MANILA, Philippines —Power consumers will again be charged an additional 3.64 centavos per kilowatt-hour (kWh) starting next month after the Energy Regulatory Commission (ERC) ordered the resumption of the collection of an additional charge meant to incentivize renewable energy developers.
The ERC announced on Thursday that the collection of Feed-in-Tariff Allowance (FIT-All) would resume in the February 2024 billing cycle, citing a “looming deficit” in the FIT-All fund.
According to ERC Chair Monalisa Dimalanta, the remaining FIT-All fund as of Jan. 5 was P2.98 billion. Some P2.2 billion is paid monthly to renewable energy developers.
READ: ERC defers collection of FIT-All charges until Aug 2023
“As the commission reevaluated the balance of the FIT-All fund as of Jan. 5, 2024, … the ERC found that the projected FIT All fund would be in deficit in the February 2024 customer monthly billing,” the ERC said in a statement.
Financial incentives
FIT All serves as an incentive for renewable energy developers to encourage them to build more facilities and help increase the share of renewables in the country’s energy mix.
It is among the financial incentives provided by the Renewable Energy Act of 2008 to promote the use of emerging clean energy sources such as wind, solar, run-of-river hydro and biomass.
The uniform P0.0364 per kWh charge, which translates to P7.28 for a household consuming 200 kWh, was approved in August 2022.
However, the ERC resolved to temporarily suspend FIT-All collection from December 2022 until January this year to “alleviate the burden of Filipinos” amid rising electricity costs.
READ: ERC extends suspension of FIT-All collection by another 6 months
Dimalanta in October 2023 said they were observing movements in the spot market to determine whether the continued suspension of FIT All collection was still feasible.
“Before [the FIT-All fund] gets depleted, if necessary, we will need to lift the suspension of collection of FIT-All so we can start building up the fund again to pay the renewable energy developers supplying power as part of the FIT program,” Dimalanta had said.