rates’ condition in the Department Circular itself,” Cusi emphasized.

The energy chief said that the DUs and other mandated participants shall undertake a Competitive Selection Process (CSP) in sourcing their compliance to ensure the “no higher rates” policy. Moreover, the DUs have the obligation to look for the optimal supply mix and ensure a level playing field among the power developers. Essentially, all the RE options available (like encouraging Net-Metering installations and implement the Green Energy Option program that empowers a customer to choose RE as part of its supply) should be explored.

According to Sec. Cusi, 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.

Following a laborious technical studies and public consultations since 2011, the Circular on RPS for On-Grid Areas also contains the following safeguards:

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

2. The minimum RE sourcing will not be imposed immediately but on the third year (2020) considering 2018 and 2019 as transition years only to prepare the mandated participants in developing their compliance plans to the minimum RPS requirements; and,

3. The RPS also entails the timely and rigorous review and assessment by the DOE through a composite team.

Sec. Cusi recently signed the Department Circular that prescribes the rules and guidelines in the establishment of Renewable Energy Portfolio Standards (RPS) for On-Grid Areas on 22 December 2017. Department Circular No. DC2017-12-0015 mandates distribution utilities (DUs), retail electricity suppliers including those power generation companies serving directly-connection customers to source or produce a certain percentage of their electricity requirements from eligible RE resources.

The Circular provides that eligible RE participants may use the following resources and technologies: 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.

“A regular review process on RPS will be conducted by the DOE to ensure the compliance all the participants to the RPS, determine the impact to the consumers and whether the imposed minimum RE generation requirement should continue or be adjusted upon accordingly.”

Sec. Cusi also stated that 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.

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