QuestionsQuestions (ERC Resolution NO. 21, S. 2011)
Under Section 43(t) of Republic Act No. 9136 (EPIRA), the Energy Regulatory Commission (ERC) is authorized to perform regulatory functions necessary to ensure the successful restructuring and modernization of the electric power industry.
Section 70 of EPIRA provides that the missionary electrification function of NPC through the Small Power Utilities Group (SPUG) shall be funded from revenues from sales in missionary areas and from the Universal Charge to be collected from all electricity end-users as determined by the ERC.
Section 34 of EPIRA empowers the ERC to determine, fix, and approve a Universal Charge imposed on all electricity end-users.
R.A. 9513 introduces mandates affecting missionary electrification, including cash generation-based incentives for renewable developers and requirements on sourcing generation from renewable resources in off-grid/missionary areas, which the amended guidelines must implement.
Section 15(h) grants a cash generation-based incentive per kilowatt hour rate generated, equivalent to fifty percent (50%) of the Universal Charge for power needed to service missionary areas where the developer operates; it is chargeable against the Universal Charge for Missionary Electrification (UC-ME).
It requires NPC-SPUG (or its successors-in-interest and/or qualified third parties in off-grid areas), upon recommendation of the National Renewable Energy Board (NREB), to source a minimum percentage of its total annual generation from available renewable energy resources in the concerned area, as determined by the DOE.
The resolution references FITS because ERC must formulate and promulgate FIT rules in consultation with NREB under Section 7 of R.A. 9513 and Section 5 of its IRR; the amended SAGR guidelines must conform with those FIT rules.
It is the ERC resolution promulgated on July 12, 2010 adopting the Feed-In Tariff (FIT) Rules, establishing the FIT system and the method of determining and approving FIT and FIT allowances (FIT-AII).
The ERC states it needs to amend the SAGR Guidelines to implement R.A. 9513 (including cash incentive to renewable developers), require NPC-SPUG to file a petition to set the UC-ME on or before March 15 annually, dispense with quarterly true-up petitions, and conform with the FIT Rules.
The ERC resolves to dispense with the filing of quarterly true-up petition.
NPC-SPUG is required to file a petition to set the UC-ME on or before March 15 of every calendar year.
ERC issued a notice for comments on the 1st draft (comments due not later than March 11, 2011) and a second notice on the 2nd draft (comments due not later than April 25, 2011) and held a public consultation on May 5, 2011.
The only entity mentioned as submitting comments by April 25, 2011 is Manila Electric Company (MERALCO).
The resolution shall take effect on the fifteenth (15th) day following its publication in a newspaper of general circulation in the country.
The resolution adopts the amended guidelines hereto attached as Annex “A,” and the annex is made an integral part of the resolution.
Copies are to be furnished the U.P. Law Center-Office of the National Administrative Register (UPLC-ONAR), NPC, SPUG, PSALM, all New Power Providers (NPPs) in Delegated NPC SPUG Areas, Renewable Energy Developers for Missionary Electrification, and Distribution Utilities.
The resolution was adopted by the ERC commissioners, as shown by the signatures of the Chairperson and Commissioners, and it was adopted on 22 August 2011.