The Department of Energy (DOE) has issued Department Circular (DC) No. DC2026-02-0008, providing a supplemental and amendatory framework to strengthen the implementation of DC No. DC2023-04-0008 or the Energy Storage Systems (ESS) Policy.
The updated framework advances the government’s commitment to a just energy transition by supporting ESS deployment and ensuring its systematic integration in both grid connected and off-grid areas, enabling higher renewable energy penetration while preserving power quality and system reliability.
Under the amendatory Circular, all prospective variable renewable energy (VRE) power plants with an installed capacity of 10 megawatts (MW) and above shall be required to integrate ESS with a capacity of at least 20% of the plant’s installed capacity as part of project development and grid integration, consistent with system studies and technical requirements.
To maximize operational value, the DOE encourages ESS installations to include grid-support capabilities, including but not limited to grid-forming (GFM) inverters that help stabilize voltage and frequency. These capabilities are intended to mitigate the inherent variability of renewable output, enable optimized dispatch, minimize generation losses, and strengthen the grid’s ability to maintain power quality, reliability, and overall system stability.
“Energy storage is not only about storing surplus energy, it is about strengthening the grid’s capability to absorb more renewables while maintaining reliability,” Energy Secretary Sharon S. Garin said. “This policy ensures that ESS integration becomes part of system planning and project development, supporting better outcomes for consumers.”
In addition to the purposes provided under the existing ESS policy, the updated framework recognizes that ESS with virtual inertia or fast-acting system response that supports frequency stability may be deployed to improve the power quality of transmission and distribution networks. The DOE noted that ESS facilities should be considered in grid reinforcements for voltage stability, frequency control, alternative supply in case of islanding (or temporary separation from the main grid), and sufficient ancillary services.
Accordingly, the transmission network provider (TNP) and distribution utilities (DUs) are directed to ensure that ESS facilities are considered in grid reinforcement strategies where storage can provide critical system services and improve overall reliability.
To institutionalize ESS integration, the Circular directs the TNP to include ESS considerations in the preparation of the Transmission Development Plan (TDP) and to recommend guidelines for grid-support capabilities.
The DOE further provides that periodic studies and simulations shall be conducted to support uniform technical requirements for ESS with such capabilities, taking into account relevant international standards and the Philippine Grid Code. The DOE also noted that ESS will be reflected in the next update of the Philippine Energy Plan (PEP) and considered in the review of the TDP, Distribution Development Plan (DDP), and Microgrid Energy Development Plan (MEDP) to ensure that storage is treated as a system resource across planning horizons, supporting both large-scale grid applications and localized solutions for off-grid and missionary areas.
The DOE reaffirmed that the updated ESS framework is designed to strengthen investment signals, improve system performance, and enable the country’s clean energy targets without compromising reliability, accelerating a future-ready power system that can integrate more renewables while maintaining secure and dependable electricity supply for Filipinos.
