Phinma Energy Corp. has signed a solar energy service contract with the Department of Energy to support plans of a 45-megawatt solar farm in Batangas.
The service contract grants Phinma Energy the exclusive right to explore, develop and use the solar energy resource in a 486-hectare area traversing the city of Lipa and the town of Padre Garcia, the firm said in a statement yesterday.
The company said the contract was good for 25 years, which could be extended for another 25 years.
Last August, Phinma Energy reported its net income for the first semester this year fell by 45 percent to P298 million from P542 million in the same period last year due to lower electricity prices.
Still, the company said it was able “to achieve a significant volume of customer migration” due to the implementation of the retail competition and open access (RCOA).
In this scheme, regulators consider electricity consumers with monthly average peak demand of at least 1 megawatt as “contestable customers.” This means such consumers should be able to choose the supplier of their energy requirement, instead of the incumbent distribution utility.
Alternative distributors, dubbed retail electricity suppliers (RES), can sell electricity to contestable customers at competitive rates through direct negotiations and contracts on a wholesale basis.
The RCOA for the 1-MW threshold was supposed to have been implemented last February, but the Supreme Court came in and issued a halt order.
“Despite the temporary restraining order issued by the Supreme Court, Phinma Energy was able to garner a 14-percent RES market share,” the company said.
“However, heightened competition and increasing penetration of must dispatch variable renewable energy have driven market prices of electricity downward,” the company added.