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Friday, March 29, 2024

ERC sets cap on prices of green energy

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The Energy Regulatory Commission set the Green Energy Auction Reserve prices for solar, wind, biomass and run-of-river hydro technologies in support of the government’s thrust to accelerate the development of renewable energy.

ERC chairperson Agnes Devanadera said the GEAR prices would serve as the ceiling prices for the first round of the Green Energy Auction Program to be conducted by the Department of Energy.

The DOE plans to auction 2,000 MW of RE capacity under the GEAP by June.

“We have set the GEAR prices for each type of technology consistent with the notice of auction of the DOE setting the auction capacities on a per technology basis, and using the discounted cash flow model with 46 parameters and assumptions for each technology,” Devanadera said in a statement.

The ERC set the GEAR price for solar at P3.6779 per kilowatt-hour, wind at P6.0584 per kWh, biomass at P5.0797 per kWh and run-of-river at P5.4913 per kWh.

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The ERC said it is tasked under the Electric Power Industry Reform Act of 2001 to allow the recovery of prudent and reasonable economic costs incurred, consistent with the declared policy to ensure transparent and reasonable prices of electricity in a regime of free and fair competition and full public accountability to achieve greater operational and economic efficiency and enhance the competitiveness of Philippine products in the global market.

“In the determination of a representative project and the computation of the GEAR Prices, the commission was guided by the principle of efficiency and international benchmarks to ensure that only the cost of efficient plants will be passed on to consumers,” Devanadera said.

The regulator said it considered the stakeholders’ comments, inputs and concerns before and after the public consultation on April 12.

The GEAP is a new market development support program introduced by the Department of Energy to promote RE as one of the country’s primary sources of energy through the transparent and competitive selection of RE facilities.

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