The Philippine Department of Energy (DOE) plans to launch a dedicated Green Energy Auction (GEA) in 2027 for off-grid islands served by the state-owned National Power Corporation (NAPOCOR). The programme will support the replacement of diesel-fired generation with solar power and battery energy storage systems (BESS), with the initial auction expected to cover 20 larger NAPOCOR-served islands. The DOE is finalising the list of eligible islands and auction parameters ahead of the planned rollout.
The programme will be tailored to the operating requirements of off-grid island communities and is intended to reduce reliance on diesel generation while improving energy security and lowering electricity generation costs. DOE Undersecretary Rowena Cristina Guevara said generation costs on off-grid islands average around PHP18 (USD0.29) per kWh, reaching as high as PHP62 (USD1.01) per kWh in some remote locations because of fuel transportation costs. Renewable energy developers, local government units and other stakeholders have participated in focus group discussions to help refine the auction design.
The initiative is also intended to reduce the Universal Charge for Missionary Electrification (UCME), which subsidises the difference between regulated electricity tariffs and the actual cost of generation in off-grid areas. NAPOCOR will continue providing uninterrupted electricity services while successful bidders develop and commission their renewable energy facilities. The DOE is currently completing preparations for the auction, including determining eligible islands and finalising the programme’s implementation parameters.
