The Department of Energy (DOE) of the Philippines has issued a draft circular on the proposed guidelines of the Philippine Geothermal Resource Derisking Facility (PGRDF). The draft circular and accompanying user manual were detailed during a public consultation period, allowing stakeholders to send questions and comments. The DOE is accepting more comments on the draft circular until 25 September 2026.
Officially launched in 2025, the PGRDF seeks to accelerate early-stage geothermal exploration by providing developers with a conditionally repayable loan for exploration drilling. The facility has a total funding amount of PHP 10.7 billion (approx. USD 171 million). A recent update indicated that 12 entities have already expressed interest in applying for the facility.
The PGRDF will cover 50% of eligible costs related to greenfield geothermal site development, while project developers shall contribute the remaining 50% as matching counterpart equity. To qualify for funding, an applicant should meet technical and financial qualifications, and should hold a valid geothermal service contract in good standing and propose a greenfield project. They should also have secured the applicable environmental and social permits and clearances.
Eligible expenditures include site preparation, construction of drilling infrastructure, exploration drilling (standard hole or big hole), and well testing.
Loans will be granted with a six-year tenor. Developers may request for drawdowns during scheduled quarterly windows as eligible expenses are incurred and supported by valid invoices.
Loans are conditionally repayable subject to the success of exploration drilling. Should the proposed project be no longer commercially viable based on technical evaluation, the loan may convert into a grant. This will forgive all repayment obligations of the developer, who will also relinquish the corresponding Geothermal Service Contract.
The Management Team of the PGRDF will conduct orientations and calls for proposals in the second semester of each year, or until the funds have been fully exhausted. Applicant selection will be done in two stages – pre-qualification and full project applications. For the pre-qualification stage, the DOE shall verify eligibility of applicants, while the Asian Development Bank and the Land Bank of the Philippines will conduct environmental and social screening.
Applicants that pass the pre-qualification stage will be issued a conditional Notice to Proceed. This will be valid for six months, during which the developer shall submit a Full Project Application. The application will then undergo technical due diligence by the DOE and an independent third-party peer reviewer, followed by financial and legal credit evaluations by the Land Bank of the Philippines. A successful application will result in a sub-loan agreement.
Source: Manila Standard
