The Energy Regulatory Commission (ERC) has unveiled preliminary pricing guidelines for the third round of the Green Energy Auction (GEA-3), set to award contracts totaling 4,399 megawatts (MW) in renewable energy.
The upcoming auction will offer contracts for various non-feed-in-tariff (FIT) technologies, including impounding hydro, pumped-storage hydro, and geothermal, while run-of-river (ROR) hydro remains the only eligible technology under the FIT policy.
The FIT program provides guaranteed payments at a fixed rate per kilowatt-hour for certain renewable energy (RE) sources to incentivize emerging technologies.
Ahead of the auction, the ERC is inviting stakeholders to submit feedback on a draft price determination methodology (PDM) designed to evaluate and select winning bids.
The proposed PDM will use a two-phase evaluation system focused on “project development costs, net capacity factors, and the weighted average costs of capital,” according to the ERC.
To advance in the selection process, each bid must meet a minimum score on these key factors before progressing to a second evaluation phase that assigns specific weights to each parameter based on its tariff impact.
“A total score of 90 percent is required to pass the evaluation, ensuring that all critical parameters are prioritized and comply with,” the ERC noted.
Bids that pass this evaluation will be submitted to the Department of Energy (DOE) for final selection of the winning bidders, who will be expected to operate their facilities within the parameters approved by the commission.
Industry stakeholders have until Nov. 15 to submit comments on the draft PDM, which the ERC will consider as part of its final pricing guidelines for GEA-3.
The GEA program aims to boost the country’s renewable energy capacity, supporting the government’s target of expanding RE’s share in the national energy mix to 35 percent by 2030 and 50 percent by 2040.
Energy Undersecretary Rowena Cristina Guevara recently assured lawmakers that the GEA-3 auction would conclude by year-end to help meet these ambitious targets.
