Geothermal Developers Seek Pricing Overhaul Ahead of GEA-9

Geothermal developers are calling for a revamp of the pricing mechanism for the government’s upcoming Green Energy Auction (GEA) to better reflect the “true cost” of geothermal power and attract more bidders. The industry aims to encourage greater participation in GEA-9 by ensuring the pricing accurately accounts for development expenses. Jaime Jemuel Austria, Jr., president of the National Geothermal Association of the Philippines, Inc. (NGAP), announced that the group will submit its geothermal pricing recommendations to the Department of Energy (DoE) and the Energy Regulatory Commission (ERC). He emphasized the need to incorporate actual costs associated with geothermal project development, including expenses like road construction. "We explained to the ERC how these kinds of costs should be factored in to be able to come up with a good or a more representative price range of what geothermal really costs," he stated. Mr. Austria highlighted that a single, fixed price is not ideal, as the costs for conventional geothermal plants can vary significantly depending on their location. "What we’re advocating to the ERC is it should be factored in. It’s not a fixed number. They should look specifically at the nature of the geothermal development," he said. In the previous GEA-3, 4,399 megawatts (MW) of renewable energy capacity, including geothermal, impounding hydro, and pump-storage hydro – technologies ineligible for the feed-in tariff (FIT) – were auctioned. However, under GEA-3, the ERC adopted a price determination method to evaluate bids. Despite this, only 30.887 MW of geothermal capacity offers were received, falling short of the 100-MW target. In response to the low uptake, NGAP has "reconvened the technical working group to focus on the areas that can be improved to improve the uptake of the industry, in preparation for the next round of GEA," Mr. Austria explained. The DoE has launched a 10-year GEA program targeting at least 25 gigawatts (GW) of renewable energy capacity for deployment from 2027 to 2035. GEA-9 will cover biomass, geothermal, solar, hydropower, and onshore wind. The Philippines is the world’s third-largest geothermal producer, with geothermal power accounting for approximately 6.4% of the national power mix, representing 2,057 MW of installed geothermal capacity by the end of 2025. An additional potential of around 2,100 MW remains to be explored and developed.