PEMC plays important role in the government’s 50 percent Renewable Energy target by 2040

Philippine Electricity Market Corporation (PEMC) President Elvin Hayes E. Nidea was one of the keynote speakers for the ASEAN Clean Energy Forum held at the SMX Convention Center in Pasay City on 21 November 2023.

The annual event was attended by luminaries and stakeholders of the energy sector hoping to get a glimpse of the power industry’s efforts and plans to lessen the carbon footprint and increase sustainable sources of energy in line with the 2020–2040 National Renewable Energy Program (NREP) of the government.

President Nidea gave important updates on this and detailed the programs that have been implemented by PEMC under the policies and supervision of the Department of Energy (DOE) and the Energy Regulatory Commission (ERC).

“Renewable Energy has increased based on its share in the power generation mix as of August 2023, which is at 22.44%.” Nidea said in his opening statement. “That is 2.33% higher as compared to the total share of RE in the generation mix in 2022.” He further explained.

According to Nidea, PEMC is currently in charge of the Renewable Energy Market (REM), which is the venue for Mandated Participants to buy and sell Renewable Energy Certificates (REC) for them to comply with their annual Renewable Portfolio Standards (RPS) obligation, as set by the DOE. The REM is one (1) of the nine (9) programs envisioned to be implemented in the Renewable Energy Act (RE Act) of 2008.

In the REM, each mandated participant receives RE Certificates based on the generation from Feed-in-Tariff eligible facilities and their contracts with RE generators, as well as the actual generation of their registered net-metering facilities and supply from Green Energy Option Program (GEOP). Through the REM, most of the programs in the RE Law will be implemented and will contribute to the gradual increase in the usage of renewable energy as mandated by the government on the power industry, both for the generators and consumers.

PEMC, through a tripartite agreement between the DOE and the Independent Electricity Market Operator of the Philippines (IEMOP), is in the process of transferring the operation of the RE Market and its system, the Philippine Renewable Energy Market System (PREMS), to the Market Operator.

Nidea also explained how this future set up will define the critical roles of PEMC, IEMOP, DOE, and ERC in making sure the operation of the REM is successful. “Focusing on our governance function, PEMC and the REM Governance Committee (RGC) oversee the compliance of the REM participants with their RPS obligations and improve the market rules and efficiency,” Nidea said.

“The DOE focuses mainly on the policy making aspect such as the promulgation of policies and setting of RPS requirement. On the other hand, ERC issues guidelines and rules on RE-related programs, as well as the cost recovery mechanism for the RPS Mandated Participants and the methodology and determination of REC Price Cap,” he added.

There also have been efforts from PEMC to promote the increase of investments in the RE sector through a partnership with the United Nations Office for Project Services (UNOPS). The Southeast Asian Energy Transition Partnership (ETP) is looking into the possibility of introducing a Voluntary RE Market (VREM) in the Philippines which could help accelerate the plans of the government of 50% renewables in the power generation mix by 2040.

President Nidea assures the public that the PEMC, IEMOP, DOE, ERC, and Market Participants will work hand in hand to make sure operations of the RE Market will be successful leading towards a sustainable clean energy future