DoE moves to de-risk nuclear development

From AB Capital's The Opening Bell: Three Moves

Event

The Department of Energy (DoE) is drafting the framework for the Philippines' nuclear power auction, with guidelines expected by end-2026 or early 2027. The circular will establish key commercial terms, including cost recovery and incentives for the country's first nuclear project.

View

In our view, the proposed circular is an important de-risking milestone for nuclear development. Greater clarity on project economics and cost recovery should improve bankability and support private-sector participation. Interest has already emerged from several major Philippine energy names, including Aboitiz Power, Meralco, Prime Infra, and San Miguel Corp. We think nuclear could diversify the country's baseload generation mix, strengthen energy security, and reduce reliance on imported fuel.

Catalyst

Key watchpoints include the release of the draft circular, with investor focus on cost recovery, safety oversight, and government support mechanisms.

Action

No near-term earnings impact, but it represents a step toward expanding long-term generation options. We see the most relevance for large integrated power players such as AP and MER, given scale, balance sheets, and early interest in nuclear development.

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