TransCo seeks higher FIT-All rate for 2027 to boost renewable energy

MANILA, Philippines — State-owned firm National Transmission Corp. (TransCo) is seeking regulatory approval to increase the Feed-in Tariff Allowance (FIT-All), a fee collected from on-grid electricity consumers and meant to entice further investments in the renewable energy market. FIT provides guaranteed payments at a fixed rate per kilowatt hour (kWh) for renewable energy plants. All qualified facilities can enjoy this scheme for 20 years. READ: Consumers to pay extra for renewable energy Based on its filing before the Energy Regulatory Commission (ERC), the agency wants to hike the FIT-All rate for 2027 to P0.2154 per kWh. That figure is higher than this year’s P0.2011 per kWh. TransCo said the proposed FIT-All rate for next year was computed based on its projected FIT differential—or the difference between FIT rates payable to renewable energy and spot market prices—for developers, working capital to cover payment and collection risks as well as administrative and trustee costs. “The grant of a provisional authority will enable TransCo to fulfill its duties and ensure timely payments of the FITs to FIT-eligible RE developers,” it said. A delay in the approval may lead to interest, “which will eventually result in additional charges to end users,” TransCo added. This came even as consumers continued to face elevated power rates. The Department of Energy (DOE) said that, together with the ERC, the government has started scrutinizing the electricity pricing of Manila Electric Co. (Meralco), the largest power distributor in the market. This is to ensure that millions of consumers are paying fair rates following widespread complaints about allegedly excessive bills. The DOE said last week that it met with ERC and Meralco officials for initial talks on potential reforms after President Marcos’ call to scrap system loss charges from power bills. Energy Secretary Sharon Garin echoed Marcos’ call, saying that “consumers should only pay for the electricity they actually use, not for losses they did not cause.” READ: ERC orders Meralco to refund P9.5 billion to consumers The DOE said that Meralco was open to exploring operational adjustments to help lower energy prices for its about 8.3 million consumers “in the coming months.” Meralco earlier defended recent rate hikes and put the blame on the surge in global oil prices and the weakening of the peso against the US dollar due to the lingering conflict in the Middle East. The effect of these on the generation charge, which accounts for more than half of consumers’ monthly bill, was “beyond the control of Meralco,” the company said. The DOE’s statement came a day after Meralco chair Manuel V. Pangilinan said that removing system loss charges would slap a financial burden “too big” for industry players to shoulder. System loss charges account for electricity lost due to technical and nontechnical factors. Nontechnical losses are blamed on power theft and illegal tapping and jumper wires. Technical losses happen, on the other hand, when some electricity is converted into heat due to aging or inefficient power lines. Garin said there are solutions to technical and nontechnical losses, including upgrading power lines and deploying advanced metering systems, as well as heightening efforts against electricity theft. INQ