ERC approves FIT-All rate increase; consumers electricity bills to rise soon

The Energy Regulatory Commission (ERC) has approved an increase in the Feed-in Tariff Allowance (FIT-All) rate, which will soon take effect on the electricity bills of on-grid consumers.

In a statement on Saturday, Feb. 22, the ERC said it greenlit a FIT-All charge of ₱0.1189 per kilowatt-hour (kWh), which is higher than the current collection of ₱0.0838/kWh.

This adjustment is intended to cover the costs associated with integrating renewable energy (RE) sources into the national grid.

The rate movement would begin in March 2025, following the regulators’ decision on the rates requested by the National Transmission Corporation (TransCo).

“During its regular commission meeting on Feb. 19, the Commission approved a rate lower than the ₱0.1220/kWh applied for by TransCo, but higher than the current ₱0.0838/kWh FIT-All being collected from on-grid consumers,” the ERC said.

According to the ERC, the increase in charges can be attributed to the low prices in the Wholesale Electricity Spot Market (WESM), which in turn, depleted the FIT-All fund.

“The lower-than-expected WESM prices adversely affected the fund’s capacity to cover the FIT payments, necessitating adjustments in the FIT-All computation to ensure payments for the supply to consumers coming from RE FIT-eligible power plants,” the ERC stated.

Furthermore, the regulators explained that the revision of TransCo’s initial FIT rates was done to reflect the actual electricity generated from RE sources from January to December 2024 instead of the state-run transmission corporation’s forecast, which hit nearly ₱14 billion.

“The FIT differential, representing the difference between FIT rates payable to RE and Wholesale Electricity Spot Market (WESM) prices, was revised from TransCo’s forecast of ₱13.6 billion to ₱10 billion,” it added.

The ERC noted that the calculations for the administration allowance and disbursement allowance were based on actual expenses last year rather than utilizing TransCo’s predicted amount to ensure that the rates to be charged to consumers are “fair, transparent, and reflective of actual market conditions.”