The National Transmission Corp. (TransCo) is seen designating a trustee bank, likely one of two government-owned lenders, which will manage the feed-in tariff (FIT) allowance fund.
TransCo, according to President Rolando Bacani, will choose either the Land Bank of the Philippines (LandBank) or the Development Bank of the Philippines (DBP). “It’s either LandBank or DBP. We already wrote them and we are now evaluating the two banks,” Bacani said.
TransCo was tasked to administer the said fund from which payment for FIT-eligible renewable-energy generation will be sourced.
A FIT is a policy incentive mechanism extended over renewable energy firms and investors to promote greater investments in renewable energy sources.
The FIT allowance is a uniform peso per kilowatt-hour (kWh) charge paid by electricity end-users, as mandated by the Renewable Energy Act of 2008 (Republic Act 9513). It will be collected and placed in a fund, which will be administered by TransCo.
Bacani said TransCo must pick its preferred bank by May this year. “We must have a decision by then because it will be included in our application to the ERC [Energy Regulatory Commission],” he added.
Earlier, the ERC released the guidelines on the collection of the FIT allowance and the disbursement of the FIT allowance fund.
FIT refers to the prevailing ERC-approved schedule of rates for each emerging renewable-energy technology. The rates are as follows: P5.90 per kWh for run-of-river hydro; P6.63 per kWh for biomass; P8.53 per kWh for wind; and P9.68 per kWh for solar.
Based on the guidelines, the FIT will be paid to the developers of renewable energy. Electricity consumers will benefit from the mechanism as well.
“The application for the setting of the annual FIT allowance shall be filed by the [TransCo]. The FIT allowance collected from all on-grid consumers shall be remitted to the FIT allowance fund established and administered by [TransCo],” said the ERC.
