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Renewable energy tariff bidding from Dec

KUALA LUMPUR: Renewable energy (RE) producers will not automatically receive payment under the feed-in tariff (FiT) from December 2011.

Nevertheless, consumers in Peninsular Malaysia and Sabah, whose monthly electricity bills exceed RM77, will have to start paying an additional 1 per cent levy to subsidise RE producers from December 2011.

The FiT essentially guarantees RE producers a premium selling price over that generated from depleting and finite sources such as oil, gas and coal. 

Power generated from sustainable sources that will benefit from FiT includes that of oil palm biomass, biogas, small hydro and solar. 

Energy, Green Technology and Water minister Datuk Seri Peter Chin said, “RE producers need to go online and bid for the RE quota and the relevant FiT rate. “This is because the FiT rate differs for different RE technologies and installed capacities.”

Chin said this is the first time a government agency is facilitating FiT bidding via the Internet. “This is to ensure a transparent application process. The online FiT application system is available from December 2011,” he told reporters after witnessing the signing of memorandum of understanding between Flexo-research Malaysia and Flexoresearch Thailand here yesterday.

RE producers have to apply for licence from Sustainable Energy Development Authority (Seda) via http://seda.gov.my/.

Chin said during the application for a FiT approval, an eligible producer will be required to submit the work plan for their RE installation/plant. Once the Feed-in-Approval is granted, Seda will closely monitor each RE installation/plant until commencement date is achieved.

This close monitoring is to prevent the applicant from monopolising the RE quota. This monitoring is important as once a FiT application has been approved, a portion of the RE fund will automatically be allocated to the approved applicant.

The minister said the RE quota is revised accordingly to take into account the reduced RE Fund availability.

To avoid any monopolisation of the RE quota, Chin said Seda’s online system will track the RE installation/plant’s milestones via the submitted work plan. If any delays are detected, a notice will be sent to the applicant to request for an explanation for the delay. If the applicant fails to respond satisfactorily, then the application will be revoked.

When that happens, the fund committed to the applicant will be released, and this will return the allocated quota to the system. “This is to prevent any abuse of the FiT system and to allow other interested parties to apply for the FiT,” Chin added.

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