[en] The present policy on energy development is geared towards harnessing renewable and indigenous energy resource which can offer clean, abundant and efficient power supply for the country. a review of the current generation mix of the power system, especially the Luzon grid will establish a high dependency in imported fuel - oil and coal to power our generating plants. Thus, the policy of reducing dependence on imported fuel will depend largely on the success of tapping the alternative renewable and indigenous sources. The sustainable development era of the 90's brought fresh interest on the performance and commercial viability of indigenous and/or renewable sources of energy such as wind, solar, geothermal, natural gas and water power or hydropower. Among these alternative renewable sources, water or hydropower is the most readily available, and will produce clean domestic source of electricity - no carbon dioxide, sulfur dioxide, nitrous oxide or any other air emissions. The potential is available in most parts of the country that are mountainous and have high rainfall. In terms of production, hydropower leads as the most developed and more proven in terms of commercial viability. It is also more reliable, efficient and less expensive than geothermal, biomass, wind and solar energy, as will be shown later. (author)