The Department of Energy (DOE) is considering a stricter but more streamlined mechanism to reopen terminated service contracts for renewable energy (RE) projects

Energy Assistant Secretary Mylene Capongcol told reporters that the agency is actively monitoring dormant RE projects, including those with delayed timelines of over three years.

These idle developments would eventually be placed under the Open and Competitive Selection Process (OCSP), which is awards new RE service contracts through a strategic bidding system.

Capongcol noted, however, that the DOE has yet to find alternative ways to revive delayed projects, as reallocating contracts still falls under OCSP, which is reportedly a lengthy process.

“We don’t have OCSP for solar [projects]. What I’m saying is that we might need a mechanism that doesn’t require OCSP, but just to declare to the public that these areas have been terminated…The mechanism or the details have yet to be explored,” she said.

Solar energy service contracts are given a two-year window for their pre-development phase; however, if a developer fails to submit the declaration of completion (DOC) or show any progress within the specified timeframe, the DOE’s Renewable Energy Management Bureau (REMB) will release a show-cause order.

Those that have been considered as force majeure will be granted with potential extension; however, insufficient reason for falling behind schedule will result in termination.

According to the DOE official, there are approximately 1,400 awarded service contracts in operation, representing around 130 gigawatts (GW) of capacity, with some recently granted and others terminated.

“We should be able to at least remove the barriers in the RE development, so that we can make use of the available space and increased capacity in RE, so that we can also sustain our requirements,” she said. “[But] we’re not saying that RE will solve everything as far as the power supply [is concerned]. At least we’ll be able to sustain the local or indigenous supply.”

Capongcol assured that the DOE remains active in monitoring the performance progress of these contract holders, as every winning bidder under the Green Energy Auction Program (GEAP) has a specified timeline and committed delivery date.

“We’re active now in monitoring termination. We’re enforcing dues on projects that have been dormant for too long, so we’ll have to wake them up... Usually, our general policy is if it’s terminated or relinquished, we do the OCSP.”

She added that those deemed terminated will have the opportunity to open up for other developers as well, through an IT platform that the DOE will develop to connect them with the private sector.

“If they have the possessory right or permits… But usually the OCSP is for geothermal, hydropower, and wind [power plants].”