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TransCo to oversee feed-in tariff payments to renewable energy firms

November 19, 2012 2:30pm
The Energy Regulatory Commission has appointed the National Transmission Corp. (TransCo) to administer the feed-in tariff allowance (FIT-All) payments to renewable energy (RE) developers.

"The ERC has approved today [Nov. 19] that it should be Transco that should be administering the FIT payments," said ERC executive director Francis Saturnino Juan in a press briefing at the Renewable Energy Dialogue held by the ERC, the Department of Energy, the Commission on Climate Change and German sustainable development services provider GIZ.

A feed-in tariff is a policy extended to renewable energy firms and investors meant to promote more investment in renewable energy.  

According to the International Center for Trade and Sustainable Development (ICTSD), a feed-in tariff is "defined by three key characteristics: guaranteed electricity purchase prices, guaranteed grid access and long-term contracts. Increasingly these tools, or programs, are designed in a way to encourage the adoption of renewable energy sources."

The FIT-All is the uniform peso per kilowatt-hour charge paid by electricity end-users, as mandated by the Renewable Energy Act of 2008 (R.A. 9513). It will be collected and placed in a fund, which will be administered by TransCo.

Juan said this means that public funds will be managed by a government-owned and -controlled company and not by the private, Sy-controlled National Grid Corporation of the Philippines (NGCP).

NGCP manages and operates TransCo's nationwide power transmission system, which links power plants with electricity utilities across the Philippines. However, according to TransCo on its official website, ownership of all of its transmission assets remains with TransCo.

"This will resolve the issue that public fund[s] should be handled by [a] public entity," said Juan.

Juan added that the National Renewable Energy Board (NREB), which formally endorsed TransCo to become the FIT-All administrator in September, agrees with ERC's decision. — BM, GMA News
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