DOE offers 20-year RE supply contract

Published May 24, 2022, 2:36 PM

by Myrna M. Velasco

The Department of Energy (DOE) will be offering 20-year power supply contracts to the winning bidders of renewable energy (RE) capacity projects to be conducted next month under the green energy auction program (GEAP).

In the terms of reference (TOR) issued by the DOE, the winning bidder will supply RE power for 20 years, “provided that it shall not go beyond the term of the RE contract.”

On June 17 this year, the DOE will conduct bidding for aggregate 2,000 megawatts of RE capacities – covering 130 megawatts of hydro capacities for Luzon and Mindanao grids; 230MW of biomass for Luzon, Visayas and Mindanao grids; 1,260MW of solar that will also be sited across Luzon, Visayas and Mindanao grids; and 380MW of wind farm developments for Luzon and Visayas grids.

The energy department specified that the commencement date for the delivery of the contracted RE capacities shall be from December 26, 2022 until December 25, 2025, which means that RE facilities shall achieve commercial operations within these prescribed periods.

The registration of qualified RE suppliers that can join GEAP had been initially slated on May 21-24 this year. The DOE will be posting the qualified bidders on May 31 this year. The department has not given pronouncements yet if the timelines will change.

“The filing of registration of qualified suppliers shall be conducted for a period of 10 calendar days, which shall commence on the date that will be specified,” the DOE stressed.

As part of the pre-bid evaluation process, the energy department indicated that “the Green Energy Auction – Bids Evaluation and Awards Committee (GEA-BEAC), through its technical working group shall evaluate the registration documents within five (5) working days from the last day of registration.”

The conduct of the RE auction had been largely hinged on the issuance of the green energy auction reserve (GEAR) price that the Energy Regulatory Commission (ERC) has committed to finalize on or before May 30.

The DOE emphasized that if the RE auction will push through as targeted on June 17, the award of contracts to the winning bidders will be by June 24 this year, or six days before the exit of the Duterte administration.

The bidding of RE capacities is in line with the state-supported Renewable Portfolio Standards (RPS), which serves as an alternative market for the next wave of RE projects that will be developed in the country.

The DOE said the auction “will be done through an electronic bidding platform where qualified bidders shall gain access to their bid submission interface using a user-specific ID to be issued to the authorized representative of each qualified bidder.”

The GEAP-TOR further noted that “bids with a price offer higher than the prescribed GEAR price shall be discarded automatically for being non-responsive.”