The Ministry of Energy has stated that the Renewable Energy Act will soon be amended to bring more clarity on the policies and regulations of the Act.
According to the Ministry, the move is to ensure active participation of the private sector in achieving the government’s goal of scaling up the penetration of renewable energy in the energy mix.
In an interview, Director for Renewable Energy at the Ministry of Energy, Wisdom Togobo said the amendment of the renewable energy Act will be key in promoting the use of renewable energy.
“Today, a change in circumstances requires that we have to amend the Act. A typical example: at the time the Act was passed, electricity from solar was very expensive and most utilities and most bulk consumers would not buy power from solar,” Mr. Togobo explained.
In the case of solar energy, the Act put in place a Feed-In tariff to encourage developers who produce solar with the premium rate.
But today, “the price of solar is cheaper in some cases than some of the conventional energy schemes so the Feed-In tariff is no more an attractive option. It rather discourages investors,” Mr. Togobo noted.
The Feed-In Tariff Scheme has been established by the Renewable Energy Act for the purpose of guaranteeing the sale of electricity generated from renewable energy sources.
The Feed-in tariff scheme consists of the Renewable Energy purchase obligation, The Feed-In Tariff Rate and a connection to transmission and distribution systems.
The Public Utilities Regulatory Commission (PURC) oversees the level of rates that may be charged by the public utility for electricity generated from renewable energy sources.
The Commission takes into account the technology being used in the renewable energy industry, costs associated with construction, commissioning, operation, and maintenance of the plant, the reasonable rate of return among others.