The Philippine Department of Energy (DOE) has announced that at least 53 solar projects may be terminated due to non-compliance with project timelines.
The DOE stated it is considering the termination of at least 105 renewable energy projects, with 88 of these stalled in the pre-development phase or showing no progress.
The department has not disclosed the developers involved in these projects but noted that most contracts were signed between 2017 and 2019. Common reasons for delays include failure to secure land rights or complete system impact studies, indicating issues with grid connectivity.
According to current solar contracts in the Philippines, developers have two years to complete pre-development activities, such as obtaining permits, conducting surveys, performing feasibility studies, and securing land rights. If developers fail to complete these preparations or show reasonable progress within this timeframe, the Renewable Energy Management Bureau (REMB) will issue a “show cause” order, requiring developers to explain the delays.
If the reasons provided by developers are deemed insufficient or if they do not respond, REMB will recommend contract termination to the energy secretary, at which point developers must fulfill all financial obligations under the service contract. The DOE noted that projects may be granted extensions in cases of legitimate delays, such as force majeure.
Energy Undersecretary Rowena Cristina Guevara emphasized that the current administration is committed to ensuring the efficient and timely execution of renewable energy projects through regular assessments of their progress and improvements to the regulatory framework.
“If any contract is deemed non-compliant, we will engage new developers who can effectively complete these projects,” Guevara added.
Earlier this year, the DOE released a revised comprehensive guideline for managing renewable energy contracts and registering developers, stating that these reforms aim to identify and eliminate “non-serious developers.” The revised guidelines allow developers with Certificates of Authorization (CoA) to obtain necessary permits and conduct required surveys and preliminary feasibility studies before signing formal 25-year contracts. CoAs for floating solar projects and land-based solar projects are valid for two years and one year, respectively.
The DOE is also streamlining the permitting process through its Energy Virtual One-Stop Service System.
In May, the DOE estimated that nearly 2 GW of solar projects could generate electricity in the Philippines. By early October, the department revealed that 29 utility-scale solar projects had been approved from January to August.
The Philippines aims to install 15 GW of clean energy by 2030. As of the end of 2023, the cumulative installed solar capacity reached 1,675 MW.
