Renewable Energy Market Launches REC Trading in Philippines

The Philippines began trading Renewable Energy Certificates (RECs) on December 26, 2024, marking the full commercial operation of the Renewable Energy Market (REM).

Each REC represents one megawatt-hour (MWh) of electricity generated from renewable sources like solar, wind, hydro, geothermal, and biomass.

The REM provides a platform for trading these certificates, enabling compliance with the Renewable Portfolio Standards (RPS).

“The full commercial operation of the REM is pivotal in advancing the country’s clean energy transition,” said Energy Secretary Raphael P.M. Lotilla.

“It supports compliance with the RPS, fosters investment in renewable energy, and ensures a robust framework for sustainable energy trading.”

The Renewable Energy Act of 2008 established the REM as a cornerstone mechanism to encourage renewable energy development and support the country’s clean energy goals.

The government aims for renewable energy to account for at least 35% of the power generation mix by 2030 and 50% by 2040.

The RPS requires distribution utilities (DUs) and other mandated participants to source a portion of their energy from renewable facilities.

In 2023, the incremental annual RPS requirement for grid-connected areas rose from 1% to 2.5%.

Renewable energy is projected to supply 11.4% of the Philippines’ total power demand in 2024.

Approximately 285 participants, including generators, utilities, and end-users, are expected to register with the REM.

REC trading is anticipated to drive compliance with RPS obligations and spur growth in renewable energy capacity.

Energy Secretary Lotilla commended the Energy Regulatory Commission, the Independent Electricity Market Operator of the Philippines, and other stakeholders for their efforts in operationalizing the REM.

He noted that REC trading will likely grow as demand for renewable energy increases.

The launch of REC trading underscores the Philippines’ commitment to energy security, economic growth, and environmental sustainability.

With the REM fully operational, the country is set to accelerate its transition to a cleaner, greener energy future.