The Department of Energy (DOE) is set to announce by the end of June 2025 the schedule for the 3rd Round of the Competitive Selection Process (CSP) for Microgrid System Providers (MGSPs). This crucial initiative aims to bring reliable and sustainable energy to 71 identified lots covering 167 unserved and underserved areas across the Philippines.
Building on insights from previous rounds, the DOE has significantly enhanced the policy and regulatory framework governing microgrid service operations, fostering a more transparent, efficient, and investor-friendly environment for private sector participation.
A cornerstone of these improvements is Department Circular No. DC2025-04-0007, the Revised Implementing Rules and Regulations (IRR) of Republic Act No. 11646, also known as the Microgrid Systems Act. This revised IRR, which took effect on May 13, 2025, streamlines CSP procedures, clarifies microgrid service contract provisions and stakeholder responsibilities, and introduces enhanced incentives for microgrid service provision.
Under the revised IRR, the award of a microgrid service area will automatically qualify the project as an Energy Project of National Significance (EPNS). This designation will fast-track the issuance of necessary permits and licenses from various government agencies. Furthermore, the Notice of Award will now include a Renewable Energy Service Contract (RESC) for the renewable energy components of the microgrid system, subject to the completion of remaining requirements, particularly proof of possessory rights over the service area.
The DOE is actively collaborating with distribution utilities (DUs) and relevant government agencies, including the Department of Environment and Natural Resources (DENR), Department of Transportation (DOTr), Department of Tourism (DOT), and local government units (LGUs), to gather comprehensive data on the energy demand and potential of the areas to be offered in this CSP.
“This 3rd Round of MGSP-CSP marks a pivotal step in our push for total electrification,” said Undersecretary Rowena Cristina L. Guevara. “By streamlining regulatory procedures, introducing policy innovations, and strengthening coordination across government and the private sector, we are sending a clear signal: the Philippines is ready and open for sustainable microgrid investments. Through these efforts, we aim to empower our most remote communities with clean, reliable, and affordable energy, because energy access is not just a policy objective — it is a fundamental right.”
To further de-risk investments and enhance proponent security, the DOE has also introduced more flexible contractual terms and exemptions from certain financial obligations under Energy Regulations No. 1-94, which pertains to benefits to host communities, as well as selected obligations under the RESC. These provisions will be clearly articulated in the Notice of Award and formalized in the Microgrid System Provider Service Contract with the National Power Corporation.
Through these comprehensive initiatives, the DOE is committed to creating a robust and enabling environment for microgrid investments, thereby accelerating energy access in the country’s unserved and underserved areas and fulfilling the vision of total electrification.
