As the Philippines’ energy landscape grapples with volatility, a new financial tool is drawing attention from generators, developers, and investors: forward electricity trading. Green Tiger Markets (GTM) is at the center of this shift, offering a digital marketplace for financially settled forward contracts that could reshape project financing and investment decisions.

GTM President Carlos Korten emphasized the gap in the local electricity market. “The spot market doesn’t have a forward signal. There’s a lot of analytics and predictive stuff, but there isn’t some sort of consensus market-driven forward price signal, and that’s where Green Tiger Markets comes in,” he said, addressing participants at the 2nd Philippines Future Energy and Grid Summit 2025.

GTM’s platform allows participants to hedge the future price of electricity, referencing the Luzon Weighted Average Price (LWAP) published by the wholesale electricity spot market (WESM). “We have buyers at PHP 4,100 per megawatt and sellers at PHP 4,400. These price signals are the market consensus for the future price of electricity” Korten explained.

Put simply, GTM enables market participants to hedge against price fluctuations. This is particularly relevant in the Philippines, where electricity prices have been highly volatile in recent years: Luzon baseload power fell from PHP 8.7 /kWh in May 2023 to under PHP 2.6 /kWh in September 2025. Generators without hedges faced sudden revenue shocks, with significant impacts on earnings and profitability.

Forward contracts on GTM operate on a Contract for Difference (CFD) mechanism.

“If you’re a generator and worried that the spot price will collapse, we match you to a counterparty who is worried prices will spike,”Korten explained. “You enter a financial agreement so that when the spot price is low, the buyer pays the shortfall to the seller, and when it’s high, the seller pays the excess to the buyer. The end result is that you can know today what your future revenues will be. It creates price certainty, which is vital for financing, cash flow, and business economics.”

For developers of merchant solar and other renewable projects, the ability to lock in forward prices could make or break project viability. Korten highlighted the changing dynamics of daytime versus evening power. “Midday power has lost, on a notional basis, a half of its value over the last two years. Evening power has been rising steadily… This is a pattern that will become familiar with the onset of more renewable generation,” he said.

Banks and underwriters are also beginning to take notice. “We’ve talked to a lot of the big banks in the Philippines. They’re financially minded and understand that these are the types of cash flows and certainty-based cash flows they’re looking for,” Korten said, pointing to the potential for forward contracts to support project financing even before ground is broken.

Korten added that Green Tiger Markets’ forward trading platform has attracted interest from market observers in Latin America, and Africa, who are reportedly studying the Philippine model for insights into market liberalization and financial hedging practices.

How do you foresee the adoption of forward electricity trading impacting the future of energy investments in the Philippines?

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