Geothermal handbook: PlanninG and Financing power Generation t e c h n I c a L r e p o r t 2 / 2

B O x 3 . 1 3
Development Assistance and the Philippine Geothermal Success Story
The Philippines has a total installed geothermal power capacity of 1,904 MW and now ranks second in the world 
next to the United States. An aggressive geothermal exploration and development program was formulated 
following the energy crisis of the 1970s and was carried out by Philippine Geothermal Inc. (PGI), a private 
company now with 756 MW of steam field capacity, and PNOC EDC, a government owned and controlled 
corporation now operating 1,149 MW. PNOC EDC implemented its geothermal activities with long-term loans on 
affordable terms from the World Bank and the Japan Bank for International Cooperation (JBIC). To help the energy 
sector develop the country’s geothermal resource potential, the World Bank financed exploration drilling and 
delineation of several areas through sector loans. After establishing technical and financial feasibility, subsequent 
World Bank project loans financed the development and commissioning of 777 MW of geothermal fields and 
power plants. The JBIC helped finance 305 MW, also through project loans.
Source | Dolor 2006.
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SREP operates under the Strategic Climate Fund (SCF) that supports programs with potential for scaled-up, transformational action aimed 
at a specific climate change challenge. SCF is part of the Climate Investment Funds (CIF), which promote international cooperation on climate 
change and support developing countries as they move toward climate resilient development that minimizes GHG emissions and adapt to 
climate change. 
in 2012. The concessional nature of capital supplied by climate finance vehicles, such as CTF and 
SREP,
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coupled with the involvement of major international development organizations, such as 
MDBs, creates unique opportunities for transferring knowledge and leveraging capital from multiple 
sources to support low carbon investments. 
Kenya, one of the six pilot countries selected to benefit from the Scaling-Up Renewable Energy 
Program (SREP) in Low Income Countries funding, proposes to use concessional financing at the 
production drilling phase, which will pave the way for non-concessional or commercial financing in 
subsequent stages of the proposed Menengai 400 MW geothermal project (Table 3.4).