Philippine Geothermal, $1.7 B First Gen Project, $164 M Fund, and 68 Luzon Projects (2025 to 2026)

Philippine Geothermal Expansion Projects, First Gen’s 330 MW Plan Signals Renewed Growth

The Philippines is executing a strategic revitalization of its geothermal sector, moving from a period of incremental maintenance to one of aggressive capacity expansion. This shift is defined by a dual approach of substantial private sector investment in proven assets and government-led de-risking initiatives designed to attract new developers. The recent project announcements and policy measures confirm a clear national priority to leverage geothermal energy’s high reliability for clean baseload power, aiming to reclaim the country’s former position as the world’s second-largest producer.

First Gen’s $1.7 B Tongonan Expansion

The most significant signal of this market acceleration is First Gen’s plan to invest $1.7 billion (100 billion pesos) to expand its geothermal portfolio. Announced in January 2026, this investment includes adding 330 MW of new capacity at its Tongonan geothermal complex in Leyte. This single project represents a substantial increase to the nation’s current installed capacity of approximately 2, 057 MW and underscores incumbent confidence in the long-term viability and profitability of large-scale geothermal power in the country.

New Capacity and Exploration Drilling

Beyond major expansions, the sector shows activity across the project development lifecycle. In August 2025, the 22 MW Tanawon Geothermal Power Plant in Sorsogon was inaugurated by the Energy Development Corporation (EDC), adding new power to the Luzon grid. Concurrently, Maibarara Geothermal Inc. (MGI) is advancing its expansion plans in Batangas. The company contracted Therma Prime Drilling Corp. for an exploration drilling campaign scheduled from October 2026 to May 2027 to support future capacity additions beyond its existing 32 MW, demonstrating a commitment to organic growth through systematic resource validation.

Philippines Solidifies Role in Growing Global Geothermal Market
The global geothermal energy market is projected to exceed $70 billion by 2026, growing to an estimated $115 billion by 2035. The Philippines consistently maintains a significant segment of this market, demonstrating ongoing operational capacity and sustained investments in its geothermal sector.

(Source: gminsights.com — via Geothermal Energy in the Philippines Market Report: Size, Growth, Trends & Forecast (2025–2033))

$1.7 B Investment, First Gen Leads Capital Surge in Philippine Geothermal

A significant injection of capital, driven by both private ambition and public policy, is set to underwrite the next phase of Philippine geothermal development. The government’s goal to increase geothermal capacity by 75% by 2035 is being met with concrete financial commitments, creating a favorable environment for project developers and investors. This financial mobilization is crucial for a capital-intensive industry where high upfront costs for exploration and drilling have historically been a major barrier.

Public-Private De-risking Model

The government’s approval of a $164 million geothermal de-risking fund in July 2026 is a foundational policy action. This fund is designed to mitigate the high-risk exploration phase for developers, which is often the biggest hurdle to securing project financing. By absorbing some of the initial financial risk, the government aims to catalyze a wider range of projects, including those pursued by smaller or newer market entrants. This initiative complements the broader target of attracting P 788 billion ($12.6 billion) in total investment needed to reach the nation’s long-term capacity goals.

First Gen’s Landmark Investment

First Gen’s planned $1.7 billion investment serves as the primary private-sector anchor for the country’s geothermal ambitions. This capital allocation is not just for one project but for a broader upgrade and expansion of its geothermal complexes. Such a large-scale commitment from an established player sends a strong market signal that the regulatory and economic conditions are aligning to support major, long-term investments in clean baseload power, similar to how oil and gas giants like Devon Energy are pivoting existing expertise toward geothermal development.

Table: Philippine Geothermal Investment and Funding (2025-2026)

Partnership Dynamics in Philippine Geothermal, MGI and Therma Prime Drilling Deal

Strategic partnerships are proving essential to execute the Philippines’ geothermal growth plans, connecting resource holders with specialized service providers and technology innovators. These collaborations are critical for navigating the technical complexities of geothermal development, from initial exploration drilling to piloting advanced energy conversion systems. The recent agreements highlight a focus on securing execution capabilities to turn development plans into operational assets.

Drilling Partnerships for Expansion

The contract between Maibarara Geothermal Inc. (MGI) and Therma Prime Drilling Corp. for the Maibarara geothermal field is a clear example of a partnership focused on resource expansion. Announced ahead of drilling operations from October 2026 to May 2027, this alliance secures the specialized equipment and expertise needed to explore the potential for additional capacity at an existing site. This model of partnering with dedicated drilling contractors is a standard and necessary step to de-risk resource availability before committing capital to power plant construction, a strategy also employed by players like Halliburton in their clean energy transition.

Technology Piloting with International Support

The introduction of new technologies is being facilitated through internationally supported pilot projects. In January 2025, a Bay Area energy firm, GFE, secured a $1.739 million grant for a pilot project in the Philippines. The project will assess the viability of its proprietary 2-Phase and Steam Dominated Green Loop (2 PSDGL) technology. This type of partnership allows the country to test and potentially adopt next-generation geothermal systems that could improve efficiency or unlock previously uneconomical resources, aligning with the global push for more efficient clean energy seen in the development of geothermal data centers.

Table: Philippine Geothermal Partnerships (2025-2026)

Luzon and Leyte, First Gen Focus on High-Potential Geothermal Regions

Geothermal development in the Philippines is geographically concentrated in regions with proven high-temperature resources, primarily within the Pacific Ring of Fire. Current expansion efforts are centered on maximizing output from these established hubs while simultaneously laying the groundwork for exploration in new frontier areas. This dual focus ensures that both near-term capacity additions and long-term resource pipeline development are addressed.

• The island of Luzon remains the primary demand center and a key focus for development. The Board of Investments has identified 68 potential geothermal projects on the island, signaling a systematic approach to unlocking its vast, untapped potential. The inauguration of the 22 MW Tanawon plant in Sorsogon and the ongoing expansion at the 32 MW Maibarara site in Batangas are recent successes in this region.
• Leyte is home to the country’s largest geothermal complexes, and it continues to be the epicenter of large-scale capacity additions. First Gen’s planned 330 MW expansion at its Tongonan facility solidifies the region’s importance as the backbone of the nation’s geothermal power generation.
• This geographical concentration is similar to development patterns seen in other leading geothermal markets. For example, a handful of states dominate the top 10 US geothermal projects, and development in China’s top 10 geothermal projects is also clustered in specific geological zones, highlighting the resource-dependent nature of the industry.

Technology in Philippine Geothermal, First Gen Employs Proven Tech at Scale

The Philippines’ strategy for geothermal expansion is anchored in the deployment of commercially mature, reliable technologies while selectively piloting next-generation systems. This pragmatic approach prioritizes speed and reliability for achieving national energy targets. The bulk of new capacity will come from conventional flash steam and binary cycle power plants, technologies that have powered the industry for decades.

• Major expansion projects, like First Gen’s plan for Tongonan, rely on well-established flash steam technology. This choice minimizes technological risk and leverages the local industry’s deep operational experience, ensuring that new capacity can be brought online predictably and efficiently.
• Simultaneously, the country is open to innovation through controlled pilot programs. The GFE pilot project, supported by a U.S. grant, is testing a novel 2-Phase and Steam Dominated Green Loop (2 PSDGL) system. While not central to the immediate capacity goals, such pilots are crucial for future-proofing the industry and potentially unlocking efficiency gains or new resource types.
• This balanced technology strategy, combining large-scale deployment of proven systems with targeted innovation, is a hallmark of mature energy markets. It ensures that the country can meet its 24/7 clean power needs, a challenge that tech giants like Google are also tackling with geothermal energy to power their global data center infrastructure.

SWOT Analysis, Philippine Geothermal Capacity and Investment Goals

The Philippine geothermal sector’s revitalization is supported by strong underlying fundamentals but faces significant execution challenges. The nation’s extensive volcanic geology provides a world-class resource base, and a renewed policy focus is creating powerful tailwinds for growth. However, the high capital costs and long lead times inherent to geothermal development remain substantial hurdles that the new de-risking mechanisms aim to address.

Table: SWOT Analysis for Philippine Geothermal Expansion (2022-2026)

Philippine Geothermal Market Targets $1.5B by 2032
The Philippine geothermal energy market is projected for steady growth, expanding from $1.2 billion in 2024 to $1.5 billion by 2032, driven by a 2.1% CAGR from 2025. This indicates a consistent but measured expansion in clean baseload power generation.

(Source: Verified Market Research — via Geothermal for Data Centers 2026: Policy Unlocks Power)

Scenario for Philippine Geothermal, First Gen’s $1.7 B Plan Sets the Pace

The trajectory of the Philippines’ geothermal sector over the next two years will be determined by the successful conversion of ambitious plans into executed projects. The market’s momentum is contingent on both the progress of large-scale incumbent projects and the successful incubation of new developments through government support. Watch for the initial disbursements from the de-risking fund as the first indicator of whether new players are entering the market in response to policy incentives.

• If First Gen’s $1.7 billion expansion plan proceeds through financial investment decision (FID) and breaks ground on schedule, it will validate the economic case for large-scale geothermal in the current market. This could trigger other major asset holders to accelerate their own expansion plans, creating a competitive development environment.
• Watch the initial projects selected for support under the $164 million de-risking fund. If this capital successfully enables new or smaller developers to complete exploratory drilling and prove resources, it signals that the government’s strategy to broaden the market beyond a few incumbents is working.
• These developments could be happening as the demand for firm, 24/7 carbon-free power grows globally, with major corporations like Google securing geothermal offtake agreements to power critical infrastructure like AI data centers. A successful geothermal build-out in the Philippines could position the country as a prime destination for such investments.

The questions your competitors are already asking

This report covers one angle of the Philippine geothermal market’s expansion. The questions that matter most depend on your work.

• New geothermal projects in Luzon Philippines
• Philippine geothermal de-risking fund criteria
• Geothermal energy companies in the Philippines
• New geothermal technology trials Philippines

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