To balance the country’s portfolio of generation technologies, strengthen power system reliability, and advance the energy transition, the Department of Energy (DOE) has issued a Department Circular (DC) that prescribes a policy framework for the categorization of energy resources and technologies in the energy mix. The policy aims to enhance the sufficiency of generation and ensure the adequacy and reliability of electric power supply across the grid and distribution systems.
The policy recognizes that a reliable power system requires a deliberate mix of resources that can (i) supply electricity continuously, (ii) adjust output as demand changes throughout the day, and (iii) respond rapidly during peak periods, while also providing ancillary services needed to maintain grid stability. By establishing a unified categorization of generation resources, the DOE seeks to improve sector-wide planning consistency, reduce operational risk, and enable an orderly transition toward a cleaner, more resilient, and more self-sufficient energy future.
“Reliability is non-negotiable, even as we accelerate the energy transition,” said Energy Secretary Sharon S. Garin. “This policy provides a systematic approach for matching the right technologies to the right system needs — baseload, mid-merit, and peaking, so that electricity remains secure and affordable while we increase renewable energy integration and reduce dependence on imported fuels.”
Under DC2026-02-0005, to have an optimal energy mix used for electricity generation to meet demand in the grid or in distribution system, the policy classifies system requirements into three (3) load categories, with indicative technology grouping for each:
. Baseload which refers to the continuous and minimum amount of electric power delivered or required to run continuously at a steady rate. It includes firm renewable energy sources and conventional technologies, in the following order – nuclear, new and emerging technologies capable of providing baseload requirements, coal co-firing, and conventional coal.
- Mid-merit, which refers to the variable portion of demand that falls between the baseload and peaking requirements, occurring for a significant number of hours annually. It requires power sources that can adjust their output to follow demand changes throughout the day, which includes: (a) hybrid RE systems; (b) flexible technologies in the following order: gas fired power plants using indigenous natural gas, gas fired power plants using blended natural gas, gas fired power plants using non-indigenous natural gas, hydro, and other highly flexible power plants capable of rapidly adjusting its output; and (c) medium to long duration energy storage technologies.
- Peaking which refers to the highest levels of demand occurring for relatively short durations, typically a few hundred hours annually, requiring rapid response to sudden and sharp increases in demand. This includes fast-start RE technologies; short-duration energy storage technologies; and fast-start conventional technologies.
To support the optimal energy mix, the DOE emphasized that Distribution Utilities (DUs) shall consider the load categorization in their Distribution Development Plans (DDPs), particularly in the Power Supply Procurement Plans (PSPPs), to ensure that procurement decisions reflect system requirements for adequacy, flexibility, and reliability, especially as demand patterns evolve and the grid integrates higher shares of variable renewable energy.
The DOE also encouraged Generation Companies (GenCos) and energy resource developers to align proposed power projects with generation mix requirements and to take into account the load categories in project planning, development timelines, and technology selection.
The DOE underscored that the policy is intended to strengthen planning discipline across the sector by clarifying how various resources contribute to system needs, especially as the grid accommodates higher shares of variable renewable energy and requires sufficient flexibility, fast response, and ancillary services to maintain stability.
