The third round of the green energy auction or GEA-3 has been rescheduled to the first quarter next year to allow the Energy Regulatory Commission (ERC) to rework its pricing mechanism.
GEA-3 was supposed to happen this month when proponents of geothermal, run-of-river and pump storage hydro technologies compete in offering the Department of Energy the most attractive cost. As implemented at present, proponents throw bids equal to or lower than the GEA reserve or GEAR price and select the winner.
According to ERC chief Dimalanta, the regulator is experiencing challenges in discussing pricing parameters that require full resolution prior to adoption.
“We went down to the detailed discussions on what those pricing parameters should b,” Dimalanta told reporters during the Asean Clean Energy Week conference in Pasay City last week.
She also said the DOE is considering to implement changes in the GEA-3, including the possibility of not putting GEAR prices and instead allow developers to offer their own bid prices which is considered more apt for technologies involved in the current program.
“What we want is if bidders join the auction, the steps are laid out on what needs to be undertaken after they win as we want it to be as clear as possible that the rates won are still subject to review,” Dimalanta added.
The ERC also said preparations have been carried out to re-bid capacities with no takers under GEA-2, particularly for floating solar power.
Dimalanta said discussions with floating solar power proponents on GEAR improvements but in a manner that should not be “unfair” to developers that submitted bids prior to the adjustments.
The ERC said removing GEAR prices for floating solar is not applicable as the technology has a different business model compared to technologies under GEA-3.
“We’re open to not having a GEAR for geothermal and pumped storage hydro because we recognize the business model there is different, the funding requirements are different so it’s very hard to set out that number and make them bid,” Dimalanta said.
“For geothermal and pumped storage hydro, there are only limited players so there’s really no auction to speak of. But for solar, there are so many players it’s really prime for an auction with a set tariff,” Dimalanta said.
