DAVAO CITY—The Mindanao Power Monitoring Committee (MPMC) has recommended the extension of a government mechanism called feed-in tariff (FiT) for at least the next five years to allow power developers to catch up with their investment and to offset the absence of wholesale market on power in the island.
“We are requesting for a five-year extension exclusively for Mindanao so that our developers will have enough time to catch up and get the most out of the FiT allowance,” said Romeo Montenegro, the deputy executive director of the government’s socioeconomic planning body, the Mindanao Development Authority (MinDA).
Montenegro sits as cochairman of the technical working group of the MPMC.
He said the request for extension may be viewed in the context of Mindanao’s “unique challenge that we currently do not have a Wholesale Electricity Spot Market [WESM] yet.”
The WESM allows power-distribution utilities and rural electric cooperatives to select the available and cheaper power sources and obtain them at a time when the former would need them.
The MPMC request was made following the end of the awarding of the FiT last year.
FiT is a government mechanism to entice renewable-energy (RE) projects by providing fixed returns to developers for 20 years. It lists the rates by which specific power sources would be bought by the client rural-electric cooperatives and distribution companies.
The MinDA supported and officially carried the same request to Malacañang that the recommended extension on the FiT program would be for hydroelectric power and biomass.
MinDA cochairs the MPMC with the Department of Energy (DOE).
MinDA Chairman Datu Abul Khayr Alonto said his agency already submitted the recommendation “in order to further encourage the entry of renewable sources in the Mindanao grid,” and it was timed with the recent announcement of the DOE “on the possibility of FiT to be extended for three more years.”
“We need to mitigate the anticipated electricity-price spikes given that Mindanao’s power capacity would be primarily based on fossil fuels. This can significantly add up the financial burden of the residential consumers,” Alonto said, adding the island’s availment of the benefits of the FiT was minimal. The MPMC said Mindanao only has a 3.6- percent share of the total FiT-All availment, while the Visayas and Luzon have 26 percent and 70.4 percent, respectively.
The MinDA said, from about 58 percent in 2010, RE capacity in Mindanao “is down to 36 percent in 2017, and is expected to be dominated at 70 percent by fossil technology.”
“This is part of the reasons why MinDA had been pushing for increased deployment of RE technology, in line with our long-term target of bringing energy mix back to the ideal energy mix by 2030,” Alonto said.
The MinDA said hydropower capacity topped Mindanao’s potential RE source at 1,945 megawatts.