The Philippines’ Energy Regulatory Commission (ERC) has granted provisional approval for an ancillary services contract between grid operator National Grid Corp. of the Philippines (NGCP) and East Asia Utilities Corp. (EAUC) for a battery energy storage system in Mactan, Lapu-Lapu City, Cebu.
Under the five-year agreement, EAUC’s 44.72 MW battery will provide up to 13 MW of firm regulating reserve and 13 MW of firm contingency reserve. As firm capacity, EAUC must keep it available and faces penalties if it does not. EAUC is a subsidiary of AboitizPower.
The ERC set a provisional rate of PHP 5.28 ($0.084)/kWh for both reserves, which it said is lower than spot prices in the Visayas reserve market, where prices have averaged around PHP 21/kWh. The regulator said securing capacity through the contract means lower ancillary services costs for consumers than relying on the spot market.
The ERC said it acted within days of the filing because of the tight reserve situation in the Visayas, where the grid logged 123 yellow and red alerts from January to early September. The region has 40 MW of firm regulating reserve and 67.3 MW of firm contingency reserve under contract, against requirements of 67 MW and 75 MW, respectively.
“The Visayas needs additional capacities now, not months from now,” said ERC Chairperson and CEO Francis Saturnino C. Juan. “We gave this application priority because every additional firm, reliable reserve in the grid helps reduce the chance of yellow alerts and the disruption they cause.”
The approval is conditional on EAUC obtaining ancillary services accreditation from NGCP and a certificate of compliance from the ERC. NGCP must schedule the contracted capacity at least cost and report monthly on the ancillary services costs it passes on to consumers. The ERC will hold hearings on the application on Nov. 3 and Nov. 10 before a final decision.
The EAUC battery is one of the projects the Department of Energy (DOE) has identified to address the Visayas shortfall. The DOE said recurring alerts began on May 12, when several major generating facilities went offline at the same time. It is working with power companies to deploy 253 MW of battery storage across Cebu, Panay, Leyte and Negros, targeted for completion by the end of 2026, and estimates that about 200 MW of batteries in the region could cut alerts by around half.
AboitizPower announced the Mactan battery as a 30 MW hybrid project in 2025. It has not disclosed the system’s energy capacity or supplier.
AboitizPower already earns ancillary services revenue from storage in Luzon through its 50/50 joint venture with Scatec, which has operated a 24 MW battery at the Magat hydropower plant since 2024 and reached financial close last year on a further 56 MW at the Magat and Binga plants. The DOE is also requiring all ground-mounted solar in its seventh green energy auction to include battery storage.
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