The state of renewable energy in the Philippines, 2026

The Philippines has more renewable capacity than at any point in its history, and coal still generates more than half of its electricity. Both statements are true in 2026, and the distance between them is the state of renewable energy in the country. This piece sets out where the fleet stands, what the targets ask, what the auction programme has awarded so far, and what the year's oil shock changed. Every figure is from IRENA, the Department of Energy, the Energy Regulatory Commission, IEMOP or the Philippine Statistics Authority, with the source named in each section.

Capacity: 10.4 GW of renewables, a third of the fleet

IRENA's Renewable Capacity Statistics 2026 puts the Philippines at 10,436 MW of renewable power capacity at the end of 2025, up from 9,322 MW a year earlier and 6,334 MW in 2016. Renewables were 31.2% of installed capacity in 2025, against 30.1% in 2024 and 28.4% ten years ago. The share barely moved for most of the decade, then rose three points in two years.

The composition explains why. Solar went from 791 MW in 2016 to 3,892 MW in 2025, with 899 MW added in the last year alone, and is now level with hydropower as the largest renewable technology by capacity. Hydropower, 3,889 MW including pumped storage, has grown by 265 MW in ten years. Geothermal stands at 2,057 MW after a step up in 2025, its largest addition in a decade. Wind is 518 MW, its first increase since 2019. Bioenergy is 815 MW: 766 MW of solid biofuels, of which 480 MW is bagasse cogeneration at sugar mills, and 49 MW of biogas, a figure essentially unchanged since 2018.

Source: IRENA, Renewable Capacity Statistics 2026, country tables.

Generation: 22% renewable, 57 to 62% coal

Capacity and generation tell different stories. The DOE's 2024 power statistics record 126,941 GWh of gross generation, of which 28,193 GWh, 22%, came from renewable plants. Coal supplied close to 79,400 GWh, about 62%, and natural gas over 18,000 GWh. Over the twelve months to June 2026, Ember's monthly data, as compiled by Low-Carbon Power, puts coal at about 57%, gas 17%, hydro 11%, geothermal 8%, solar 4% and wind about 1%, with low-carbon sources at 25% of generation.

A 31% capacity share that delivers 22 to 25% of generation is the arithmetic of a solar-led build-out: a solar plant delivers energy for a fraction of the hours a coal or geothermal plant does. It also explains why the next rounds of the auction programme carry storage, and why dispatchable renewables, geothermal, hydro, biomass and waste-to-energy, matter more to the generation target than their capacity numbers suggest.

Sources: DOE, 2024 Philippine Power Statistics (published June 2025); Ember, electricity data, July 2025 to June 2026, via lowcarbonpower.org.

The targets: 35% by 2030, 50% by 2040

The National Renewable Energy Program 2020 to 2040 and the Philippine Energy Plan 2023 to 2050 set the renewable share of generation at 35% by 2030 and 50% by 2040. Distribution utilities are held to it through the Renewable Portfolio Standards, which raise the minimum share of renewable supply each year, with an annual increment that rose from 1% to 2.52% from 2023. The DOE's own estimate of what the 2040 target needs is about 102 GW of new capacity, of which roughly 27 GW solar, 17 GW wind, 6 GW hydro, 2.5 GW geothermal and a few hundred megawatts of biomass.

Measured against 2024's 22%, reaching 35% in four years means adding renewable generation faster than demand grows, while the coal fleet built in the 2010s keeps running under its contracts. That is why the auction programme, rather than the RPS, has become the main instrument.

Sources: DOE, National Renewable Energy Program 2020 to 2040; Philippine Energy Plan 2023 to 2050; ERC, RPS rules.

The auction programme: five rounds, 25 GW by 2035

The Green Energy Auction Program awards 20-year contracts at a reserve price set by the ERC for each technology. Rounds one and two, in 2022 and 2023, selected just over 5 GW between them for delivery in 2024 to 2026, most of it solar. Round three, in 2025, was built for dispatchable capacity and awarded about 7,500 MW: three pumped storage projects totalling 6,950 MW, a 550 MW hydro plant and a 30.9 MW geothermal plant. Round four, awarded on 6 November 2025, is the largest yet: 10,195 MW across 123 projects for delivery in 2026 to 2029, about 4.1 GW of ground-mounted solar, more than 2 GW of floating solar, 1.2 GW of solar with integrated storage, a small rooftop tranche and onshore wind. The ERC's reserve prices for that round were 5.68 pesos per kilowatt-hour for ground-mounted solar, 6.53 for floating solar, 5.40 for solar with storage, 4.48 for rooftop solar and 6.09 for onshore wind. No biomass or waste-to-energy capacity was awarded in round four.

In February 2026 the DOE announced rounds five to nine for 2026 and 2027, with a stated aim of 25 GW auctioned by 2035. Round five, the first offshore-wind-only round, covers 3,300 MW for delivery in 2028 to 2030 at a ceiling of 11 pesos per kilowatt-hour, the highest reserve price to date; registration opened on 2 March and the tenurial agreement between the DOE and PNOC was signed on 29 August. The later rounds are assigned to floating solar and onshore wind, rooftop and solar-plus-storage, specialised solar such as canal-top and agrisolar, and a final round for solar, biomass, geothermal, hydro and onshore wind in 2027.

For the technologies this firm works in, the round that matters is the special round for biomass waste-to-energy: 230 MW at first, later raised to a 400 MW target, at a reserve price of 8.0167 pesos per kilowatt-hour, delivery between September 2028 and March 2029, under 25-year supply agreements. The ERC has separately set a benchmark of 9.2959 pesos for pioneer waste-to-energy facilities. These are the first auction prices in the programme's history that a landfill or a residue-fired plant can bid against.

Sources: DOE, Green Energy Auction Program notices; ERC, Green Energy Auction Reserve resolutions (rounds as stated); DOE press releases of February and July 2026.

What 2026 changed

Three policy decisions landed in the first eight months of the year. Storage of at least 20% of capacity became mandatory for solar and wind plants of 10 MW and above (Department Circular 2026-02-0008). The rules for own-use solar were simplified (Department Circular 2026-08-0017). The biodiesel blend moves to B5 on 1 October 2026. Together with the waste-to-energy round, they mark a shift in emphasis from adding megawatts to adding megawatts that can be dispatched.

The market moved further than the policy. The oil price shock of March and April took Dubai crude from 62 dollars a barrel in December 2025 to 94.7 in May; the consumer price index for diesel was 122.7% higher than a year earlier at its April peak, and headline inflation reached 7.2%, a three-year high. Electricity followed with a lag: the electricity index was 14.4% higher year on year in August. On the wholesale spot market, Luzon averaged 7.95 pesos per kilowatt-hour in the June billing period and 7.30 in July; Mindanao peaked at 12.75. Meralco's overall rate for a typical household was 14.78 pesos per kilowatt-hour in August. Growth slowed to 2.3% in the second quarter, the fourth consecutive quarter of deceleration, and the central bank reversed its easing cycle to 5.00%.

For an industrial energy user the lesson of 2026 is that imported fuel sets the retail price of power with one to two months' delay, and nothing in the domestic fleet buffers it yet. Every megawatt of dispatchable renewable capacity that comes online under the auction programme reduces that exposure a little; the fuel a factory already has on its own site reduces it for that factory now.

Sources: DOE circulars as numbered; PSA, consumer price index, August 2026; World Bank commodity prices; IEMOP, monthly market reports; Meralco rate advisory, August 2026; BSP.

Where biomass and waste-to-energy stand

Bioenergy is 815 MW of the 10,436 MW, under 8% of renewable capacity, and biogas within it has not grown for seven years. The reason is not resource. The IEA's mapping of sustainable biogas potential puts 70% of the world's potential in emerging and developing economies, led by agricultural residues and organic waste, and the Philippines produces rice husk, bagasse, coconut residue, livestock manure and municipal organic waste in quantities the sugar industry alone has shown can run hundreds of megawatts. The reason is that until this year no auction round had a price for dispatchable biomass or waste-to-energy, and the feed-in tariff that built the first wave of biomass plants has been closed to new projects since 2019.

Two things have changed. The waste-to-energy round now carries a reserve price, and industrial users facing a 14% rise in their electricity bills have a fuel that is already on their site and already costs them money to dispose of. There is still no official market price for industrial biomass fuel in the Philippines: the PSA's only series are household sub-indices for wood fuel and charcoal. What a rice mill, a sugar mill, a food processor or a landfill can do with its own residue is answered site by site, from what the site produces, what it pays to dispose of it and what it pays for energy. That is the study this firm does, and it starts with a measured quantity rather than a published index.

Sources: IRENA, Renewable Capacity Statistics 2026; IEA, Interactive map of global biogas and biomethane potential, https://www.iea.org, licence CC BY 4.0; PSA.

What to watch to the end of 2026

The DOE's 2025 power statistics, once published, which will show whether the 2025 solar additions moved the renewable generation share above 22%.

The waste-to-energy auction round: the registration list, the number of projects that clear the 400 MW target, and the awarded prices against the 8.0167 peso reserve.

Round five's offshore wind bids and whether the 11 peso ceiling attracts the 3,300 MW on offer.

The first commercial operation dates from round four in 2026 and the storage that has to accompany them.

The pass-through of the oil shock: the electricity index has lagged fuel by one to two months all year, and the peak may not yet have been reached.

This piece replaces an earlier article of the same title on this site and is updated once a year. The quarterly market brief carries the figures in between.