Senator Sherwin Gatchalian on Wednesday asked distribution facilities to contract more renewable energy for the benefit consumers amid the prevailing global energy risks.
“This is a significant increase in utilization and should prompt distribution utilities to consider contracting more renewable energy to deter fuel pass-through amid wild fluctuations in fuel prices,” Gatchalian said.
Gatchalian made the call after the Department of Energy decided to increase the percentage of the utilization of RE for on-grid areas to 2.5 percent from 1 percent.
The increase in RE utilization will take effect next year under Department Circular No. 2022-09-0030, which prescribes the adjusted annual percentage increment for all participants of the Renewable Portfolio Standards for on-grid areas. Energy Secretary Raphael Lotilla signed the circular on Sept. 23.
The RPS is a policy mechanism under Republic Act No. 9513 or the Renewable Energy Act of 2008, which encourages electricity suppliers, particularly the distribution utilities, to source or produce a specified fraction of their power supply from eligible renewable energy resources.
The increase is also a mechanism designed to provide a guaranteed market for renewable energy.
Gatchalian, vice chairman of the Senate committee on energy, said the development of RE resources is central to the DOE’s sustainable energy agenda.
RE accounted for 22.40 percent of the country’s energy mix in 2021, with coal-based power plants accounting for 58.48 percent. Oil-based and natural gas power plants contributed 1.52 percent and 17.60 percent, respectively.
“The time is ripe for us to accelerate the development of renewable energy in the country. Record prices of fossil fuel, as well as continuing concerns on the impact of climate change, leave us with no other viable option but to vigorously pursue the development of green energy,” Gatchalian said.
The DOE so far approved 998 RE contracts, generating around P270 billion in investments. These contracts have an aggregate installed capacity of 5,460 megawatts and a potential capacity of 61,613.81 MW.