Budget for RE development program hiked to P155 million

MANILA, Philippines — The Marcos administration has ramped up funding for the country’s renewable energy (RE) development program this year, fueling the ambitious push toward cleaner, more sustainable power.

The 2025 General Appropriations Act (GAA) has allocated P155.7 million to bolster the Department of Energy (DOE)’s RE policies, marking an 8.4 percent increase from the P143.65 million earmarked in 2024.

The GAA mandates the DOE to strengthen the development, utilization and commercialization of RE resources through the launch of the RE market and the establishment of the green energy option program (GEOP).

The RE market is the venue for the trading of RE certificates equivalent to an amount of power generated from RE facilities, while GEOP gives electricity end-users the freedom to choose RE resources as their energy source.

Similarly, the DOE is also responsible for encouraging the adoption of waste-to-energy facilities, which convert waste into heat, steam, mechanical power or electricity.

These initiatives are in accordance with Republic Act 9513 or the RE Act of 2008, which provides the legal and institutional framework for advancing the country’s RE policies.

To ensure proper utilization of the budget, the DOE is required to submit quarterly reports on its financial and physical accomplishments within 30 days after the end of every quarter.

The increased funding for the RE development program bodes well for the country’s target of expanding the share of renewables in the energy mix to 35 percent by 2030 from the current 22 percent.

Last year, the Philippines ranked as the second most attractive emerging market for RE investments, according to the BloombergNEF Climatescope report.

The Philippines was behind India but ahead of 103 other developing countries. This marks an improvement from 2023’s fourth-place ranking and an impressive leap from 20th place in 2021.

The country’s ascent in the rankings is credited to its effective implementation of energy policies, including feed-in tariffs, net metering, import and value-added tax incentives, priority grid access and RE certificates.

“As the only emerging market in Asia-Pacific with all these mechanisms in place, we are paving the way for a more sustainable energy future, not only for our nation but as a model for the region,” the DOE earlier said.

RE investments accounted for the bulk of the 176 projects endorsed by the Board of Investments (BOI) for green lane treatment last year.

Latest BOI data showed that 141 RE projects worth P4.1 trillion were deemed eligible for green lane processing, which helps streamline, simplify and automate approvals for high-impact projects to ensure swift realization of the investment.

Investments in renewables increased significantly after the government allowed full foreign ownership in the RE sector, which was previously subject to a 40-percent cap.

In particular, 46 of the total certified RE projects in 2024 are majority foreign-owned, while 30 are wholly owned by companies from Singapore, Thailand, Malaysia and the British Virgin Islands.

In terms of equity contributions, Denmark leads with the largest foreign investment at P416.41 billion, followed by the Netherlands (P336.9 billion), Switzerland (P310.7 billion) and Singapore (P230.4 billion).

“Significantly, while most of the renewable energy investment is domestic, we look forward to realizing the potential of increased foreign participation through recent reforms that allow 100 percent foreign equity in RE projects,” the DOE said.