Higher FIT-All in June billing okayed
The feed-in-tariff allowance (FITAll) line item in the consumers’ electric bills will be hiked by R0.059 per kilowatt hour (kwh) starting this June billing cycle based on the approval set forth by the Energy Regulatory Commission.
That will essentially increase the FIT-All charge being passed on to consumers to R0.18 per kilowatt hour from currently at R0.12 per kwh, according to ERC Officer-in-Charge Alfredo J. Non; while asserting that the petition for FITAll cost recovery for year 2017 hast yet to be ruled upon by the regulatory body.
According to Dinna O. Dizon, head of the National Transmission Corporation’s FIT-All Team and manager for compliance monitoring department, the additional FIT-All will hike the company’s monthly collection to more than R1.0 billion from currently at the level of R700 million plus. TransCo is the administrator of the FIT Fund that correspondingly settles the FIT incentives due to the renewable energy (RE) developers.
Essentially, she noted that the hiked FIT-All will reduce the collection shortfall and that TransCo could already somehow calibrate its FIT settlements to the qualified RE developers.
Nevertheless, TransCo president Melvin A. Matibag indicated that until the anticipated timeframe on the approval of the next adjusted FIT-All charges, there would still be shortfall in collections that they would need to plug with some form of bridge financing.
He disclosed that they already started negotiating with the World Bank for prospective zero-interest loan to cover the deficiency in FIT-All collections.
“We have known that World Bank has funding for clean energy and that they can offer it at zero-interest, so we are keenly looking at that to temporarily plug the cost gap in our FIT payments,” he said.
Matibag explained that if they will wind up successful negotiations with the multilateral lending agency, that will solve a lot of problems relating to the RE development investment terrain – primarily probable lenders’ default by the RE developers due to huge payment deficiencies; as well as the pile-up of interest charges that are integrated into the cost pass-on to consumers.
Energy Secretary Alfonso G. Cusi is similarly studying options on stretching cost recovery on the FIT for RE developers – that instead of 20 years, this be extended up to 40 years, provided there would be zero-interest loans that can be tapped whenever collections would fall short.
He said these policy options are still being studied with guidance from prospective lenders or funding institutions that could help defray the subsidy costs under the FIT system.