This update was provided by DOE Assistant Secretary Mylene Capongcol to local media. “We are talking to possible [an] implementing partner as our study is almost complete. We’re just looking for a financing partner or an agency that will co-manage the fund or the facility. We are under discussion with various financial firms and agencies.”
Capongcol had also mentioned that the facility seeks to derisk the exploration phase of geothermal development, which is considered the most expensive and riskiest part of the entire development process. The DOE official further guaranteed that the derisking facility will be launched once they have found an ideal implementing partner.
A cost-sharing mechanism
With the assistance of the Asian Development Bank, the DOE has been working to source funds and identify potential partner entities for a Geothermal Resource Derisking Facility (GRDF) for the Philippines. In 2022, the ADB and DOE assigned Amala Clean Energy Advisors (AMALA), along with partners GeothermEx and Parhelion Underwriting, as consultants for the project.
In April 2024, a team from AMALA conducted a workshop in the Philippines to present the proposed design for the GRDF. This was the culmination of an analysis done by AMALA on the geothermal industry in the Philippines The consultancy presented tailor-made solutions for addressing major risks and managing costs for geothermal in the country, in consideration of the costs and risks of the new proposed developments and the major barriers that have stalled the industry’s development over the past two decades.
A cost-sharing mechanism for exploration drilling was proposed, where government funds and private equity jointly finance drilling operations. This proposal was part of an overall “Geothermal De-Risking Roadmap for the Philippines” that aims to address the high resource risks inherent in new greenfield projects that are proposed for development.
