Philippines: ERC inaction on FIT-All rates application results in P6.6-B debt to RE developers

Philippines: ERC inaction on FIT-All rates application results in P6.6-B
debt to RE developers

SENATOR SHERWIN GATCHALIAN HAS WARNED THE ENERGY REGULATORY COMMISSION (ERC)
THAT THE PHILIPPINES WILL NEVER GET SERIOUS RENEWABLE ENERGY INVESTORS DUE
TO THE P6.6 BILLION THE GOVERNMENT OWES RENEWABLE ENERGY PLAYERS UNDER THE
FEED-IN-TARIFF (FIT) SYSTEM.

This includes P230 million in interest payments from the ERC's inaction on
the National Transmission Corp.'s (TransCo) application to collect higher
FIT-allowance rates last year.

"I hate to say it, but because of the delays of ERC, we will be paying Php
230 million in interest payments.I know that the amount will grow bigger.
Every day it piles up," he said.

"In line with attracting investors and promoting RE. we will never get
serious investors if we don't fulfill our contractual obligations, and
FIT-All is one of them," added Gatchalian, who is also the chairman of the
Senate Committee on Energy.

"These unwarranted delays in the ERC approval is the reason why Transco has
not been able to pay the RE developers. And because of these delays, we have
to pay consequential costs," Gatchalian said.

In December 2015, TransCo filed an application to increase the FIT-All rate
by 12 centavos per kilowatt-hour for 2016 to boost the subsidy for RE
developers and allow them to pay their obligations.

TransCo previously had a FIT-All rate of P4.06 centavos per kwh.The firm
applied for another FIT-All increase in the 2017 rate for 22 centavos per
kwh before the ERC gave its decision on the proposed 2016 rate.

ERC officials told the members of the Joint Congressional Power Commission
that it will hand its final approval of the 2016 application on June 9. A
May 15 date has been set for the first jurisdictional and expository meeting
for the 2017 rate application, and will hand final approval by September.

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Link to Original Article:
http://powerphilippines.com/2017/05/15/erc-inaction-fit-rates-application-re
sults-p6-6-b-debt-re-developers/

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John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com