ERC ready to approve minimum prices for RE auction

Published May 20, 2022, 3:09 PM

by Myrna M. Velasco

ERC ready to approve minimum prices for RE auction


The Energy Regulatory Commission (ERC) sounded off that it will beat the May 30 timeline set by the Department of Energy (DOE) for the approval of the green energy auction reserve (GEAR) prices, which will serve as the “minimum price offers” for bidders of renewable energy (RE) capacities next month.

According to ERC Chairperson Agnes T. Devanadera, public consultations required in firming the GEAR prices on the specified RE technologies had already been concluded, paving the way for its issuance on or before the end of this month.

The DOE recently announced that it is scheduling the bidding of initial 2,000 megawatts of RE capacity by June 17 this year as part of the mandated industry participants’ compliance to the Renewable Portfolio Standards (RPS) being instituted in the RE sector.

The energy department qualified though that the slated RE capacity tendering will only be concretized if the ERC would already decide on GEAR prices on or before May 30 this year.

The targeted capacities for auction will be spread across Luzon, Visayas and Mindanao grids; and of varying RE technologies, including solar, wind, hydro and biomass installations.

The preliminary GEAR tariffs set by the ERC per RE technology had been at: P3.6248 per kilowatt hour (kWh) for solar; P5.2887 per kWh for wind; P5.5480 per kWh for biomass; and P5.8705 per kWh for run-of-river hydro.

Devanadera indicated that the GEAR prices shall be enforced per technology – and it will not be a “one-rate-for-all” as raised by intervenor National Association of Electricity Consumers for Reforms Inc. (Nasecore) during the Commission’s deliberations of that tariff-setting.

The ERC chief noted that the leaning of the regulatory body on prescribing a reserve price per technology had been aligned with the policy laid down by the DOE for the Green Energy Auction Program (GEAP).

“There were issues that had been hurled at us by the intervenors – they’re questioning because in their view, it should have been one rate for all technologies. But as we all know, it has been the DOE that came up with the policy to have separate rates per technology, and that’s what the ERC is implementing,” she said.

Devanadera expounded in the legal questions raised by relevant parties on the DOE policy relative to the RE auction, it shall not be the ERC rendering a ruling on that. Instead, such cases must be elevated to the regular courts.

“It shouldn’t be the ERC looking into the legal issues and coming up with a decision that will be questioning the policies of the DOE; that is not within the authority of ERC… the relief for those who would like to question the very policy or issuance of the DOE should go to the ordinary courts,” she stressed.