Metro Manila (CNN Philippines) — Work has begun on the country's largest solar farm, and it is set to become operational by the end of this year.

Local firm Solar Philippines broke ground on the 150-megawatt farm in Concepcion, Tarlac on Friday. It will be able to power up to 300,000 households, offsetting an estimated 3 million tons of carbon emissions over its 30-year life, the company said in a statement.

Solar Philippines President Leandro Leviste said in an interview, the initial project cost was roughly $1 million per megawatt, putting total investment in the Concepcion farm at about ₱7.5 billion.

However, he explained costs could still be brought down over time. "We do our own development, construction, financing and panel manufacturing. These four areas are where we can cut our costs significantly."

The Concepcion farm will be the first to feature solar panels made completely in the country. Solar Philippines' Batangas factory started production this month.

"All around the world, country after country is transitioning away from expensive fossil fuels, putting aside any consideration of the environment -- purely on economics -- because solar energy is already proven to be cheaper than fossil fuels," Leviste said.

Birthday wish

Meanwhile, the Department of Energy said the project was a welcome addition to the country's portfolio of power plants.

"Supply is barely meeting demand. We need more. For the Philippines, we have set our target to have a 25% reserve above peak demand," Energy Secretary Alfonso Cusi said during the launch.

The country's total installed power capacity was at more than 20,000 MW as of June 2016. However, the average available power capacity was at only 13,900 MW. As of last June, demand peaked at 13,200 MW.

The urgency is growing, Cusi stressed, especially with the hot summer months already starting. Already, the Luzon power grid was put on yellow alert on March 1 as eight power plants had to go offline for maintenance.

Leviste -- who celebrated only his 24th birthday on the eve of the groundbreaking -- said solar energy could soon fill this gap.

Solar Philippines is undertaking research on battery options for the Concepcion solar farm. It aims to store solar energy for up to 24 hours so it can be used even during the night-time.

"This way, we can have solar energy on a dispatch basis, not on an as-available basis," he explained.

'Hub for solar energy'

The Concepcion solar farm is expected to create 3,000 jobs in Tarlac, from construction to operations. The barangay, municipal, provincial and regional governments also stand to gain 1 centavo for each kilowatt-hour of electricity sales.

Concepcion Mayor Andy Lacson said the municipality could easily become a hub for solar energy in the country, with its flat terrain and hot climate.

Solar Philippines is setting its sights on the Mimaropa (Mindoro Occidental, Mindoro Oriental, Marinduque, Romblon and Palawan) and Visayan regions next.

These island communities tend to be disconnected from the national grid, and solar energy can give them an independent source of power, Leviste said.