In June 2026, MCC’s Board of Directors approved the $60 million Philippines Energy Threshold Program to assist the Government of the Republic of the Philippines in addressing the high cost and unreliability of power in the country by modernizing governance of the energy sector. The program builds upon combined U.S. government efforts and fills critical gaps that will enable energy sector investment, strengthen energy sector institutions, create a growth-enabling energy environment, and expand opportunities for broader commercial engagement.
The high cost and unreliability of power in the Philippines reduces the efficiency of production and limits business expansion. Firms in the Philippines face electricity rates that are the highest in Southeast Asia, especially affecting power-intensive sectors, such as manufacturing, mining, and cold storage. Despite high electricity rates, the Philippines’ power sector struggles to supply reliable power, especially outside the greater Manila metro area, further exacerbating growth challenges outside the capital. Additionally, the limited generation, especially in transmission-disconnected regions, raises the costs of electricity, limiting economic opportunity.
The Philippines Energy Threshold Program aims to reduce high electricity costs and improve reliability through two projects.
Financials
Financials as of September 10, 2026
Program Budget
Milestones
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Signed:
September 10, 2026
Program Projects
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$46,000,000
Project Total Amount
The Energy Development Governance Efficiency Project aims to empower electric cooperatives to deliver reliable, resilient, and financially sustainable power supply by improving processes at the national and local levels for efficient operations and accountable governance of electricity systems. The project will support the Energy Regulatory Commission to streamline regulatory processes and speed investment decisions in the energy sector for transmission, distribution, and generation projects. Further, it will work with a pilot set of electric cooperatives to improve planning for economic growth, while facilitating investment in smart grid technology and embedded generation for baseload or balancing. The project is expected to result in higher quality, lower cost, and more responsive and accountable service delivery that can demonstrate a model to scale across the sector.
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$1,000,000
Project Total Amount
The American Investment Mechanism (AIM) project will provide flexible targeted technical assistance and catalytic funding to accelerate private sector-led energy investments, complementing governance reforms and creating new opportunities for U.S. technology and services in the Philippine energy market.