By Sheldeen Joy Talavera, Reporter
CONSUMERS might even see higher electricity bills starting next month because the Energy Regulatory Commission (ERC) approved a latest feed-in tariff allowance (FIT-All) that goes to paying renewable energy (RE) developers.
At a press briefing on Monday, ERC Chairperson and Chief Executive Officer Francis Saturnino C. Juan said the commission has approved a brand new rate of P0.2073 per kilowatt-hour (kWh), higher than the P0.1189 per kWh previously imposed.
“Under the principles of the feed-in tariff system released by the ERC, FIT-eligible plants are guaranteed to be paid the approved rate. And in the event that they already generated and delivered this electricity, they need to be paid because this is basically a commitment we made, and it’s grounded in law,” Mr. Juan said.
The FIT-All is a uniform charge billed to all on-grid electricity consumers to support the event and promotion of renewable energy.
Payments are remitted to the FIT-All fund established and administered by the National Transmission Corp. (TransCo). The fund goes towards paying eligible RE developers who’ve obtained fixed rates for electricity generated by their projects.
Because the administrator, TransCo is tasked to file the appliance before the ERC to find out the annual FIT-All rate.
The ERC said it has conducted public hearings across the country and “rigorously reviewed” the appliance from TransCo.
“This decision is a careful balance. It secures the expansion of renewable energy that our country needs, while keeping electricity rates reasonably priced for each Filipino household and business,” Mr. Juan said.
In accordance with the ERC, the brand new rate covers outstanding payments and maintains a small buffer fund to stop delays in future payments to RE producers.
The funds are required to settle a P19.06-billion FIT differential and construct a P3.74-billion working capital allowance, which serves as a buffer to ensure timely payment to RE generators.
The ERC has ordered a direct audit to ensure that the FIT-All fund is managed properly. All parties involved, including grid operators and power distributors, have been directed to make their records available for this review.
The National Association of Electricity Consumers for Reforms (Nasecore) called for full transparency and accountability in FIT-All rate adjustments, saying that public consultations should not enough.
In an announcement sent to BusinessWorld, the buyer group urged the ERC to release an annual audit of the FIT-All fund and supply detailed explanations of calculations used to find out any shortfall requiring rate adjustments.
Nasecore also called on the regulator to contemplate alternative measures to sustain RE funding without putting an excessive amount of financial pressure on consumers.
“Transparency will not be optional; it’s a legal and moral obligation. If ERC fails to release the audit and supply proper documentation and accountability, it could actually only mean a failure of regulatory oversight. Consumers need to see how their money is collected and utilized,” said Nasecore President Patronilo L. Ilagan.
ANOTHER HIKE
The ERC also approved the proposed latest market fee of the Independent Electricity Market Operator of the Philippines (IEMOP) covering the period of 2025 to 2027 to enhance the operations of the Wholesale Electricity Spot Market (WESM).
The brand new market fee of P0.0071 per kWh is the fee of administering and operating the WESM, which might be collected from generators transacting within the spot market.
The approved fee covers the operational, administrative, and capital expenditure budgets of each IEMOP because the market operator and the Philippine Electricity Market Corp. (PEMC), which is the WESM’s governing body.
In accordance with the ERC, the market fee ensures “a reliable and transparent WESM,” because it provides cost predictability for generators and guarantees the integrity of the market’s critical functions like pricing, settlement, and data reporting.
The allocation includes critical IT and cybersecurity upgrades.
“This approval is a key step in the continued reform of the electricity market. It ensures IEMOP and PEMC can operate sustainably and fulfill their mandates, balancing industry needs with accountability to consumers,” Mr. Juan said. “This decision is an element of our continuing efforts to advertise a secure, competitive, and consumer-oriented power industry.”
WESM is where energy corporations can buy power when their long-term contracted power supply is insufficient for customer needs.