With electricity prices swinging wildly, forward contracts may be the key to predictable energy costs — and a more competitive economy.

For decades, Filipino businesses have struggled with one of Southeast Asia’s most volatile energy markets. With prices fluctuating dramatically day-to-day and uncertainty over generation, energy planning has often felt like a guessing game.

That might be about to change.

A new online platform — Green Tiger Markets — is quietly revolutionizing how electricity is bought and sold in the Philippines. Instead of riding the rollercoaster of spot market prices via the Wholesale Electricity Spot Market (WESM), businesses can now lock in energy rates months in advance, using standardized forward contracts.

“It’s like airfare,” says John Knorring, CEO of Green Tiger Markets. “If you know you’re going to fly, you book early to avoid peak pricing. Why shouldn’t power work the same way?”

The Power Price Problem

In 2024, Luzon’s baseload prices averaged over PHP 5.75/kWh in the first half of the year. For large industrial consumers, that unpredictability made budgeting difficult — and exposed them to costly price spikes during tight supply windows.

“You can’t compete globally if you don’t know what your power will cost next month,” said Carlos Korten, President of GTM. “It’s like starting to cook a meal without checking you’ve got the ingredients.”

The cause? A mix of rising demand, fuel-linked pricing for generation, and a changing supply dynamic with the increase in solar production. 

Enter the Forward Market

Energy forwards are financial contracts that allow buyers and sellers to agree on a fixed power price for a future delivery period. Common across developed markets like the U.S. and Europe, these contracts are now available locally — thanks to a platform built specifically for the Philippine grid.

Green Tiger Market’s marketplace matches buyers and sellers anonymously with contract tenors ranging from months to multiple years. Pricing is transparent, and terms are standardized — making it simple for companies to start hedging.

“What we’re doing is creating price discovery and risk transfer, two things that have been missing from Philippines energy,” Knorring says.

Why It Matters Now

The timing couldn’t be more critical. With new gas capacity entering the grid and solar installations on the rise, the country has a rare opportunity: a more diverse energy mix and falling daytime prices. But that also means greater volatility at the edges — especially during evening demand peaks.

By using forwards, businesses can turn that volatility into an opportunity. For example, locking in a PHP 4.00/kWh rate today for Q4 delivery can offer predictable savings and budget stability.

Early Movers Are Already Hedging

Since its launch in 2023, GTM has registered approximately two-thirds of the country’s generation capacity and one-third of electricity consumption. The platform features a built-in Learning Academy to assist stakeholders in understanding hedging and risk management practices.

GTM’s clients today include many of the country’s major Retail Electricity Suppliers (RES) and independent power producers. Two of the earliest adopters of GTM’s platform include Mabuhay Energy, led by Jacqueline Castillo, and Palm Concepcion Power Company head trader, Alfie Miras. 

The goal? Not to speculate. Just to buy and sell power, more predictably.

A Quiet Revolution

While energy markets can seem opaque and complex, the principle behind forward trading is simple: Plan ahead to gain certainty. It’s a shift in mindset — from reacting to prices to managing them.

For Filipino businesses trying to stay competitive, that might make all the difference.

To learn more about how forward contracts work — and how they can help your business take control of power costs — visit greentigermarkets.com.

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