The Department of Energy (DOE) is preparing to auction microgrid services in areas of the country that are not connected to the national grid.
Rowena Guevara, DOE undersecretary, said on the sidelines of the Giga Summit in Makati City yesterday the rules will be out this year and will benefit both the investors and consumers.
A micro grid is a limited network of electricity users with a local source of supply that can function even if it is not connected to the national grid.
Guevara said to be auctioned this year would be the first batch of areas that are the best markets for microgrids, adding that the move is in line with the Microgrid Systems Act signed last year.
“We have 120 islands that are not connected to the grid but not all of them will already be included in the auction. Since this is the first time that we will conduct this, we have to see if how many of them can be accommodated but we are still computing the list of those who want to avail,” Guevara explained.
The DOE said a notice of auction will be released within the year, alongside the auction’s design, noting that several developers want to participate but are not yet ready with their key permitting requirements.
Guevara said requests for microgrid services should come from the areas but some localities are not yet ready with their requirements, particularly the needed technical data to justify the feasibility of operating such project.
Under the Microgrid Systems Act, a microgrid system provider (MGSP) may provide integrated power generation and distribution services in an unserved or underserved area, such as islands and places that have no access to power distribution lines, no electricity access and no home power systems for the duration of a service contract.
MGSPs can be a cooperative, local government unit, non-governmental organization, private corporation, power generation company or distribution utility that can comply with the technical, financial and other relevant requirements.
The law also states that MGSPs will not be considered a public utility and will not be required to secure a franchise from Congress, but they need to obtain an authority to operate from the Energy Regulatory Commission prior to their operation.
