The Senate asked the Energy Regulatory Commission (ERC) to finalize green energy auction reserve (GEAR) prices so that the auction of renewable energy could proceed this year.
“That is one of the priorities I think we need to do, because in everything, the goal is to make the shift to renewables, and this is directly related to that. I hope we can get that done. I understand there are things that have to be done in the side of ERC as well,” Senator Pia Cayetano said at the Senate hearing on the Department of Energy (DOE)’s 2025 budget.
Energy Secretary Raphael Lotilla and ERC officer-in-charge (OIC) and chief executive Jesse Hermogenes Andres were present at the hearing. The DOE assured Cayetano that the third Green Energy Auction (GEA-3) would be completed within the year.
“Our target for the Green Energy Auction 3 is to finish it before the end of the year such that the pumped storage hydro, [more than] 3,000 megawatts (MW), will be able to come in five years from now,” Energy Undersecretary Rowena Guevara told senators.
But for the GEA3 to happen, the ERC should release first the GEAR prices. It is the mandate of the ERC to determine GEAR prices or the maximum price offers for the GEA.
“One of the items required there would be the approved pricing methodologies with ERC. We’re coordinating that,” Lotilla said.
Cayetano said many investors were waiting for the third leg of the GEA, which facilitates investments in the renewable energy space. In the last two years, the DOE conducted two rounds of auction which generated a total of 5,306 megawatts (MW) of RE commitments for delivery in 2024 to 2026.
The DOE, however, received commitment for only 3,580.76 MW out of the 11,600 MW offered under the GEAR2.
The DOE earlier cited supply limitation, low incentives, delay in the conduct of grid impact studies and the cost of financial guarantees as some of the reasons for low investor turnout during the GEA-2.
GEA-3 covers non-feed-in-tariff (non-FIT) eligible renewable energy technologies like geothermal, impounding hydro and pumped-storage hydro under DOE Circular No. DC2023-10-0029.
The estimated capacities for non-FIT Eligible RE technologies are 699 MW from impounding hydro; 3,120 MW from pumped storage hydro; and 380 MW from geothermal.
GEA-3 will also cover run-of-river (ROR) hydro, which is a FIT-eligible RE technology.
