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Manila Bulletin devider Business devider Trade & Industry devider ERC raises green energy charge to avert developer default

ERC raises green energy charge to avert developer default

Published Oct 20, 2025 02:18 pm
The Energy Regulatory Commission (ERC) has approved an increase in the Feed-in-Tariff Allowance (FIT-All) rate, starting next month, which will slightly raise power bills to generate sufficient funds for paying renewable energy (RE) developers.
In a briefing on Monday, Oct. 20, ERC Chairperson Francis Saturnino Juan stated that the new FIT-All rate is ₱0.2073 per kilowatt-hour (kWh), higher than the ₱0.1189/kWh charge implemented last March. This adjustment will take effect in November.
FIT-All is collected from consumers to support RE developments such as solar, wind, and small hydropower plants, as the recent spike has been applied for by the National Transmission Corp. (TransCo).
Juan described the commission’s approval of the new rate as difficult decision, as the remaining reserve funds for the allowance are already running low.
“We have a buffer for the working capital allowance. If there are any shortfalls, that’s where we will get [money to pay RE developers]. However, as it is currently depleting based on our analysis, the current fund from TransCo is not enough to pay them back,” he explained.
“So if we can’t pay the FIT-eligible plants in full for the electricity they generate, what will happen is there will be a claim of interest that will be added through the FIT-All, and will be added in the future when we set the [new allowance].”
Despite this, the ERC chair assured that the rate would not see any further increase, as there is a decreasing demand for electricity. He hoped that the cooler weather and zero supply disruptions would soften the price impact.
The new rate would pay ₱19.06 billion FIT differential and be able to build the ₱3.74 working capital allowance. According to TransCo’s report, around ₱215 billion, or approximately 97.6 percent of FIT obligations, have been settled.
According to Sharon Montaner, ERC’s director for market operations, there is still ₱3 million worth of buffer left in the working capital allowance.
Moreover, the ERC has requested an immediate audit of all parties involved in FIT-All, including grid operators and power distributors.
This allowance would further encourage more clean energy investments, while reducing reliance on imported energy sources.
In other news, the ERC has also been proactive in other rate changes, particularly with the Philippine Wholesale Electricity Spot Market (WESM).
The commission has recently set the rate at ₱0.0071/kWh, which will fund daily market operations, administrative functions, and capital expenditure projects, such as critical IT and cybersecurity retrofitting, for the years 2025 to 2027.
Juan also believed that the approved decision would support price stability and reliable delivery of power.

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Energy Regulatory Commission (ERC)
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