Philippines Geothermal Energy

The Philippines is one of the top producers of geothermal power in the world due to the country’s location in a volcanic zone, with a total installed capacity of approximately 1.9 gigawatts (GW) of geothermal power. The Philippines’ current electricity generation mix is comprised of 31% coal, 4.2% natural gas, 32.2% oil, 4.1% hydropower, and 14.6% non-hydropower renewables, consisting mainly of geothermal energy generation. Electricity demand in the Philippines is continuing to grow, and the nation’s power grid is expected to face a shortfall of more than 150,000 gigawatt-hours (“GWh”) per year starting in 2040. Geothermal energy is expected to continue to play a major role in the Philippines’ clean energy transition.

The Philippine Department of Energy (DOE) encourages geothermal power development through awarded geothermal service contracts (GSCs) for pre-determined areas to qualified renewable energy developers through the Open and Competitive Selection Process. The GSCs are issued for exploration, development and utilization of geothermal power, covering the entire life of the plant from pre-development to construction and operation. The DOE provides integrated resource assessments of geothermal sites to potential developers, including geology, geochemistry and geophysics surveys.

U.S. companies are encouraged to work with Philippine geothermal energy developers and work on confirming and developing the geothermal resources at identified sites, and incorporate U.S. geothermal technology and equipment, including low enthalpy solutions. The DOE has also opened geothermal projects (and other renewable energy projects) to 100% foreign ownership. These projects can qualify for grant incentives such as a feed-in-tariff program, a seven-year income tax holiday, and tax exemptions for the carbon credits generated from renewable energy sources.

Philippine renewable energy developers frequently seek feasibility and pilot studies to cover all aspects of project development. This can include preparation of the preliminary site development plan; technology assessment and optimization; interconnection analysis and layout; evaluation of financing options; permitting and regulatory review; development of an implementation plan; and a preliminary environmental and social impact assessment.

For more information: Thess Sula, Commercial Specialist, U.S. Commercial Service Philippines at Thess.Sula@trade.gov.