DOE policy prioritizing RE dispatch in WESM a step towards a cleaner, cheaper, and more reliable power system

April 7, 2022

Quezon City—The Department of Energy (DOE) is taking the right steps toward achieving energy security and affordability in the country.

This was the reaction of climate communications and advocacy group The Climate Reality Project Philippines to the recent pronouncement of the DOE that it will issue in the third quarter of this year a new policy declaring all renewable energy (RE) plants as preferential dispatch units in the wholesale electricity spot market (WESM).

“Preferential” dispatch refers to generating units labeled as both “priority” and “must” in power generation. Currently, only solar, wind, and run-of-river are must dispatch, while biomass (eligible in Feed-in-Tariff) is preferential or priority dispatch. The DOE’s new policy intends to cover all RE, including geothermal and biomass, as priority dispatch, and eventually, impounding hydro and other RE.

Noting that this move by the DOE is a welcome development following the release of the final installment of the Intergovernmental Panel on Climate Change (IPCC) Sixth Assessment Report, which reaffirmed that we cannot achieve 1.5°C without rapid energy transition, Climate Reality Philippines Manager Nazrin Castro said:

“DOE is in the right direction with this new policy, which will boost the confidence of RE players in the country, especially at the local level. They are also in the right mindset to recognize the cost-competitiveness of RE (compared to coal and other fossil fuels), with RE supply abundantly available for us but with the main challenge remaining as regards the cost of developing the technologies—which the DOE is also looking into to bring down RE costs.

It’s a tall order for the DOE to achieve our targets of increasing the RE share in our power mix by 35% by 2030 and by 50% by 2040 (with RE share only at 21.2% in 2020). This new policy and the other RE policies and programs of the DOE—such as the Green Energy Option Program (GEOP), Renewable Portfolio Standards (RPS), Green Energy Auction Program (GEAP), and RE Trust Fund—will hopefully work towards reaching these goals.

The DOE is in a strategic vantage point to set the country on track towards a cleaner, cheaper, and more reliable power system in renewable energy and veer us away from climate change and war-inducing sources in fossil fuels.”

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