Is ERC favoring renewable energy?

MANILA, Philippines — “We’re not playing favorites.”

That was the Energy Regulatory Commission’s (ERC) response to questions over whether the regulator is tilting the playing field in favor of renewable energy (RE) over other power generation technologies.

ERC chairman and CEO Francis Saturnino Juan rejected the notion, maintaining that the commission’s decisions are guided by the law and not by any preference for a particular technology.

“If there is a policy and we’re asked to provide the implementing rules for it, we’re supposed to perform that mandate by coming up with regulations to make sure the policy is implemented,” Juan said.

This follows the ERC’s adoption of higher price ceilings for the country’s landmark offshore wind and waste-to-energy (WTE) auctions, a decision critics say could translate into more expensive electricity rates for consumers.

The price ceiling for the WTE auction is set at P9.2959 per kilowatt-hour, while the offshore wind auction carries an even steeper cap of P11 per kWh.

These prices are expected to drive up the green energy auction allowance, a charge collected from consumers through their electricity bills.

As part of its energy transition agenda, the government has launched a series of RE auctions designed to spur more investments into the sector.

Over the weekend, the Department of Energy lifted the suspension of the special WTE auction while raising the installation target to 400 megawatts from 230 MW.

It also extended the registration period for qualified suppliers until July 31 and moved the mechanical completion deadline to Dec. 31, 2028.

The delivery commencement date, meanwhile, was pushed back to Dec. 31, 2029.

“It is in EPIRA (Electric Power Industry Reform Act) and the RE Act for us to reduce dependence on imported fuel,” Juan said.

Renewables, he stressed, helped cushion the impact of the global oil crisis, with rooftop solar reducing electricity demand that would otherwise have been sourced from the spot market.

Average electricity spot prices surged by 23 percent to P9.56 per kWh in June amid tight supply conditions, according to the Independent Electricity Market Operator of the Philippines.

Still, Juan maintained that the ERC remains committed to acting on all power supply agreements resulting from competitive bidding, regardless of the technology involved.

“Any additional coal, natural gas or even nuclear power plants that are built will require regulatory action for permitting or contract approvals. We will evaluate and approve them if they are justified by the evidence,” he added.

Under EPIRA, the same law that created the ERC, the regulator is mandated to ensure the promotion of consumer interests and foster market competition.