If there is one thing the energy sector can unanimously credit Secretary Sharon Garin for, it is grit: she cuts through bureaucracy, stands toe-to-toe with political power, mobilizes agencies, and brings stalled energy projects back into motion.

Her record is written in resolved bottlenecks, such as right-of-way (ROW) challenges, permit gridlocks, and the fast-tracking of legislative processes for energy-related laws—a capability she mastered during her tenure as DOE Undersecretary. This is not simple praise; it is a mere acknowledgment of where she truly excels and what she can deliver.

Last week, her ‘Iron Lady’ persona didn’t hesitate when she declared to the media that Solar Philippines could face up to ₱24 billion in fines and possible legal action for undelivered renewable energy commitments. The DOE estimated these shortfalls at beyond 12,000MW for the company founded by now-Congressman Leandro Leviste.

Across the industry, the news landed as a “victory moment.” It was widely perceived as the DOE’s long-awaited clampdown on non-performers, signaling that the era of political protection may no longer guarantee immunity.

But the celebration was brief. Unease quickly spread among local and foreign investors scrambling to assess how the DOE’s hardline stance would hit their own project pipelines—especially as unfamiliar policies have suddenly emerged to reshape the rules of engagement.

Secretary Garin was forthright in stating that the cancellation of Leviste’s renewable energy service contracts was neither political retaliation nor tied to his maneuvers in the flood control controversy. Instead, it was presented as a straightforward consequence of failing to deliver on the capacity commitments those contracts demanded.

If the political layer is stripped away, industry players are left to reckon with what this precedent truly signals: is this a clear warning that, in the power industry, promises without follow-through will no longer be consequence-free?

Here is the cold, hard truth: while stakeholders have very little sympathy for Solar Philippines due to its glaring lapses, their cautious optimism is tempered by gnawing fear that this crackdown could trigger an unwarranted domino effect across the industry.

With a precedent now firmly set—and with penalties imposed even on service contracts still in pre-development stages—pressing questions arise: will this tough new standard become the norm for every similarly situated RE contract across the board?

Veterans in the sector remember a time when contract terminations simply involved submitting a formal notice to the DOE, after which the relinquished area was reopened for the next investor. At that time, stiff penalties and legal threats simply did not exist.

In her announcement, the Secretary indicated that Solar Philippines had been repeatedly flagged through official correspondence to meet its committed capacities, yet the company allegedly stayed uncommunicative, ignoring every warning.

What keeps other industry players on edge is the murky math behind the penalty scale and whether the DOE will issue a clear, written policy to spell out these puzzling numbers.

Case in point: In the first Green Energy Auction (GEA-1), Solar Philippines cornered 1,350MW—91 percent of the solar capacities offered. Since winners must post bond deposits worth 20 percent of project costs, a critical question arises: if that bond for undelivered commitments has already been forfeited, would the DOE still layer on additional penalties for the same capacities?

Furthermore, through a strict technical lens, only GEA-awarded power supply agreements and bilateral deals with specific Commercial Operations Dates (CODs) should be considered “committed capacities.” Those at the pre-development stage are classified as “indicative” projects, meaning they may or may not lead to actual commercial development.

Why does this classification matter? Because if terminated contracts were still in pre-development, can they fairly be penalized? These projects often fail due to factors beyond a developer's control: site acquisition hurdles, poor resource viability, financing deadlocks, or grid integration issues. Applying the “Leviste precedent” across the board risks holding projects liable for failures they cannot prevent.

Investors deserve clarity: are companies being penalized for failing to respond to letters, or for failing to deliver capacity? Does being responsive earn you a free pass even if your project is delayed?

Consider the parallelism: one player ignores DOE orders and fails to deliver, while another sends 20 responses yet still misses its commitments. The end result is the same: zero megawatts. Do you punish only the “snobbish” offender, or do both face the music?

Additionally, DOE data shows relinquished and terminated contracts totaling 17,000MW. Yet, only one player has been publicly named—likely because the sheer scale of its failure made it a standout target. If a level playing field matters, shouldn’t those responsible for the remaining 5,000MW of "dead capital" face equal penalties?

Take the offshore wind sector: the DOE touts at least 16 front-runner investors, but many are quietly backing out while stuck in pre-development. If the precedent holds, will these executives also face multi-billion peso legal actions?

Without sugarcoating it, the RE sector has become a breeding ground for opportunistic schemes. In the past, securing an RE service contract cost little more than ₱100,000. Previous administrations were lenient, leaving the system wide open to exploitation.

As a result, while there are fewer than two dozen truly serious players, the sector has been flooded by hundreds of "flippers." This group includes a troubling cast of characters: awardees linked to international financial scandals, individuals under investigation for money laundering, and politicians acquiring contracts solely to flip land for a quick profit.

This underscores a glaring lack of rigorous due diligence by the DOE. By allowing the wrong investors to secure contracts, these projects were doomed from the start. The DOE must clean its own backyard and see past the illusion of a "hot market." Beneath the surface, the industry is becoming a hotbed for scams disguised as legitimate opportunities.

If the DOE does not clearly define its penalty policy, it is easy to imagine Mr. Leviste winning in court and laughing all the way to the bank, while the rest of the sector is left carrying the fallout of regulatory confusion.

At this stage, we must look past personal feelings toward the penalized party. What matters is the integrity of government enforcement. Misreading this moment risks scaring off the very investment dollars the Philippines desperately needs.

The message must be unmistakable: the DOE must clarify whether penalties are aimed at ignored warnings or actual failures to deliver. Leaving investors in the dark only invites future administrations to weaponize vague rules and twist policy intent into political leverage.