Philippines Eyes Green Energy Auction for Remote Areas

The Department of Energy (DoE) plans to dedicate a green energy auction (GEA) to off-grid areas currently served by the National Power Corp. (NPC), to expedite the shift of these remote communities to hybrid renewable energy systems. “The initiative aims to accelerate the transition of off-grid communities from diesel-based power generation to hybrid renewable energy systems by encouraging private-sector investment in identified off-grid areas,” the DoE said in a statement over the weekend. Currently, island communities and off-grid areas are highly dependent on plants operated by the NPC’s Small Power Utilities Group (SPUG), whose facilities largely run on diesel power. Created by the Electric Power Industry Reform Act of 2001, SPUG is responsible for generating power and operating associated systems in areas not connected to the national transmission grid. NPC operated 217 SPUG plants at the end of 2024. The diesel facilities are exposed to global oil price swings during Middle East crises. At a focus group discussion led by the DoE with potential bidders, the NPC identified 20 priority off-grid areas for the first auction round with a combined annual energy demand of approximately 367,000 megawatt-hours. According to DoE, the proposed GEA program aims to reduce diesel dependence, lower the universal charge for missionary electrification subsidies, and deliver more affordable, reliable, and sustainable electricity to remote areas. The DoE is committed to collaborate with other government agencies and the private sector to advance policies and programs that support the clean energy transition and inclusive electrification. — Sheldeen Joy Talavera