Investors FAQs

Part 2: Renewable Energy Act

Philippine Renewable Energy Act of 2008 (Republic Act No. 9513)

General Information

Q1 What is the primary purpose of the Renewable Energy Act of 2008?
The Act promotes the development and utilization of renewable energy sources, such as solar, wind, and biomass, within the Philippines to achieve energy self-reliance and reduce greenhouse gas emissions.
Q2 What specific energy sources are encompassed under the scope of the Act?
The Act covers:
  • Biomass
  • Geothermal
  • Solar
  • Hydro
  • Wind
  • Ocean energy sources

Fiscal and Policy Incentives

All filings for incentives must be processed through the Department of Energy (DOE).
Q4 What is the Income Tax Holiday (ITH) provision?
Developers are granted an ITH for the first seven (7) years of commercial operations. Expansion projects may receive extensions for a maximum total period of 21 years.
Q7 What corporate tax benefits apply after the ITH period?
After the initial seven-year ITH, a preferential corporate tax rate of 10% is applied to RE developers.
Q10 Is RE-generated power subject to VAT?
No. The Act provides for zero-rated VAT on sales and local purchases of renewable energy-generated power and fuel.

Key Institutions

Q12 Which key institutions were established under the Act?
  • PEMC: Philippine Electricity Market Corporation
  • NREB: National Renewable Energy Board
  • REMB: Renewable Energy Management Bureau
Q14 What are the main powers of the National Renewable Energy Board (NREB)?
The NREB recommends policies on Renewable Portfolio Standards (RPS), oversees implementation of the National Renewable Energy Program (NREP), and manages the RE Trust Fund.

Amendments and Targets

Q16 Has the foreign ownership limit in RE changed recently?
Yes. As of November 2022 (DOE Circular No. 2022-11-0034), the Philippine government now allows 100% foreign ownership in the renewable energy sector, removing the previous 40% cap.
Q17 What are the country's targets for renewable energy share?
Under the NREP 2020-2040:
  • 35% RE share by 2030
  • 50% RE share by 2040