The National Grid Corporation of the Philippines (NGCP) said Tuesday it welcomes the entry of the 2,500-megawatt MTerra Solar Power Project into the country’s power system, while cautioning that the growing share of large-scale solar generation could pose operational challenges to grid stability.

NGCP warned that increased reliance on intermittent sources such as solar power may lead to fluctuations in system frequency and voltage, which, if not properly managed, could result in under-frequency load shedding or rotating power interruptions in some areas.

“Renewable energy initiatives such as the MTerra Solar Power Project are welcome. Any new power source introduced into the system will help keep supply stable. However, not all renewable energy technologies are equal,” NGCP said, noting that wind and solar generation are variable by nature and require closer operational management.

MTerra Solar, a venture by Meralco PowerGen (MGEN) and supported by investors like Actis, has a total capacity of 2,500 MW, supported by a 1,125-MW battery energy storage system (BESS) capable of sustaining output for about four hours. NGCP said the project adds to the country’s renewable energy capacity and supports national goals for a cleaner energy mix.

NGCP said grid stability depends not only on transmission operations but also on the readiness of generating plants to address the inherent variability of renewable energy. It stressed that all facilities required on the plant side, as identified in system impact studies, must be fully complied with.

The company cited a recent voltage fluctuation incident in parts of North Luzon, which it said was caused by unstable output from renewable energy sources in the area. The incident prompted NGCP to implement mitigating measures to prevent further disturbances to the power system.

Drawing from operational experience at the San Marcelino Solar Farm in Zambales, NGCP said short-term solar variability of up to 300 MW can occur due to brief cloud cover. “While such variability can be effectively managed with fast-acting resources, conventional generation (such as coal power plants) has limited capability to respond quickly due to longer ramping times,” the company said.

The grid operator added that battery energy storage systems are among the “fast-acting resources” that play a critical role in maintaining frequency stability as solar penetration in the grid increases.

Under its power supply arrangements, MTerra Solar will supply 850 MW to Manila Electric Co. (Meralco) through a power supply agreement, mainly during daytime hours. The remaining 1,650 MW will be injected into the grid and traded through the Wholesale Electricity Spot Market (WESM).

As a variable renewable energy source, MTerra Solar operates on a must-dispatch basis under Republic Act 9513, which requires priority dispatch for renewable energy facilities such as solar farms.

MTerra Solar has been in development since 2022, with construction ramping up in 2024. The project is being implemented in multiple phases across North and Central Luzon and is one of the largest solar initiatives in Southeast Asia. It is expected to begin partial operations later this year, with full capacity targeted for 2027.  

NGCP reiterated its call on the Department of Energy to adopt more progressive policies governing the entry of variable renewable energy, emphasizing that grid stability should be a primary consideration. The company said the integration of bulk renewable energy capacity should be supported by dependable baseload and fast-ramping resources to ensure a reliable power supply.

How should policymakers and market players balance rapid renewable energy expansion with grid reliability? Share your views.

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