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ERC wants new feed-in tariff proposal for ocean energy resources

COMPANIES that are looking forward to a guaranteed rate for power generated from ocean energy resources will have to wait longer as the Energy Regulatory Commission (ERC) denied the feed-in tariff (FiT) proposed by the National Renewable Energy Board (NREB).

In a press release on Sunday, the regulator said that the deferred petition asked for a FiT rate based on ocean thermal energy conversion (OTEC), a process that produces electricity through the temperature difference between cold deepwater and warm surface water.

The ERC did not give the exact rate proposed by NREB, the panel that advises the Department of Energy (DoE) on matters relating to renewables.

The agency said it had ordered NREB to file another proposal for a new ocean FiT rate based on tidal in-stream energy conversion technology, which the regulator described as the most dominant type of ocean technology in the Philippines.

“Majority of ocean power projects awarded with service contracts by the [DoE] use tidal in-stream energy conversion,” ERC Chairperson and Chief Executive Officer Agnes VST Devanadera said in a statement.

She added the ERC found it reasonable to use this technology instead of OTEC as the representative project to determine the FiT rate for ocean energy technology.

The agency said more information exists on tidal in-stream energy conversion technology, which could be a point of reference in calculating the initial FiT for ocean energy. It also said OTEC’s operations have “not yet reached commercial scale.”

Ms. Devanadera said the ERC “deemed it prudent to evaluate and determine the reasonable levels” of feed-in tariff “on the basis of information that are relevant in the context of ocean technology developments in the country and in other jurisdictions.”

She said these considerations are vital since the tariff “are costs that are ultimately passed on to the consumers.”

In 2012, the ERC deferred the approval of a feed-in tariff for ocean technical when it issued its decision on FiT rates because NREB proposed OTEC as a representative project. The agency noted that there were no OTEC plants in commercial operation at that time, with a handful of pilot projects launched globally.

BusinessWorld reached out to NREB for comment, but has not yet received a reply as of press time.

Based on a DoE circular issued in 2015, the revised feed-in tariff installation target for ocean technology is 10 megawatts. — Angelica Y. Yang

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