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Philippines Grants Contracts for Microgrids in Unserviced Areas

Philippines issues contracts for microgrids in unserved areas

The Department of Energy (DOE) in the Philippines has recently awarded contracts for the development of microgrid systems in eight underserved regions across the nation, facilitated by its Microgrid Systems Service Provider – Special Bids and Awards Committee (MGSP-SBAC).

This marks the successful conclusion of the inaugural competitive selection process under MGSP-SBAC, with the contract granted to the Maharlika consortium. Comprising Manila-based Maharlika Clean Power Holding, joint venture firm CleanGrid Partners, and Singapore-based renewable energy company WEnergy Global, the consortium is tasked with delivering continuous electricity services to eight areas situated in the provinces of Cebu, Quezon, and Palawan.

These regions will benefit from a dependable power supply through hybrid microgrid systems, which integrate solar, energy storage systems, and diesel gensets.

Philippines Grants Contracts for Microgrids in Unserviced Areas

Philippines Grants Contracts for Microgrids in Unserviced Areas (Credits: Microgrid Knowledge)

The operational commencement of these systems is anticipated within 18 months following the execution of microgrid system service contracts. The DOE has highlighted that electricity tariffs will undergo scrutiny by the Energy Regulatory Commission (ERC) to ensure affordability. Additionally, a 20-year subsidy under the “Universal Charge for Missionary Electrification” initiative has been earmarked to further bolster accessibility.

Looking ahead, the DOE is preparing for a subsequent competitive round under MGSP-SBAC this year. This phase will encompass new unserved regions as well as those areas that did not receive proposals in the initial round.

The selection process adheres closely to the Microgrid Systems Act of the Philippines, which mandates a competitive procedure before conferring authorization upon microgrid service providers operating in off-grid areas. This legislation outlines a strict 90-day timeline from pre-qualification to contract submission to the ERC.

Aligned with the Philippine Energy Plan, the government’s overarching objective is to extend electricity access to all households nationwide by the year 2030.

In a noteworthy development from November 2023, the Maharlika Consortium secured a contract for the construction of hybrid microgrid projects on Panlaitan island and the island of Mindoro.

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