Distributed Energy Resources

Distributed Energy Resource (DER) Overview

Distributed Energy Resources (DER) are power sources connected to the distribution system or electrical system of end-users that could be aggregated to meet demand for energy.

On 29 November 2022, the Energy Regulatory Commission (ERC) Resolution No. 11, Series of 2022, “A Resolution Adopting the Rules Governing Distributed Energy Sources (DER)” also known as the “DER Rules”, was published in a newspaper of national circulation and took effect on 14 December 2022.

The DER Rules cover three (3) types of installations:

DERs utilizing renewable energy (RE) sources for end-user systems connected on-grid and are meant for consumption and export, with nameplate capacity of greater than 100kW up to 1MW, but maximum capacity to export capped at 30%;
DERs utilizing renewable energy (RE) sources for end-user systems connected off-grid and are meant for consumption and export, with nameplate capacity not greater than 1MW, and maximum capacity to export also capped at 30%; and
DERs utilizing any energy generation and storage technology, whether on- or off- grid, and meant for end-user consumption only, so long as the DER owner and end-user are not the same entity.

Technologies such as microgrids, EVs, net-metering, stand-alone battery energy storage systems, etc. that are covered by other regulations are not covered by the DER Rules.

*Nameplate capacity refers to the maximum rated output of an electric power equipment.

Compensation Methodology for DER Export Energy

For on-grid Renewable DER, the DU will compensate the exported energy based on the DU’s monthly blended generation rate, in relation to its DER’s rated capacity, computed as follows:

100kW to 500kW: 75% of the blended generation rate
Above 500kW to 1MW: 60% of the blended generation rate

To get the total electric bill, the value of the energy exported by the customer will be subtracted from the value of the imported energy from Meralco. On the other hand, for a customer enrolled in DER for end-user’s consumption only, the total electric bill shall be the amount computed corresponding to the much lower import consumption.

Benefits of DER

Aside from the compensation provided by the DER Rules to the excess energy exported by RE systems, applying for DER ensures that the RE installation is compatible with the power grid, and shows support for more sustainable sources of energy to reduce dependence on imported fossil fuels.

Compensation from the exported energy
Compliance to interconnection standards for safe and reliable operations
Contribution to the development of local RE resources

Risks of Not Registering RE Installations with Meralco

If Meralco is unaware that you have an RE installation, you put you and your business, other customers, and the Meralco linemen and network at the risk of:

Electrical fires
Electrocution of power utility personnel
Inaccurate billing
Damage to motors and electrical equipment
Neighborhood blackouts
Grid instability
Service interruption

DER Application Process

When you apply a Distributed Energy Resource (DER) facility that is meant for End-User consumption and export, Meralco will replace your current meter and install a bi-directional meter for your business. The bi-directional meter measures both energy you get from the distribution utility (i.e., Import Energy), such as Meralco, and the excess energy produced by your DER installation that is exported back to it (i.e., Export Energy).

Similarly, a Renewable Energy Certificate (REC) meter will be installed to measure the total RE generated by the DER system. The readings from the REC meter will be used as a basis for the computation of subsidies, discounts and for compliance with the Renewable Portfolio Standards (RPS).

For non-exporting DER, on the other hand, the basis for the payment of Lifeline Subsidy Rate, Senior Citizen Subsidy Rate and other relevant subsidies shall be the End-User’s actual energy consumption.

Step 1

Application

Step 2

Evaluation

Step 3

Inspection

Step 4

Energization

1. Application

To apply for DER, please submit the following requirements:

Requirements
a. Letter of Intent	Signed by authorized signatory and send to Meralco
b. Identification documents	DTI Registration, Secretary's Certificate/Board Resolution; Securities Exchange Commission ("SEC") Registration; Most recent Articles of Incorporation (AOT) and General information Sheet ("GIS") For Authorized Representatives: Any valid government ID Letter of Authorization
c. Updated Electrical Plan, duly signed and sealed by the Professional Electrical Engineer (PEE)	Secure from PEE
d. Certificate of Final Electrical Inspection (CFBI)	Secure from your LGU (For applicable customers - PEZA)
e. Application Form for Interconnection of DER Facility	Get this from Meralco. Fill out and sign.
f. List of Certified Equipment	Get this from your RE installer
g. Plant Parameters Form (PPF) including Detailed Planning Data	Get this from Meralco. Please ask your solar installer to fill out
h. Fixed Asset Boundary Document (FABD)	Get this from Meralco. Fill out and sign.
i. Certificate of Compliance (COC) Form 1- applies to individuals Form 2-applies to non individuals e.g. corporations, organizations	Get ERC Form from Meralco. Fill up and pay fees.
j. Renewable DER Supply Agreement with Distribution Utility (for Exporting); or Interconnection Agreement (for Non-Exporting)	Get this from Meralco. Fill out and sign.
k. Environmental Compliance Certificate (ECC)	Secure from DENR-EMB (as applicable)
l. DU Certificate	Get this from Meralco
m. Permit to Operate (PTO)	Secure from DENR-EMB (as applicable)
n. Management and/or Lease Contracts in Force	Secure from DER provider
Fees:
o. COC Application Fee	Php 1,500 Prepare Manager's Check or Cashier's Check payable to “Energy Regulatory Commission”
p. Difference in Meter Cost (DIMC) fee (if applicable)	To be collected from DER customers with existing service with Meralco. DIMC fee is the difference between their existing meter and the new bi-directional meter to be installed.

To compare DER with other RE programs such as Net-Metering (NM) and Zero Export (ZE) expand the table below:

Net-Metering (NM), Zero Export (ZE) and Distributed Energy Resource (DER) Requirements Comparison

	Net Metering (NM)	Zero Export (ZE) / Self Generating Facility (SGF) & Distributed Energy Resource (DER) for End-User Consumption Only	Distributed Energy Resource (DER) for End-User Consumption and Export
Definition	A program that allows customers to install a renewable energy (RE) facility within their premises, with a capacity of up to 100kW, to export excess electricity to the distribution utility, i.e. MERALCO.	Customers with ZE / SGF* use the electricity generated by the RE facility they own for their own consumption. Similarly, DER for End-User consumption only utilize any generation or storage technology, whether on- or off-grid, so long as the End-User and owner of the facility are not the same entity. *excludes household, clinics, hospitals and other medical facilities	Distributed Energy Sources (DER) utilizing renewable power sources for End-User consumption and export whether on-grid (nameplate capacity greater than 100kW up to 1MW) or off-grid (nameplate capacity not greater than 1MW).
Requirements
1. Identification documents For Residential: - ID & Proof of Valid Occupancy For Business: Secretary's Certificate	✔	✔	✔
2. Plant Parameters Form (PPF)	✔	✔ Get this from Meralco. Please ask your solar installer to fill out	✔
3. List of Certified Equipment	✔	✔ From your RE installer	✔
4. Certification of Final Electrical Inspection (CFEI)	✔	✔ Secure from LGU *For applicable customers - PEZA	✔
5. DU Agreement	✔ Amended Net Metering Agreement	✔ Interconnection Agreement Get this from Meralco. Fill out, sign, and have it notarized.	✔ Renewable DER Supply Agreement
6. Fixed Asset Boundary Document (FABD)	✔	✔ Get this from Meralco. Fill out and sign.	✔
7. Application Form for Interconnection of RE / DER Facility	✔	✔ Get this from Meralco.	✔
8. Updated Electrical Plan, duly signed and sealed by the Professional Electrical Engineer (PEE)	✔	✔ Secure from PEE	✔
9. DU Certificate	✔	✔ Get this from Meralco.	✔
10. Certificate of Compliance (COC) Form 1 - applies to individuals Form 2 - applies to non-individuals e.g. corporations, organizations - Php 1,500 COC application fee paid to ERC	✔	✔ Get ERC form from Meralco. Fill up and pay fees	✔
11. Other COC Filing Requirements: - DU Certificate - Renewable DER Supply Agreement - Permit to Operate - Environmental Compliance Certificate - Management or Lease Contract in Force	✘	✘	✔ Secure from Meralco. DENR-EMB & DER Operator

2. Technical Evaluation for DER

Meralco will evaluate your application and requirements through a Distribution Impact Study (DIS).

The DIS assesses the potential effect of your solar installation on our distribution system. If the results show that an upgrade of the electrical facilities are needed, a Distribution Assess Study (DAS) will be conducted. The DAS determines all distribution assets and costs necessary to accommodate a proposed interconnection.

After these, we will advise your DER provider the proper interconnection of the installation to your load and to the Meralco system. Your DER provider shall then finalize the details of the interconnection.

Applicaton Type	Distributed Energy Resources (DER)
Study	Distribution Impact Study (DIS)
Rationale	The DIS assesses the ability of the Distribution System to safely and reliably accommodate a proposed Connection Agreement and any upgrades that may be required.
Types & Fees*	Type 1: < 5kW (Php 1,900) Type 2: 5kW to 100kW (Php 17,700) Type 3: 101kW to 200kW (Php 30,000) Type 4: 201kW to 999kW (Php 40,000) Type 5: >= 1MW (Php 70,000) *NOTE: For exporting DER, no fees shall be imposed on the conduct of the DIS
Assessment (as needed)	Technical Impact Study/ Field Verification / Systems Parameter Measurements
Inclusive of (as needed)	1. Circuit modelling 2. Load flow and short circuit analysis 3. Voltage study 4. Verification of penetration limits 5. Field verification of existing secondary distribution 6. Load profiling 7. Measurement of baseline system and power quality parameters 8. Verification of thermal leading and voltages
Description	Meralco simulates the proposed RE installation to the customer's load and its impact to the grid. This is to determine if the proposed RE installation will be safe to the customer and neighboring grid, or if additional facilities are needed. The simulations are performed off-line and do no cause interruption to the customer's use of electricity.
Study	Distribution Asset Study (DAS)
Rationale	The DAS will determine all distribution assets and costs necessary to accommodate a proposed interconnection.
Type & Fees	Depending on the DIS Result if needed. Cost is variable depending on the capacity and complexity of the project.

3. Inspection and approval of your service entrance

We will inspect your facility and service entrance to ensure compliance with DER standards.

For end-user consumption and exporting DER

Upon approval of your service entrance, completion of all documentary requirements, payment of the fees, installation of all necessary electrical assets, and securing all the certificates and permits, Meralco will then replace the existing meter with a bi-directional meter, install a REC meter, and do testing and commissioning activities of the RE system.

For end-user consumption DER

The process is the same, with the exception of the replacement of the existing meter with a bi-directional meter as well as the need to install a REC meter, as there is no excess energy that will be exported to the grid.

4. Powering up your installation

Once your DER facility has been fully commissioned, and upon securing the Certificate of Compliance (COC) with the ERC, you can now safely use and enjoy the benefits of your DER installation.

To learn more, book a free Power Consult today via biz@meralco.com.ph, business hotline 16210, or your Biz Partner Manager.

Book a free Power Consult