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Republic of the Philippines
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ENERGY REGULATORY COMMISS
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Posting
San Miguel Avenue, Pasig City
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IN THE MATTER OF THE
APPLICATION
TO
DEVELOP,
OWN, AND
OPERATE
DEDICATED
POINT-TO- POINT LIMITED
TRANSMISSION
FACILITIES TO CONNECT
COSMO SOLAR ENERGY,
INC. (CSEI) 5.6 MW SOLAR
POWER PLANT TO NGCP's
STA. BARBARA - SIBALOM
69kV LINE, WITH PRAYER
FOR
PROVISIONAL
AUTHORITY
. ERC CASE NO.
2016-012
MC
COSMO SOLAR ENERG~
INC. (CSEI),
Applicant.
)(-
- - - - - - - - - - - - - - - - - - - - -)(
NOTICE OF PUBLIC HEARING
TO ALL INTERESTED PARTIES:
•
On 6 May 2016, Cosmo Solar Energy, Inc. (CSEI) filed an
Application with Motion for Provisional Authority dated 21 April
2016 (Application) to request for authority to develop, own, and
operate dedicated point-to-point limited transmission facilities to
connect Cosmo Solar Energy, Inc. (CSEI) 5.6 MW Solar Power Plant
to the Sta. Barbara-Sibalom 69kV Line of National Grid Corporation
of the Philippines (NGCP).
In support of the Application, CSEI alleged the following:
1.
Applicant CSEl is a corporation duly organized and existing
under and by virtue of the laws of the Republic of the
Philippines, with principal office address at 2nd Floor Suite A,
UY BlCO Building, Yulo Street, Iloilo City, Philippines. It
may be served with notices and other processes of this
Z
ERC Case No. 2016-012 MC
Notice of Public Hearing /27 July
Page 20fS
2016
Honorable Commission through its counsel at the address
indicated herein.
2.
CSEI was organized and registered with the Securities and
Exchange Commission (SEC) in the development green
technology, providing renewable energy (RE) solutions
through project consultation, system, design, financing,
materials
procurement,
engineering,
construction,
installation, and operation"
3.
Based on the 2013 Transmission Development Plan of the
National Grid Corporation of the Philippines, the energy
demand in Visayas is expected to grow from 1, 746 MW in
2014 to 2, 574 MW by 20232• The demand in Panay, in
particular, will grow from 279 MW by year 2014 to 457 MW
by year 2023. With the increasing energy demand, tapping
or maximizing every available source of energy or power
plant, will be most helpful as it will definitely alleviate the
energy's situation in the country.
4.
Since the enactment of the Republic Act 9513, otherwise
known as the "Renewable Act of 2008, CSEI has recognized
great potential and opportunity in the development of
renewable energy in response to the government's call for
clean energy. Subsequently, when the Energy Regulatory
Commission (ERC) issued the pertinent rules on Feed-InTariff program ("FIT Rules") of the government, CSEI was
able to finalize its project to put up a solar plant to be able to
produce clean energy and be able to export the power to the
grid under the FIT program of the government.
5.
Thereafter, upon close coordination with the Department of
Energy (DOE) and compliance with requirements, CSEI
applied for and eventually executed a Solar Energy Service
Contract (SESC) with the Republic of the Philippines
through the Department of Energy last 31 October 2013 for
its Iloilo Solar Power project.3 The SESC granted CSEI the
right to explore and develop a particular renewable energy
area in accordance with the terms and conditions of the
Renewable Energy Service Contract. Consequently, as per
Resolution No. 93, Series of 2013 by the RE Review
Committee, CSEI as an RE developer has been evaluated and
recommended, as duly confirmed by the Secretary of DOE, to
be legally, technically, and financially qualified to enter into
the RE contract.
6.
In line thereto, part of the rights and obligations granted to
CSEI as an RE developer is to have a free and unimpeded use
of Solar Energy Resources within the contract area in view of
the solar energy operations, additional investments, and new
investments in regard of which, the DOE shall ensure the
'Copy of CSEI's Certificate of Incorporation, Articles of Incorporation, By-Laws and the latest
General Information Sheet is attached hereto as Annexes "A", "B", "C" and "D", respectively.
'Shown in Table 1ofNGCP's System Impact Study attached as Annex H.
3 Solar Energy Service Contract No. 2013-09-036.
ERC Ca~eNo. 2016-012 MC
Notice of Public Hearing /27 July
2016
Page 3 of8
rights, privileges, and other authorizations it may grant to
third parties will not defeat or impair such use.
7.
Thereafter, the company spent considerable amount of time
and effort to secure all permits and licenses from different
government agencies involved to materialize its Solar Power
project as well as its eventual participation in the FIT
program.
a. On October 31, 2013, CSEI was granted Certificate of
Registration by the Department of Energy (DOE) as a
Renewable Energy ("RE") Developer under Registration
No. SESC2013-09-036.4 Thereafter, CSEI was likewise
awarded a Solar Energy Service Contract (SESC No.
2013-09-036)5, to explore, develop and utilize the Solar
Energy Resources within the contract area in accordance
with the terms and conditions of the Renewable Energy
Service Contract. Moreover, on January 12, 2015, CSEI
was issued a Confirmation of Commerciality by the DOE
which affirms CSEI to develop and operate its Solar
Energy Operations.6
b. CSEI likewise requested National Grid Corporation of the
Philippines ("NGCP") to conduct a grid impact study to
assess the impact of the Solar Power Plant project on the
Visayas grid. On March 2015, the System Impact Study
("SIS") was officially released by NGCP.7Moreover, upon
compliance with the inter-connection requirements,
NGCP and CSEI executed its Connection Agreement
(CA), Transmission Service Agreement (TSA) and
Metering Agreement (MA).8
c. On July 25, 2014, CSEI was able to secure its
Environmental Compliance Certificate (ECC-R6-14070252-4220) for its 5.67 MW solar plant project located at
Barangay Narat-an, Miag-ao, Iloilo.9
d. CSEI will be filing with the Energy Regulatory
Commission (ERC) its application for issuance of
Certificate of Compliance (COC) - FIT to able to fully
participate in the implementation of the FIT program of
the government.
8.
A copy
copy
attached
6 A copy
7 A copy
4
5A
The energy generated by CSEI solar power plant will be
exported to the grid by tapping along Sta. Barbara Sibalom 69kV transmission lines, about 49.1 km from Sta.
of the Certificate of Registration is hereto attached as Annex "K"
of the Solar Energy Service Contract (SESC) No. 2013-09-036 and its amendment are
as Annex "F."
of the Confirmation of Commerciality No. SCC 2014-12-012 is attached as Annex "G."
of the System Impact Study for the 5.67MW CSEI's Solar Plant is hereto attached as
Annex "H,"
A copy
is hereto
9 A copy
attached
8
of the Connection Agreement, Transmission Service Agreement and Metering Agreement
attached as Annex "\", "J" and "K" respectively
of Environmental Certificate of Compliance (ECC-R6-151O-0370-4220) is hereto
as Annex "L."
ERC Case No.
MC
Notice of Public Hearing /27 July
2016-012
2016
Page 4 of8
Barbara Substation, owned by the National Grid of the
Corporation of the Philippines ("NGCP"). This connection
scheme will require constr1,lction of a dedicated point-topoint limited transmission facilities that will connect the
power plant to NGCP's line.
9.
Considering the need to develop and operate a dedicated
point-to-point
transmission facilities, this application is
being filed pursuant to Section 9 of the EPlRA which
expressly provides that:
"A generation company may develop and own
or operate dedicated point-to-point
limited
transmission facilities that are consistent with
the TDP: Provided, that such facilities are
required only for the purpose of connecting to
the transmission system, and are used solely by
the generating
facility, subject to prior
authorization by the ERC: Provided, further,
that in the event that such assets are required
for competitive purpose, ownership of the same
shall be transferred to the TRANS CO at a fair
market price: Provided, finally, that in the case
of disagreement on the fair market price, the
ERC shall determine the fair market value of
the asset."
10.
As stated earlier, the solar energy generated by CSEI's solar
power plant will be exported to the grid by tapping along
NGCP's Sta. Barbara-Sibalom 69kV line. The connection will
be a tap connection along the said 69kV line which passes
through the solar plant site. The power generated from the
solar inverters will initially pass through five (5) 1.25 MVA
0.277/13.2 kV step-up transformers and will be eventually
delivered to the grid via one (1) 10 MVA 13.2/69 kV step-up
transformer. The solar plant will tap between Miag-ao and
Hamtic 69kV load-end substations since the 69kV line
passes over the solar plant site. Below is a diagram showing
the proposed connection scheme.
For protection
located morc than 100 meters
from NGCP IInc, a disconnect switch at the
first pole near the tapping and a fault circuit
Indicator are required
more than 100 meter5
lOMVA
G9/13.8KV
DS~
Fault Orcl.lll
lndic.:l.lor
CIrcuit Breaker
not ~quirnd
J
ERC Case No. 2016-012 MC
Notice of Public Hearing /27 July
Pages of8
2016
The connection project will be exclusively used by
CSEI to tra,nsport its solar power to the grid. Basically, the
connection project will have the total cost of Php
231,690,220-47.'Q
11.
On June 2014, CSEI entered into an Engineering,
Procurement, and Construction Contract with several local
contractors namely LB Carmelo Engineering, Prefer Electric,
and JFS Electrical to undertake the solar power plant project
including the construction of the point-to-point transmission
line/facilities. Prefer Electrical Engineering and Supply is an
electrical engineering firm specializing in industrial facility
electrical! control design. Prefer Electric has been
contracting electric transmission projects with the National
Grid Corporation of the Philippines (NGCP) for over 15 years
with specialty on substation facilities including its point to
point connection and maintenance. During the interconnection of the CSEI, the NGCP District IV has supervised
the activity and in fact helped in the inter-connection process
as requested by CSEI to the NGCP Main office Manila
12.
On the other hand, CSE has the financial capacity to
undertake the construction, development, operation and
maintenance of the Iloilo Solar Power Plant project,
including the construction of the dedicated point-to-point
limited transmission facilities." As a matter offact CSEI has
invested 26% of the project cost and Landbank of the
Philippines has co-funded the 74% of the project. After
looking into the Economic and Financial Cost Benefits of the
project, CSEI pursued this project given the fiscal and nonfiscal incentives under the RE Law and its IRR, as well as the
attractive returns upon its participation in the FIT.
13.
As regards to the operation and maintenance, CSEI has
personnel who may be able to operate and maintain the said
facilities in close coordination with NGCP District 3-VSO.
Admittedly, however, CSEI personnel may be familiar only
with plant operation and might not be properly equipped
with the expertise needed in operating the dedicated pointto-point transmission facilities, not to mention the
regulatory standards and compliances that need to be met at
all times. With this, CSEI is willing to enter into agreement
with NGCP for the operation and maintenance of said line
for reliability and safety purposes. As a matter of fact, CSEI
already wrote a letter to NGCP regarding this matter, and the
latter already replied. In its reply dated 13 April 2016, NGCP
express willingness to extend their service in the operation
and maintenance of the facilities.'2
Attached as Annex "0" the Point-to-Point Project Components and Cost.
Attached herewith as Annex "P" is the 2014 Audited Financial Statement of CSEI.
'2 Attached as Annex "R" is the NGCP's Letter dated 13 April 2016.
W
a
ERC Case No. 2016-012 MC
Notice of Public Hearing /27 July
Page 6 ofB
2016
Motion for Provisional Authority and Allegations in
Support of Prayer for Provisional Authority
14.
Rule 14 ofthe Honorable Commission's Rules of Practice and
Procedure authorizes the issuance of a provisional authority
or an interim relief prior to a final decision, provided that the
facts and circumstances warrant the issuance of the same.
15.
Considering the need for additional capacity as demand for
energy continue to rise, and considering the readily available
excess clean energy coming from the Iloilo Solar Power Plant
of CSEI, it will be beneficial that the additional capacity
coming from CSEI power plant will be transported
immediately and made available for the Visayas Grid in a
timely manner. In fact, the solar plant project itself is already
completed and is only awaiting for this Honorable
Commission to issue or authorize Applicant to start its
testing and commissioning. Simply put, Applicant has
already 5.6MW clean energy readily available to the grid
should this Honorable Commission issue the pertinent
authority.
16.
Also, as manifested earlier, CSEI intends to participate in the
FIT program of the government. For the solar, CSEI was
already included on the list of committed generators for the
March 15, 2016 deadline of the Solar-FIT. However, despite
completeness and readiness of the project, it was not allowed
to inject to the grid due to some documentary requirements
needed prior to operation. Thus, CSEI is now targeting to
complete the documentation as soon as possible to be able to
connect and deliver its power to the grid. Hence, Applicant
respectfully prays that the Honorable Commission
provisionally approve the instant Application, as part of
CSEI's requirements, to help the latter attain its objectives of
making available its ready capacity to the grid and help in
alleviating the energy situation as projected by the DOE.
17.
Lastly, the development of Cosmo Solar Energy, Inc. is a
Cost-Sharing process where CSEI has invested 26% of the
project cost and Landbank of the Philippines has co-funded
the 74% of the project in a term loan agreement, hoping that
the project can avail the contracted FIT-ALL program of the
Department of Energy. Considering that the project is
already complete and ready to operate, Applicant CSEI needs
to fast track processing of its regulatory requirements for it
to be issued FIT-Eligibility and, consequently, be able to
enjoy the solar FIT rate in order for it to meet its obligation
with its lender. Hence, it is in such context the CSEI
respectfully prays that a provisional authority be
immediately issued for the approval of the instant
application as not to compromise the financial viability of
herein Applicant.
18.
In support of the instant Application and all computations
contained, Applicant hereto attached the following annexes:
ERC Case No. 2016-012 MC
Notice of Public Hearing /27 July 2016
Page 70f8
Annexes
Documents
Certificate of Incorporation
Amended Articles of Incorporation
A
B
ByLaws
Latest General Information Sheet
DOE Certificate of Registration
C
D
E
Solar Energy Service Contract
DOE Confirmation of Commerciality
F
System Impact Study
Connection Agreement
Transmission Service Agreement
Metering Agreement
Environmental Compliance Certificate
Single Line Diagram
Technical Specification of the Project
Project Component and Cost
Audited Financial Statement (CSEI)
Economic and Financial Cost Analysis
G
H
I
J
K
L
M
N
0
P
Q
NGCP's Letter dated 13 April 2016
R
NGCP's Certification issued 13 April 2016
Board Resolution dated 12 February 2016
S
T
PRAYER
WHEREFORE, it is respectfully prayed to this Honorable
Commission that, pending hearing on this case, the instant
application filed by Cosmo Solar Energy Inc. (CSEI) for authority to
develop, own and operate dedicated point-to-point transmission
facilities to connect CSEI's 5.6 MW Solar Power Plant to NGCP's 69
Sta. Barbara - Sibalom 69kv line, be provisionally APPROVED,
and that after hearing on the merits of this application, the
authority granted be made PERMANENT.
Other reliefs just and equitable under the premises are also
prayed for.
The Commission has set the application for determination of
compliance with the jurisdictional
requirements,
expository
presentation, Pre-Trial Conference, and presentation of evidence on
14 September 2016 (Wednesday) at ten o'clock in the
morning (10:00 A.M.) at the ERC Hearing Room, 15th Floor,
Pacific Center Building, San Miguel Avenue, Pasig City.
All persons who have an interest in the subject matter of the
proceeding may become a party by filing, at least five (5) days prior to
the initial hearing and subject to the requirements in the ERC's Rules
ERC Case No. 2016-012 MC
Notice of Public Hearing /27 July
Page 8 of8
2016
of Practice and Procedure, a verified petition with the Commission
giving the docket number and title Ofthe proceeding and stating: (1)
the petitioner's name and address; (2) the nature of petitioner's
interest in the subject matter of the proceeding, and the way and
manner in which such interest is affected by the issues involved in the
proceeding; and (3) a statement of the relief desired.
All other persons who may want their views known to the
Commission with respect to the subject matter of the proceeding may
file their opposition to the application or comment thereon at any
stage of the proceeding before the applicant concludes the
presentation of its evidence. No particular form of opposition or
comment is required, but the document, letter or writing should
contain the name and address of such person and a concise statement
of the opposition or comment and the grounds relied upon.
All such persons who wish to have a copy of the application may
request from the applicant that they be furnished with the same, prior
to the date of the initial hearing. The applicant is hereby directed to
furnish all those making such request with copies of the application
and its attachments, subject to the reimbursement of reasonable
photocopying costs. Any such person may likewise examine the
application and other pertinent records filed with the Commission
during the standard office hours.
WITNESS, the Honorable Chairman JOSE VICENTE B.
SALAZAR, and the Honorable Commissioners ALFREDO J. NON,
GLORIA VICTORIA C. YAP-TARDC, JOSEFINA PATRICIA
A. MAGPALE-ASIRIT, and GERONIMO D. STA. ANA, Energy
Regulatory Commission, this 2rh day of July 2016 in Pasig City.
ATTY. NAT
• MARASIGAN
Chie if Staff
Office of the Chairman and CEO