The Philippines' Department of Energy (DOE) has indicated that at least 53 solar projects may face termination due to non-compliance with project timelines. In total, 105 renewable energy projects are under review for possible cancellation, with 88 currently stalled in the predevelopment phase.
While the DOE has not disclosed the developers involved, it noted that most contracts were awarded between 2017 and 2019. Common causes for delays include issues in securing possessory rights and completing system impact studies, which affect grid connectivity.
Developers have two years to complete predevelopment tasks, such as obtaining permits and conducting feasibility studies. If they fail to show reasonable progress within that timeframe, the Renewable Energy Management Bureau (REMB) issues a show-cause order, requiring an explanation for the delays.
If the provided reasons are inadequate or if there's no response, the REMB will recommend contract termination to the Secretary of Energy. Developers may be held responsible for all financial obligations under the service contract, although valid reasons for delays, like force majeure, can lead to extensions.
Energy Undersecretary Rowena Cristina Guevara emphasized the administration's commitment to the efficient execution of renewable energy projects, stating that contracts deemed non-performing will be opened to new developers who can successfully advance these projects.
Earlier this year, the DOE released revised guidelines to manage renewable energy contracts, aiming to filter out "non-serious developers." These guidelines allow developers with certificates of authority (CoA) to secure necessary permits and conduct essential surveys before signing official 25-year contracts. A CoA is valid for two years for floating solar projects and one year for land-based projects.
The DOE is also streamlining the permitting process through its Energy Virtual One-Stop Shop System. In May, the DOE estimated that nearly 2 GW of solar capacity could come online this year, and as of early October, it reported that 29 utility-scale solar projects were approved between January and August. The Philippines aims to install 15 GW of clean energy by 2030, having achieved a cumulative installed solar capacity of 1,675 MW by the end of 2023.
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