DEPARTMENT of Energy Secretary Alfonso G. Cusi has assured that clean and renewable energy (RE) will not burden electricity consumers.
Cusi made the assurance in light of his signing of a Department Circular (DC) that prescribes the rules and guidelines in the establishment of Renewable Energy Portfolio Standards (RPS) for On-Grid Areas on Dec. 22, 2017.
“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 DOE, after consultations with consumer groups and industry players, clarified this policy and placed the ‘no higher rates’ condition in the Department Circular itself.”
The circular, 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 of 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,” Cusi said.
He said 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 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 percent RE share in the energy mix by 2030, which will be reviewed under the forthcoming updating of the National Renewable Energy Program;
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.
Cusi also stated that a holistic information, education and communication 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 issuance of the DOE. p: wjg