Renewable power in the Philippines: FIT for purpose - Law.asia
Published November 22, 2025
Renewable Energy in the Philippines: A Focus on Feed-in Tariffs
The Philippines has been making strides in the renewable energy sector, particularly through its implementation of Feed-in Tariffs (FIT). This mechanism has played a crucial role in incentivizing the development of renewable energy sources, such as solar, wind, hydro, and biomass, contributing to the country’s energy security and sustainability goals.
Overview of the Feed-in Tariff System
The Feed-in Tariff system was established in the Philippines under the Renewable Energy Act of 2008, which aimed to promote the development and utilization of renewable energy resources. The FIT system guarantees fixed payments to renewable energy producers for the electricity they generate and feed into the grid over a specified period, typically 20 years. This long-term contract provides financial stability and encourages investment in renewable energy projects.
Growth of Renewable Energy Capacity
Since the introduction of the FIT system, the renewable energy capacity in the Philippines has seen significant growth. As of the latest reports, the total installed capacity of renewable energy sources has reached approximately 6,000 megawatts (MW). This includes various technologies, with solar and wind energy leading the way.
Solar energy capacity has surged, driven by falling costs of solar photovoltaic (PV) technology and favorable government policies. Wind energy has also gained traction, with several wind farms operational across the country, particularly in regions with high wind potential such as Ilocos Norte and Cebu.
Current Status of Feed-in Tariff Application
As of now, the Department of Energy (DOE) of the Philippines has set specific FIT rates for different renewable energy sources. The FIT rates are designed to be attractive enough to encourage investment while ensuring that the costs are manageable for consumers. The current FIT rates are as follows:
- Solar: PHP 8.69 per kilowatt-hour (kWh)
- Wind: PHP 7.40 per kWh
- Hydropower: PHP 5.45 per kWh
- Biomass: PHP 6.63 per kWh
These rates are subject to periodic review and adjustment based on market conditions and the cost of renewable energy technologies.
Challenges Facing the FIT System
Despite its successes, the FIT system in the Philippines faces several challenges. One major issue is the limited capacity of the grid to accommodate the increasing influx of renewable energy. The existing grid infrastructure requires upgrades to handle the variability and distributed nature of renewable energy sources.
Additionally, there have been concerns regarding the sustainability of the FIT rates. As the number of renewable energy projects increases, the financial burden on consumers could rise, leading to potential pushback against the FIT system. The government is tasked with balancing the need for renewable energy development with the affordability of electricity for consumers.
Future Outlook for Renewable Energy in the Philippines
The future of renewable energy in the Philippines looks promising, with the government aiming to increase the share of renewable energy in the energy mix to 35% by 2030. This goal aligns with the country’s commitment to the Paris Agreement and its efforts to reduce greenhouse gas emissions.
In addition to the FIT system, the Philippine government is exploring other mechanisms to support renewable energy development. These include net metering, which allows consumers with renewable energy systems to sell excess electricity back to the grid, and the Renewable Portfolio Standards (RPS), which require electricity suppliers to source a certain percentage of their energy from renewable sources.
Conclusion
The Feed-in Tariff system has been instrumental in promoting renewable energy in the Philippines, leading to significant growth in installed capacity. While challenges remain, the government’s commitment to renewable energy development, coupled with supportive policies, bodes well for the future of the sector. Continued investment in renewable energy infrastructure and technology will be essential to achieving the country’s energy goals and ensuring a sustainable energy future.
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