THE Department of Energy (DoE) has clarified the implementation of its coal moratorium policy, saying that recent capability from on-grid coal-fired power plants could also be allowed only under “exceptional circumstances.”
In an Oct. 14 advisory signed by Energy Secretary Sharon S. Garin, the agency laid out additional conditions and exemptions governing the processing of applications for endorsements for brand spanking new coal-fired power projects.
The advisory was issued pursuant to guidance from the Office of the President and addresses inquiries in regards to the moratorium’s applicability to self-generating or own-use facilities, in addition to to recent capacities in each on-grid and off-grid areas.
The DoE said the 2020 moratorium halted the processing of applications for brand spanking new or “greenfield” coal projects, apart from those “falling under the conditions for non-coverage,” noting that increased requests for clarification prompted the formal advisory.
EXCEPTIONAL CASES, EXEMPTIONS
Under the updated policy, the DoE said recent capability from on-grid coal plants could also be allowed “solely under exceptional circumstances, equivalent to during a declared or imminent power crisis, or when there’s an imminent shortage of electricity supply that, if unaddressed, may result in severe impacts in specific areas or regions.”
The agency also identified other categories of coal projects which will qualify for non-coverage under the moratorium. These include industrial parks planning to develop and use coal-fired power plants for their very own operations, “provided that locators registered as Philippine Economic Zone Authority (PEZA) industrial park locators secure endorsement from the PEZA,” in keeping with the advisory.
Coal-fired power projects in off-grid areas are also explicitly exempt, as are own-use coal plants supplying power for mining and processing of critical minerals essential to energy transition projects.
Developers of projects that fall under these instances are required to use with the DoE for a “letter of acknowledgment of non-coverage,” the advisory said.
Proponents of coal-fired projects with existing letters of acknowledgment of non-coverage must commit to a guaranteed delivery or industrial operations date (COD), with any changes subject to DoE review and approval.
“All coal-fired power plants with a letter of acknowledgment of non-coverage shall have a time-bound transition plan to renewable or clean energy sources, with retirement or conversion to scrub fuel alternatives not later than Dec. 31, 2060, whichever comes earlier,” the advisory read.
“This doesn’t preclude such power plants from being retrofitted or converted for continued operation using clean fuel alternatives to coal.”
The DoE said the updated advisory supports the Philippines’ energy transition goals while maintaining energy security.
It would also study and determine a particular timeline for the retirement or transition of all existing coal-fired power plants, considering “the economic life span of the ability plants, access to financing mechanisms, and the necessity to ensure sufficient and stable energy sources to exchange coal.”
EFFECTIVITY
The advisory, addressed to all concerned stakeholders including the Energy Regulatory Commission (ERC) and PEZA, took effect immediately upon posting on the DoE website.
“The Department of Energy stays committed to balancing energy security, affordability, and sustainability in keeping with the country’s clean energy transition,” the agency said. — Sheldeen Joy Talavera