DOE seeks investors to build microgrids in remote areas

MANILA  -The Department of Energy (DOE) is set to conduct this year a competitive bidding for the development of microgrid systems in remote areas that are still not connected to the national grid, citing an urgent need to ensure total electrification in rural communities.

Energy Undersecretary Rowena Guevara told reporters on Wednesday the agency was to complete a list of off-grid areas that need microgrid systems.

“We have 120 islands that are not connected to the grid, but not all will benefit from the [initial auction] because this will be our first time doing it. We have to see how many we can accommodate,” Guevara explained.

Compared to the unified national grid, a microgrid is a localized power transmission facility that can function independently to serve specific areas. This is mostly used in underserved communities, or those that do not have 24/7 access to power.

Under Republic Act No. 11646, or the Microgrid Systems Act of 2022, a competitive selection process must be conducted before a microgrid system provider can serve off-grid areas. This can be done through an auction or unsolicited proposal.

The law likewise requires distribution utilities to submit their local total electrification roadmaps and list of underserved areas.

Notice of auction

According to Guevara, the DOE will issue a notice of auction within the year once the list of underserved areas is completed and verified.

“There are some areas that still need to submit requirements, including the number of affected customers, their expansion plans and other technical data,” she said.

Qualified microgrid system providers are tasked with building, operating, maintaining and controlling their respective systems, and supplying the power requirements in their areas.

The microgrid system provider may be any private corporation, local government unit, cooperative, nongovernment organization, generation company or distribution utility that “have demonstrated the capability and willingness to comply with the relevant technical, financial and other requirements as prescribed under the competitive selection process for [microgrid system providers],” the DOE said.