Table of Contents

i MESSAGE

1 EXECUTIVE SUMMARY

08 BALANCING THE ENERGY PORTFOLIO • Conventional Energy (Oil, Gas, Coal) • Downstream Natural Gas • Power Development • Downstream Oil

24 MOVING TOWARDS A CLEAN ENERGY FUTURE • Renewable Energy • Biofuels • Alternative Fuels • Nuclear Power Program • Hydrogen • Smart Grid Policy

36 ENERGY EFFICIENCY FOR A GREEN ECONOMIC RECOVERY

40 ENSURING ENERGY ACCESS FOR ALL

46 INITIATING GOOD GOVERNANCE AND TRANSPARENCY

50 ESTABLISHING A RESILIENT ENERGY SECTOR

58 FOSTERING REGIONAL ALLIANCE

62 LIST OF ISSUANCES

64 DOE OFFICIALS

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 Message

The period 2019-2020 goes down in history as one of the most challenging periods of the 21st century. Our world is plagued with uncertainties and dangers brought about by climate change and the health pandemic. The challenge for government is to do more and to do better.

Amidst the unprecedented economic and health crises, the Philippine Department of Energy (DOE) will continue to deliver its thrust of implementing effective policies that strengthen the Philippine energy sector and guide our nation in navigating these seemingly uncharted waters. The DOE reignites the Philippine energy pathway through the following focus areas:

• Energy security • Resiliency of the energy system • Transition to clean energy and new technologies

The 2019-2020 Energy Sector Accomplishment Report tracks down the major activities undertaken to ensure the achievement of a balanced energy portfolio, a smooth transition to a clean energy future and energy efficiency and conservation towards a green economic recovery and building back better. It commits to reinvigorate an accessible energy for all programs through good governance, transparency and resiliency. It likewise reiterates the significance of a healthy and mutually beneficial regional alliance.

ALFONSO G. CUSI The tasks we are facing are daunting and insurmountable. Secretary Department of Energy To the DOE family, let us remain steadfast and rally behind one another to keep the bayanihan spirit alive in our commitment to serve the people who have put their trust and faith in us.

To all our consumers and stakeholders, we reaffirm our pledge that the DOE will not waver in the delivery of affordable energy that is sustainable and accessible to all, while ensuring a robust and resilient energy system that will continue to serve our people through natural and man- made calamities, today and for generations to come.

Mabuhay!

4i Executive Summary

The DOE remains steadfast with its mission of improving that reached recommendatory status for awarding the quality of life of the Filipinos by formulating and five (5) applications that are currently in post- and implementing policies and programs to ensure evaluation stage. In 2020, two (2) applications sustainable, stable, secure, sufficient, and accessible with total investment cost of USD 50 million were energy. In achieving such mission, the DOE endeavors to recommended to the President for the award of balance between the provision of reliable and reasonably service contracts. priced energy services to support the country’s inclusive growth, and the protection of the environment. Energy Apart from supervising and monitoring 19 active resiliency remains at the core of the DOE’s initiatives to petroleum service contracts (SCs), the DOE also mitigate the impact of any disaster with its adoption in oversees the existing 32 coal operating contracts the planning and programming of energy programs and (COCs) - 22 COCs are in development and projects. production (D/P) stage, four (4) in exploration phase, and six (6) are for conversion from BALANCING THE ENERGY exploration to D/P stage. Semirara Mining and PORTFOLIO Power Corporation remains as the largest coal producer accounting for 90 percent of domestic The realization of energy supply security in the long-term production. requires a harmonious interplay of the various energy sub-sectors. This also entails a well-coordinated energy Downstream Natural Gas value chain for stability, from resource development up to utilization. The corresponding plans and programs Dubbed as the fuel of the future, natural gas is an implemented at the sectoral level are pivotal in assisting energy resource that is deemed to augment the the country’s economy. country’s rising energy demand. The initiatives on the natural gas industry benefitted from the Gas Conventional Energy Policy Development Project (GPDP). The GPDP is a 16-month Technical Assistance (TA) designed to A key development that promotes energy security implement the Philippine Downstream Natural Gas and drives resource exploration in the country is Regulation (PDNGR). The project commenced in President Rodrigo Duterte’s lifting of the moratorium September 2018 and concluded in January 2020 in the West Philippine Sea. The consequent resulting in the formulation of comprehensive resumption of exploration activities for new oil and reference documents – Investors’ Guide and gas fields potentially carries an expected investment Evaluators’ Guidebook and Research Studies on of USD 25 million that may increase to USD 78 Natural Gas in the Philippines. These documents million with the service contractor’s fulfillment of its will ably aid investors, reviewers, and the industry work program commitments. The implementation as a whole. of the Philippine Conventional Energy Contracting Program (PCECP) complements the move to Anchored on the vision of establishing the boosting petroleum exploration. Since its launching Philippines as a liquefied natural gas (LNG) trading in 2018, the DOE processed six (6) area applications and trans-shipment hub that will cater to the Asia-

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 1 Pacific Region, the DOE approved and issued Notice costs (SCC) and stranded debts (SD) transferred to Proceed (NTP) permits from 2018-2020, which to and assumed by the Power Sector Assets and authorized the development and construction of Liabilities Management (PSALM) Corporation. Both three (3) LNG Regasification Terminal projects in SCC and SD form part of the UC and are passed Batangas and one (1) in Quezon. The proposed on to consumers. On the other hand, the latter facilities in Batangas are expected to provide ensures the uninterrupted electricity supply from value proposition considering the existing market generating plants to end-users and protect the of Malampaya while the one in Quezon will serve integrity and reliability of the country’s transmission, potential markets in the neighboring provinces. sub-transmission, and distribution systems. Moreover, construction of these LNG import facilities will require a total capital expenditure of In an effort to ensure continuous supply of PhP 64.6 billion. electricity and assist all industry players despite the pandemic, the DOE issued advisories and Power Sector emergency measures covering: a) deferment of payments and obligations for 30 days (18 March Power remains as one of the fundamental energy 2020); b) continuous operation of generation sub-sectors as electricity is a valued commodity. facilities, WESM, and electric cooperatives (ECs); c) In 2020, the country’s existing installed enhanced community quarantine (ECQ) extension generating capacity increased by 2.8 percent (16 April 2020); d) grace period for electricity reaching 26,250 MW. The ongoing coronavirus bills falling under the ECQ (07 May 2020); and e) disease (COVID-19) pandemic had an impact implementation of a 30-day period and staggered on the demand wherein the country recorded a payment without interests, penalties and other peak demand of 15,282 MW, 1.9 percent lower charges to all payments due within the community compared from the previous year. quarantine in the entire power sector value chain (23 September 2020). With the strain brought by the pandemic, the power sector continued to enhance policies Downstream Oil governing the industry and its stakeholders. These policy issuances include: a) retail market The same with electricity, petroleum products are participation in the Retail Competition and essential commodities that affects the economy’s Open Access (RCOA); b) Wholesale Electricity day-to-day activity. For the downstream oil sector, Spot Market (WESM) covering WESM Mindanao, the country’s inventory level of petroleum products transition to a five-minute WESM, enhancement on stood at 48.8 days of supply equivalent to 2,650 WESM Design/New Market Management System million liters (as of 07 December 2020). This was (NMMS), and establishment of Independent comprised of 35.5 days of on-shore inventory of Market Operator (IMO); c) Embedded Generators; crude and refined products and 13.3 days of supply d) Ancillary Services (AS); e) Direct Connection; in-transit. The inventory level was lower compared f) Performance Audit and Assessment (PAA); to the year ago level of 51 days. g) transfer or relocation of distribution facilities (DOE and Department of Public Works and To ensure that there is sufficient supply, the DOE Highways/DPWH’s Joint Circular); h) Competitive continued to enforce compliance to the minimum Selection Process (CSP); and i) Universal Charge- inventory requirement (MIR). The DOE likewise Missionary Electrification (UCME) Rationalization. monitored the implementation of Executive Order (EO) 113, which temporarily modified the rates of Other significant progressions in the power industry import duty on crude oil and petroleum products were the President’s signing of Republic Act (RA) with the imposition of 10.0 percent tariff effective 6 11371 or the Murang Kuryente Act and RA 11361 May 2020. or the Anti-Obstruction of Power Lines Act. The former aims to reduce power rates in the country With the pandemic causing a reduction in fuel by allocating a share from the Malampaya fund to demand, the DOE was notified in May 2020 by be utilized for the payment of stranded contract Petron and Shell that their respective refineries

2 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 will be on temporary economic/maintenance MOVING TOWARDS A CLEAN ENERGY shutdown. The government was assured by both FUTURE players that there will be no supply disruption, a healthy inventory will be maintained, and supply Spurred on the goal of sustainable development, global will be replenished through importation of finished climate concerns and technology advancement, the products. DOE has intensified efforts towards clean energy fuels and efficient technologies in diversifying the country’s The DOE directed the Philippine National Oil energy supply mix. Innovative approaches and Company (PNOC) to conduct a comprehensive expanded partnership between the government and the feasibility study for the establishment of a private sector have made this aspiration achievable. Strategic Petroleum Reserve (SPR) and prepare a comprehensive implementation plan based on Renewable Energy the study results. Likewise, the Department also promulgated the Revised Guidelines, through The government’s regulatory frameworks on a Department Circular (DC), for the Monitoring renewable energy (RE) provide the platform to of Prices in the Sale of Petroleum Products. The accelerate its development. Completion of policy Circular includes a provision on the Unbundled mechanisms and issuance of new rules and Price Adjustment, which provides details on how oil guidelines created a more conducive environment players arrived at their pump prices. However, such for long-term investments on renewables. policy was challenged in the Taguig City’s Regional Pursuing “prosumer” policies has also been one Trial Court (RTC) and resulted in the issuance of a of the pathways to further revitalize the prospects writ of preliminary injunction on its implementation. of the renewable energy landscape, shifting from The DOE plans to file a motion for reconsideration grid-centered to a more consumer-centered with the Court of Appeals (CA) and even raise the approach. issue to the Supreme Court (SC) if necessary. The establishment of the Green Energy Auction The DOE’s involvement in the implementation of Policy (GEAP) provides an option for the RA 10963 or the Tax Reform for Acceleration and Renewable Portfolio Standard (RPS) compliance Inclusion (TRAIN) Act protected consumers from by mandated participants. The DOE issued the retailers imposing the new excise tax from their old Guidelines Governing the Conduct of GEAP stocks. The effort to ensure the imposition of new in July 2020 as the framework for which the excise tax rates generated savings for consumers Department shall facilitate the conduct of a of about PhP8.0 billion (liquid petroleum fuels) and competitive auction from eligible RE projects. PhP 592.0 million (liquefied petroleum gas/LPG) after the three (3) tranches of implementation. Biofuels

Cognizant of consumer’s safety and protection in the The DOE continues to work on expanding the ongoing pandemic, the DOE sought the assistance production capacities of the biofuel producers of all Metro Manila Mayors to temporarily suspend in the country. The awarding of a Certificate operations of LPG refilling plants and liquid fuel of Accreditation to Archemicals Corporation has retail outlets (LFROs) within their jurisdiction that brought annual biodiesel production capacity to are operating without the necessary permits. This 607.9 million liters. This is expected to increase was in response to online complaints filed to DOE further with the granting of Notice to Proceed at the onset of the pandemic which were mostly (NTP) for the construction of three biodiesel and related to LPG prices, dilapidated cylinders, bote- two bioethanol plants with total annual production bote peddling and lack of necessary permits. capacity of 345.7 million liters.

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 3 Alternative Fuels pertinent IAEA guidelines, relevant laws, rules and regulations. The Committee is chaired and To provide consumers with options on advanced co-chaired by the DOE and DOST, respectively, energy technologies and environment-friendly fuel, with the Department of Environment and Natural the DOE continues to embark on mainstreaming Resources (DENR), Department of Finance (DOF), the alternative fuels and energy technologies Department of Foreign Affairs (DFA), National (AFETs). New policies related to electric vehicles Economic and Development Authority (NEDA), (EVs) and EV charging stations (EVCS) were Philippine Nuclear Research Institute (PNRI), institutionalized as well as research studies on Philippine Institute for Volcanology and Seismology alternative fuel applications and demonstration of (PHILVOLCS), National Power Corporation (NPC) advanced energy technologies were conducted. and National Transmission Company (TransCo) as member agencies. At the onset of the outbreak of the COVID-19 pandemic, a number of the 3,000 units donated Hydrogen e-trikes were utilized by the local government units (LGUs) as service vehicles for emergency response, In an effort to further diversify the country’s delivery of goods and emergency supplies, energy sources, the DOE issued a Special Order transport of frontliners, manning of checkpoints on 25 November 2020 “Directing the Creation and boundaries, and other social services. The of a Hydrogen and Fusion Energy Committee DOE signed four (4) Memorandum of Agreement (HFEC) to Make a Study on Hydrogen and Fusion (MOA) and 36 Deeds of Donation (DOD) with the Energy including Infrastructure Development LGUs and national government agencies for the Methods and Strategies, Prepare a Framework said donated e-trikes. on their Inclusion in the Energy Mix and for Other Purposes.” The study focuses on the impact of Nuclear hydrogen to the country’s energy mix as well as the possibility of hydrogen as an option for power Assessing the viability of the Nuclear Power as and transport fuel supply. a long-term option, the DOE-Nuclear Energy Program Implementing Organization (NEPIO) Smart Grid adopts the Milestone Approach in the Development of a National Infrastructure for Nuclear Power of As the DOE pursues the enhancement and the International Atomic Energy Agency (IAEA) modernization of the country’s entire power system, wherein the 19 infrastructure issues to launch a Secretary Cusi signed the Smart Grid Policy on 06 nuclear energy program need to be addressed. February 2020, “Providing a National Smart Grid One notable accomplishment made in 2018 was Policy Framework for the Philippine Industry and the submission of a “Nuclear Position to Embark Roadmap for Distribution Utilities.” The overall on a Nuclear Power Program (NPP)” to the Office framework includes Smart Power Generation, of the President, which the main action agenda Transmission Modernization, Smart Distribution are the declaration of openness of the Philippines Utility Roadmap, Information Sharing and Education to nuclear power, approval of a Comprehensive Campaigns, Communication Infrastructure Support, Nuclear Law and the issuance of an EO expanding Interoperability, and Cybersecurity. Nationwide the existing composition of the NEPIO. information campaigns with the distribution utilities (DUs) were subsequently conducted in support of Another milestone in the nuclear development was the objectives of the policy. the signing of EO 116 on 24 July 2020 “Directing a Study for the Adoption of a National Position on ENERGY EFFICIENCY & Nuclear Energy Program, constituting a Nuclear CONSERVATION Energy Program Inter-Agency Committee, and for Other Purposes.” The EO established the Nuclear The passage of RA 11285 or the Energy Efficiency Act of Energy Program-Inter-Agency Committee (NEP- 2019 and its Implementing Rules and Regulations (IRR) IAC) to conduct a study for the adoption of a proved to be a bright spot for 2019. This development National Position on NPP in accordance with answered the sector’s call for a mandatory law that will

4 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 address the “business-as-usual” issues on increasing 2020. In particular, the household electrification is already energy demand and rising cost of imported fuels. Among at almost 98 percent in Luzon, 94.6 percent in Visayas the core features of the law include: and 81.3 percent in Mindanao.

The Government Energy Management Program The DOE has been pushing for the 100 percent (GEMP) requires all concerned government electrification target through the Task Force E-Power Mo! agencies to realize at least 10 percent energy (TFEM), which handles the enforcement of the National cost savings from both petroleum and electricity Unified Strategy for Total Electrification Program based consumption (based on their 2015 consumption on the consolidated and reviewed comprehensive Total level). For the period in review, government was Electrification Master Plan (TMP) of the individual DU/EC. able to save 2,393,753.17 kWh of electricity and 530 Based on its 2019 report, 118 ECs (out of 121) and 10 PIOUs thousand liters of fuel. (out of 19) submitted their TMPs.

The Philippine Energy Labeling Program (PELP) Several electrification programs have been carried out and Minimum Energy Performance (MEP) for for continuing implementation in both on-grid and off- Products are mandatory policies for a standard grid areas. These include the Nationwide Intensification performance level on energy consuming products of Household Electrification (NIHE), Barangay Line before they can be sold or used for residential, Enhancement, Sitio Electrification, electrification commercial, transport and industrial purposes. component of the financial benefits under the Energy Regulations (ER) 1-94, solar PV mainstreaming under Designated establishments will be required to the DOE and the European Union-Access to Sustainable submit energy consumption reports to the DOE, Energy Program (EU-ASEP), and the Qualified Third which will form part of the energy consumption Party (QTP) Program. database of the Department. As of December 2020, about 203 commercial establishments and To address some of the challenges in the government’s 96 industrial/manufacturing establishments have pursuit for total electrification, a MOA with the complied with the said policy. Department of the Interior and Local Government (DILG) was entered on 22 March 2019 to direct all LGUs The existing accreditation process of the Energy to cooperate with the DUs in the conduct of inventory Service Companies (ESCOs) will be reinforced of unserved and underserved areas. The National Task through DC 2020-09-0018 that requires the Force to End Local Communist Armed Conflict (NTF- registration of all ESCOs with the DOE. As a result, ELCAC) established through EO 70 also identified the there are 41 registered ESCOs (composed of 20 areas to be provided with electricity service consistent active ESCOs, 20 companies for renewal and one with the TMP submissions of DUs/ECs. (1) company on-process). INITIATING GOOD GOVERNANCE Energy Efficiency and Conservation Awards for AND TRANSPARENCY both government and private sectors will be conducted to recognize and encourage the use of Realizing the important role of energy in the economy, new and effective energy efficiency measures and the government issued policies intended to simplify and practices. streamline the government’s regulatory procedures, while safeguarding the rights of the people engaged in ENSURING ENERGY ACCESS FOR ALL doing business. These include the EO 30, which created the Energy Investment Coordinating Council (EICC) One of the goals of the current administration is achieving and RA 11234 or the “Energy Virtual One Stop Shop full electrification of unserved and underserved areas (EVOSS) Act” was enacted on 19 March 2019. The EVOSS across the country by 2022. With the steady progress is an online platform that intends to facilitate energy on expanding access to electricity, the country is on application process by eliminating redundant processes track to meet this target. The household electrification and documents among government agencies. level now stands at 93.5 percent (June 2020), boosting an additional 292,491 energized households from only The government also issued significant laws to further 23,229,866 in December 2019 up to 23,522,357 in June eradicate inefficiencies in the bureaucracy. These

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 5 are RA 11032 or the “Ease of Doing Business and In times of disasters and calamities, such as tropical Efficient Government Service Delivery Act of 2018 cyclones, earthquakes, and volcanic eruption, the entire (EODB)” and Administrative Order (AO) 23 “Eliminating energy sector worked non-stop and carried out extended Overregulation to Promote Efficiency of Government responses to restore the affected energy services. The Processes” to resolve overregulation and improve the DOE, through the Task Force on Energy Resiliency government system in delivering services to the people. (TFER), was on full alert and consistently monitored and The AO 23 stipulates that the timelines provided for provided energy situation updates in affected areas. For by the EVOSS Act shall be complied and applied to all the power supply, necessary contingency measures and processes/procedures relative to all energy projects. action plans were strategically implemented for the quick restoration of electricity services. The NEA mobilized the To harmonize and fast track the implementation of “Task Force Kapatid” – a bayanihan program that pools EVOSS Law, EODB Law and EO30, the DOE and the together volunteer manpower from different the ECs to Department of Interior and Local Government (DILG) help each other in power restoration and rehabilitation issued the Joint Memorandum Circular (JMC) 2020- efforts. As for the oil supply, the DOE has undertaken the 01 dated 30 April 2020 or the LGU Energy Code. The required measures to ensure the availability of prescribed JMC provides guidelines for LGUs to facilitate the fuel inventory levels and to protect consumers against implementation of energy projects. delays in the delivery of energy services.

ESTABLISHING A RESILIENT ENERGY The global outbreak of COVID-19 changed the SECTOR landscape of disaster response. As “backliners” amidst the pandemic, the energy sector has been proactive to To build a resilient energy infrastructure and secure ensure continuous delivery of energy services in support such facilities in times of emergencies and disasters, of the government’s effort to mitigate and prevent the DOE institutionalized the Energy Resiliency Policy1 spread of the COVID-19. At the onset of the health crisis, (ERP) which aims to strengthen existing infrastructure the DOE issued a policy on “Rationalizing the Utilization facilities, incorporate mitigation improvements into the of ER1-94 Funds by LGUs in Response to COVID-19 Public reconstruction and rehabilitation, improve operational Health Emergency,” which provides for the utilization of and maintenance standards and practices, and develop such funds by the host communities to strengthen their resiliency standards. programs and measures against COVID-19. The DOE also laid out through an AO2 the COVID-19 Response The promulgation of the ERP has driven the advocacy Protocol for the energy sector. Subsequently, the DOE to mainstream energy resiliency into programs, plans and its attached agencies prepared their respective and activities of all industry participants to meet the Public Service Continuity Plan incorporating such resilience goals of the country. The National Energy protocol, while energy industry players were directed to Contingency Plan (NECP) was developed to address submit their respective Business Continuity Plan. both oil and power supply disruption. The DOE, in partnership with the Philippine Disaster Resiliency FOSTERING REGIONAL ALLIANCE Foundation, Inc. (PDRF), is currently updating the NECP, specifically to identify the potential impact of the “Big In this age of globalization, modernization and One” in the entire value chain of the energy sector. technological advancement, the DOE pursues its regional Further, a total of 147 Resiliency Compliance Plans alliances to foster shared development, learnings and (RCPs) were submitted to the DOE across the different friendship. As such, the DOE continues to be a responsible sectors containing adaptation measures, which include and active partner in regional energy cooperation such both structural and non-structural measures options. as: a) Asia Pacific Economic Cooperation (APEC), b) The Energy Resiliency Roadmap will also be developed Association of South East Asian Nations (ASEAN), c) East to set the course and direction of the energy sector to Asia Summit (EAS), and d) Brunei-Indonesia-Malaysia- achieve a higher level of energy resiliency. Philippines East ASEAN Growth Area (BIMP-EAGA).

1 DC 2018-01-0001 titled “Adoption of Energy Resiliency in the Planning and 2 AO 2020-05-0001 Programming of the Energy Sector to Mitigate Potential Impacts of Disasters”

6 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 Highlights of regional energy cooperation activities for power work plans. Secretary Cusi cited the lifting of the period in review include the following: suspension of petroleum activities and resumption of oil and gas exploration in the West Philippine The ASEAN Plan of Action on Energy Cooperation Sea. (APAEC) Phase II: 2021-2025 was adopted during the Virtual 38th Senior Officials Meeting on Participation in the Virtual 59th and 60th APEC Energy (SOME) and Associated Meetings (24- Energy Working Group (EWG) and Associated 27 August 2020). During the said Meeting, the Meetings wherein discussions focused on energy DOE highlighted the need to pursue stronger security initiatives and the EWG current and regional collaborations and cooperation on future initiatives in consideration of the COVID-19 energy resource exploration, development, and pandemic. production within ASEAN’s shared and common borders. On the other hand, the Philippines is working on bilateral agreements/discussions with countries such as India Accordingly, the APAEC Phase II: 2021-2025 was (renewable energy), Japan (LNG, Power Sector and endorsed during the 38th ASEAN Ministers on Waste to Energy), Hungary (nuclear energy), Russia Energy Meeting (AMEM) held on 17-20 November (hydroelectric, natural gas and nuclear energy) and 2020. The DOE also called for joint exploration France (renewables, energy efficiency and conservation, activities among ASEAN member states, as well as alternative fuels, nuclear energy, as well as capacity the importance of integrating resilience in future building on green skills and education).

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 7 BALANCING THE ENERGY PORTFOLIO

In terms of production, 775.9 thousand barrels of oil, 155.7 CONVENTIONAL ENERGY billion standard cubic feet (BCF) of gas and 4 million Indigenous oil, gas and coal resources continue to play barrels (MMB) of associated condensate were realized in an important role in the country’s energy security, as 2019, while 700.1 thousand barrels of oil, 141.5 BCF of gas they contribute to ensuring steady delivery of energy and 3.4 MMB of associated condensate were recovered services to fuel economic growth and development. The in 2020. development of these conventional energy sources helps to reduce dependence on imported energy, and thus Implemented the PCECP improves the country’s energy supply. The Philippine Conventional Energy Contracting A. OIL AND GAS Program (PCECP)3 aims to boost petroleum exploration in the country by allowing the entry of more upstream As of end-December 2020, the country has 19 petroleum petroleum players through flexible modes of licensing. service contracts being supervised and monitored by Since the Program’s launching in 2018, the DOE already the DOE including contracts within the West Philippine processed six (6) area applications that reached Sea. Thus, the lifting of the moratorium on oil and gas recommendatory status for awarding, while five (5) exploration in the area by President Rodrigo R. Duterte is a welcome development since it has allowed contract applications are currently in post-evaluation stage. As holders to resume their exploration activities for new oil of December 2020, two (2) applications – one in the and gas fields in the West Philippines Sea. The President’s Area Nomination and one in the Pre-Determined Area decision is expected to bring in USD25 million in – with a total investment cost of almost USD50 million investments and may increase to USD78 million as they are recommended to the Office of the President for the fulfill their commitments in their work programs. award of service contracts. Through the PCECP, investors are invited to participate and benefit from a potentially- PETROLEUM rewarding partnership to explore and develop the PRODUCTION 2019 2020 country’s indigenous oil and gas resources under one of OIL 775,879 700,116 the most favorable fiscal terms in the ASEAN region. In (in barrels) line with the Program’s objectives, the DOE conducted GAS (in Million Standard Cubic 155,690 141,498 several roadshows/ bilateral meetings and Information, Feet) Education and Communication (IEC) campaigns in 2019 CONDENSATE 4.006 3.480 and 2020, as well as engaged various stakeholders/ (in Million barrels) investors through major investment promotion events.

3 Pursuant to Department Circular (DC) 2017-12-0017 issued on 27 December 2017

8 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 Issued Energy Exploration Policy Directives B. COAL

In 2019, President Duterte issued EO 804 permitting the In 2020, a total of 32 existing coal operating contracts Philippine National Oil Company-Exploration Corporation (COCs) were administered and monitored with respect to (PNOC-EC) to enter into farm-in/farm-out5 agreements. their corresponding work commitments. Of the total, 22 As the petroleum exploration and development arm COCs are in the development and production (D/P) stage, of the government, the PNOC-EC entered into a Joint four (4) active COCs are in the exploration phase, and six (6) COCs are for conversion from exploration to D/P stage. Study Agreement with the DOE on 25 September 2020 to further evaluate the sedimentary basins of the country to On 13 July 2020, the PNOC-EC nominated an area of determine prospectivity. interest in Malangas, Zamboanga Sibugay, while four (4) other companies signified interest to six (6) coal areas in The DOE likewise issued a Department Circular (DC) the country. promulgating the “Rules and Regulations on the Upstream Petroleum Operations Safety, Health, and Environment.”6 Coal production reached 15.3 million metric tons (MMMT) The DC aims to ensure safety and protection against in 2019 but reduced to 13.3 MMMT or 13.2 percent in 2020. hazards to health, life and property as well as pollution of On the other hand, coal consumption reflected a slight air, land and water from upstream petroleum operations. increase from 33.12 MMMT in 2019 to 33.24 MMMT in 2020

The resumption of work [in the West Philippine Sea] would infuse our economy with fresh investments and help generate high-skill employment opportunities.

Sec. ALFONSO G. CUSI During the 38th ASEAN Ministers on Energy Meeting (AMEM)

4 Rationalizing the Rules for the Engagement of Third-Party Participants 5 Refers to a practice, recognized and accepted in the oil and gas under Petroleum Service Contracts, repealing for the Purpose Executive industry, of allowing third party participation to spread the risks inherent in Order No. 556 (s. 2006). Its Implementing Rules and Regulations was signed oil and gas exploration, development, and production. on 13 February 2020. 6 Pursuant to DC 2020-04-0019 signed on 22 April 2020

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 9 OPERATING 32 COAL CONTRACTS 22 Active D/P 4 Exploration 6 For Conversion

due to the steady demand for electricity and energy to manufacture necessary goods and services during the COVID-19 pandemic.

Currently, a total of 289 companies are registered as coal end-users, while 59 companies are accredited as coal

traders. The Semirara Mining and Power Corporation Turn-over ceremony of the Philippine Downstream Natural Gas Industry: is the largest producer of coal in the country providing LNG Investors’ Guide held on 20 February 2020 at the DOE office, Bonifacio more than 90 percent of domestic production. Global City, Taguig City

and financial guidelines, criteria and reviewing the system MILLION METRIC TONS for the project proposals for liquefied natural gas (LNG) 2019 2020 facilities. PRODUCTION 15.27 13.26 To implement the primary objectives of the TA, a Special IMPORTATION 27.69 29.52 Evaluation Committee was created on an on-call basis

CONSUMPTION 33.12 33.24 to provide support to the Downstream Natural Gas Review and Evaluation Committee in the assessment and EXPORTATION 10.24 7.55 evaluation of permit applications.

The TA was completed in January 2020 and was able to produce comprehensive reference documents - the DOWNSTREAM NATURAL GAS Investors’ Guide and the Evaluators’ Guidebook9, as well The DOE, as the oversight agency in ensuring a unified as the Research Studies on Natural Gas in the Philippines. and coordinated effort towards the establishment of a robust natural gas industry, continues to be bullish. LNG Investors’ Guide Hence, relevant policies and programs have been issued and implemented to improve the delivery of reliable The LNG Investors’ Guide contains information on services to energy consumers. potential LNG investments, procedures and requirements in the pre-construction and operation of the facilities, and Implemented the Gas Policy Development Project including permit and clearance requirements from other government agencies. It also provides an overview of the The 2018 Gas Policy Development Project (GPDP) is a LNG industry in the country and the current regulations, 16-month7 Technical Assistance (TA) from the Bureau of incentives and policies on natural gas. Energy Resources of the United Sates-Department of State under the initiative on “Enhancing Development and The Philippine Growth (EDGE) Program in Asia.” The TA was designed Natural Gas Industry: Downstream for the implementation of the Philippine Downstream Outlook and Natural Gas Natural Gas Regulation (PDNGR)8 covering capacity Potential Industry Investments Regulatory building activities, provision of technical advice and 1 2 Frameworks guidance to implement the PDNGR, conduct of research on natural gas industry in the country, and assistance 3 4 in the improvement of PDNGR-related policies. The Incentives and Policies Primer for capacity strengthening focused on best practices and that Facilitate Application lessons learned in evaluating natural gas-related project Investments applications, technical support on technical, economic

7 September 2018-January 2020 9 Serve as a ready reference for energy stakeholders with particular 8 DC 2017-11-0012 issued on 28 November 2017 interest in the LNG sector

10 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 The Guidebook covers four (4) major sections: 1) Natural Gas Industry: Outlook and Potential Investments, which covers the investment areas in an LNG-based industry in the country over the next 25 years; 2) The Philippine Downstream Natural Gas Industry Regulatory Framework, which summarizes the regulations, policies and legislations that support and govern the Philippine Downstream Natural Gas Industry; 3) Incentives and Policies that Facilitate Investments; and the 4) Primer for Application, which contains information on the process and requirements for the application of Notice to Process (NTP), Permit to Construct, Expand, Rehabilitate, and Modify (PCERM) and Senator Sherwin Gatchalian and DOE Secretary Alfonso Cusi joined First Gen Corporation, its wholly-owned subsidiary, First Gen LNG Corporation Permit to Operate and Maintain (POM). and Tokyo Gas Co. Ltd. In a groundbreaking ceremony for the proposed LNG terminal in May 2019 in Batangas On 24 September 2020, the DOE promoted the Investors’ Guide during a webinar on “Philippines: Tapping into the The study analyzed the willingness of the industry World’s LNG Market” conducted by USAID and supported locators within these SEZs to shift from their current by the US-Asia Gas Partnership (AGP) and the United States Energy Association (USEA). energy source to LNG, since the production processes of most of the locators in the SEZs include heating which Evaluator’s Guide uses a more expensive and relatively “dirtier” fuel.

The GPDP’s financial and technical recommendations The study also provides an insight on how awareness and cover the legal and technical parameters for the review information dissemination strategies on natural gas can of applications and the corresponding assessment be improved. Price competitiveness relative to other fuels, forms that aid the DOE and the Security and Exchange such as diesel and liquefied petroleum gas (LPG), is a key Commission (SEC) in the conduct of their review. determinant on how the market will react to the LNG’s entry. Research Study on the Viability of LNG Use Overall, the results of the study suggest a potential On 19 March 2020, the GPDP completed a research study growing market for LNG in the Philippines. to gauge the extent of the potential demand for natural gas among industry locators of the ecozones under Established the Natural Gas Quality Standard the umbrella of the Philippine Economic Zone Authority (PEZA). It also determines the viability of LNG use for The DOE issued a DC on “Implementing the Natural the industry locators within manufacturing and agro- Gas Quality Standard for All-Natural Gas Supply in the industrial Special Economic Zones (SEZs). Philippines.”10 The DC which requires all entities engaged in

10 DC 2019-02-0004 issued on 01 February 2019

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 11 the business of importing, trading, supply and distribution DOE spearheaded the establishment of the necessary of natural gas (or LNG) to end-users to comply with the infrastructures. Philippine National Standard (PNS)/DOE QS 011:2016 “Petroleum Gas - Natural Gas - Quality Specifications.” From 2018-2020, the DOE approved and issued the “Notice to Proceed” permits, authorizing the development The DC requires all businesses engaged in natural gas to and construction of three (3) LNG Regasification Terminal submit the proper reportorial requirements in compliance projects in Batangas and one (1) in Quezon province. The with the PDNGR. The PNS addresses the safety issue proposed LNG import facilities in Batangas is expected since quality variation has implications for the operation to provide value proposition considering the existing of all gas equipment due to the changes in combustion market of the Malampaya gas field, while the LNG facility performance. in Quezon will be serving the potential markets in the nearby provinces. Memorandum of Understanding (MOU) Between Philippine National Oil Company (PNOC) and New The development and construction of these LNG import Fortress Energy (NFE) facilities require a total capital investment of PhP 64.6 billion and expected to mobilize additional investments To further advance the development of infrastructure for the establishment of satellite terminals, transmission to supply a reliable, cost-competitive power and natural and distribution pipelines and refueling stations when gas into the Philippine market, the PNOC signed an MOU with the NFE on 14 October 2020. In this MOU, the PNOC demand for natural gas increases in the near future. and NFE will work together to identify the potential opportunities to accelerate the development of LNG POWER DEVELOPMENT and the power infrastructure in the country. They will As of December 2020, the country’s power generation leverage future investments to build a new and durable capacity increased by 2.8 percent compared with the LNG value chain in the country capable of generating year 2019 level. However, system peak demand declined jobs, revenue, and opportunity far beyond prospective by 1.9 percent than last year’s level due to pandemic, terminal or power plant sites. The DOE joined the virtual which stood at 15,282 MW. The Luzon grid system peak gathering to witness the signing ceremony and to show demand of 11,103 MW, equivalent to 72.7 percent of the the Department’s support to the joint undertaking. total demand, registered a decrease of 241 MW from Realization of LNG Regasification Projects its 2019 peak demand of 11,344 MW. The Visayas grid demand of 2,201 MW (14.4 percent of total) recorded a As the government envisions the country as an LNG slight decline to 23 MW, while the Mindanao grid demand trading and trans-shipment hub that distributes LNG to of 1,978 MW (12.9 percent of the total) was lower by 35 other importing countries in the Asia-Pacific Region, the MW from the 2019 level. The Luzon grid registered a total

LNG REGASIFICATION PROJECTS

Target Notice to Proceed Target Construction Project Location Capacity Operation Date Issued Cost (Million PhP)

Floating Storage & Barangays Sta. Clara, Sta. FGEN LNG Regasification Unit 2022 Rita Aplaya, and Bolbok 5.26 MTPA 7 March 2019 13,284 Corporation (FSRU) Terminal in Batangas City

Floating Storage & Excelerate About 9.5 km offshore in Regasification Unit 2022 1.5 MTPA 20 September 2019 6,387 Energy L.P. Bay of Batangas (FSRU) Terminal

Energy World LNG Storage and Barangay Ibabang Polo, Gas Operations Regasification 2022 Pagbilao Grande Island, 3 MTPA 21 December 2018 7,408 Philippines Inc. Terminal Quezon Province

LNG Storage and Batangas Clean Barangay Pinamucan Regasification 2025 3 MTPA 20 March 2020 37,553 Energy, Inc. Ibaba, Batangas City Terminal

Note: MTPA stands for Million Ton Per Annum

12 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 Table 1. POWER SUPPLY AND DEMAND, PHILIPPINES, 2019-2020

SYSTEM PEAK DEMAND (MW) % SHARE INSTALLED CAPACITY (MW) % SHARE GRID 2019 2020 2019 2020 2019 2020 2019 2020

Luzon 11,344 11,103 72.8 72.7 17,286 17,840 67.7 67.8

Visayas 2,224 2,201 14.3 14.4 3,809 3,863 14.9 14.8

Mindanao 2,013 1,978 12.9 12.9 4,436 4,548 17.4 17.3

Tota l 15,581 15,282 100.0 100.0 25,531 26,250 100.0 100.0

installed capacity of 17,840 MW, nearly 68 percent of Number of CCs per Supplier as of the country’s total capacity. The Visayas and Mindanao October 2020 grids contributed 3,863 MW or 14.8 percent, and 4,548 MW or 17.3 percent of total capacity, respectively. 14% 23% Aboitiz Group Implemented the Retail Competition and Open Ayala Group Access (RCOA) 10% Meralco Group In an effort to widen electricity consumers’ participation in the retail market, the DOE issued the policy through a DC 16% San Miguel Group on Amending Various Issuances on the Implementation 37% of RCOA11. The DC removed mandatory registration of Other RES contestable customers (CCs) in the Wholesale Electricity Spot Market (WESM). This eases the entry into the retail market as mandatory participation in the WESM is now optional for CCs. Corollary to the Circular’s implementation, the Retail Rules and Market Manuals were 1,496 also reviewed and updated. In the course of the review, 16 Registered CCs it considered the Energy Regulatory Commission’s (ERC) CCs 1,133 1 MW - above CCs Rules Supplementing the Switching and Billing Process Switching 363 750 kW - 1 MW CCs and Adopting a Disconnection Policy for CCs.12 The amendment was proposed by the Independent Electricity Participants Registered Market Operator of the Philippines (IEMOP) through the WESM-Rules Change Committee (RCC) and submitted by Contestable Customer 1,496 the Philippine Electricity Market Corporation (PEMC) to 1 MW - above 1,133 the DOE on 19 December 2019. 750 kW - 1 MW 363 Retail Metering Service Provider 54 Around 1,622 participants are already registered in the retail market as of October 2020,13 consisting of 1,496 Retail Electricity Supplier 33 CCs, 54 Retail Metering Service Providers (RMSP), 33 Local Retail Electricity Supplier 14 Retail Electricity Suppliers (RES), 14 Local Retail Electricity Supplier of Last Resort 25 Suppliers (LRES), and 25 Suppliers of Last Resort (SOLR). About 76.0 percent or 1,133 of CCs are those with 1 MW and above demand while the remaining 24 percent falls advantages of the competitive retail market. This also under 1 MW and above 750 kW demand levels. led to an increase in consumption per customer class. The increasing demand from CCs resulted in a decrease There was an increase in the prospective CCs as many in average generation rate, while the suppliers contracted became interested, willing to participate and avail of the price remained constant during the third quarter of 2020.

11 DC 2019-07-0011 issued on 29 July 2019 13 In June 2013, RCOA registered participants reached 961 com- 12 ERC Resolution No. 9, series of 2018 posed of 892 CCs, 19 RES, 13 LRES, 9 SOLRs and 28 RMSP.

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 13 Privatized Government Assets and IPP Contracts Go-Live Conditions The privatization of the government’s power facilities and contracts is among the key features of EPIRA and • Low level of participation by Trading is a prerequisite in establishing a level playing field in Participants in the Parallel Operations the industry. Majority of the government’s privatization Program (POP) that affects the accuracy of efforts were done from 2007-2016 where the major the NMMS market results assets of the National Power Corporation (NPC) and • The DOE approval of the proposed Independent Power Producer (IPP) Contracts with the amendments to the WESM Rules and government were turned over to the private sector. Manuals On the privatization of the NPC generating assets and • ERC approval of the Price Determination IPP Contracts, a combined capacity of 7,956.43 MW Methodology (PDM) has been privatized and relinquished to the winning bidders (Successor Generating Companies or SGCs and Independent Power Producer Administrators or IPPAs) as The WESM’s official launch in 2017 signaled the start of of 30 October 2020. This covered 31 generating assets the Trial Operations. Commercial operation will only sold with a total capacity of 4,601.43 MW, six (6) IPP 15 contracts assigned to IPPAs with contracted capacity of commence once compliance is made with the criteria 3,355 MW, and five (5) decommissioned plants. set forth in the DC.

A total of PhP 915 billion of revenue was generated by In 2019, seven (7) participants were approved with WESM the Power Sector Assets and Liabilities Management registration, while six (6) completed the registration Corporation (PSALM) from the privatization of generation requirements and are awaiting final approval. To address assets, transmission business and IPP contracted the issues on registration of participants, guidance capacities. Actual collection of PSALM stood at PhP in the form of advisories and policy issuances, were 625 billion, leaving a collectible balance of PhP 272 issued by the DOE to the participants to resolve various billion. PSALM was able to achieve 100 percent collection concerns. Consultative fora with specific distribution DUs stemming from the auctioned generating assets and (including LASURECO, MAGELCO and ZAMCELCO) were decommissioned plants. The remaining collectibles also conducted to resolve the special concerns on their are balances from National Transmission Company participation in the WESM. (TransCo) and appointment of IPPAs. The disbursement of collected proceeds is solely intended for the liquidation The DOE monitors all preparatory activities related to of PSALM’s financial obligations as provided in the Electric the full commercial operation of the WESM in Mindanao. Power Industry Reform Act (EPIRA) of 2001. The DOE conducted Readiness Assessment meetings, Participants’ Fora, Focus Group Discussions (FGDs), IEC Developed Policies to Enhance EPIRA Implementation Campaigns, Registration Drive, Site visits to Trading Establishment of Wholesale Electricity Spot Participants, and Hands-on-Trainings from 2017-2020. As Market Mindanao such, the declaration of full commercial operation will be made once the criteria set forth is complied with16. As of As a move to address the influx of generation capacity 16 October 2020, 29 out of 87 expected participants have in the Mindanao grid starting 2016, the DOE promulgated completed registration process, while 53 participants (or a policy through a DC declaring the launch of the WESM 61.0 percent of the expected participants) are pending for in Mindanao and providing for Transition Guidelines14. completion of requirements.

14 DC 2017-05-0009 issued on 04 May 2017 and became effective on metering, and settlement processes of the WESM are fully operational 07 June 2017. in the Mindanao grid; d) Training programs shall have been conducted 15 Section 4 of DC 2017-05-0009 provided the criteria for declaration for the Mindanao WESM Participants; e) The PDM for the enhanced of commercial operations, as follows: a) All systems and procedures WESM design has been approved by the ERC and duly published; and including all interfaces between and among the WESM Participants f) The NMMS has been certified as compliant with the WESM Rules and necessary for the operation of the WESM in the Mindanao grid Market Manuals by an independent auditor. are in place and in conformity with the requirements set under the 16 Criteria include systems and procedure, Trial Operations WESM Rules and Market Manuals; b) The TOP has been successfully Program (TOP), operationalization, trainings, Price Determination implemented; c) The forecasting, scheduling, dispatch, pricing, Methodology (PDM), and New Market Management System (NMMS)

14 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 The WESM Mindanao will operationalize upon the ERC’s and Week-Ahead Projection (WAP) for Luzon and approval of the PDM adopting the five-minute dispatch Visayas (26 October - 25 January 2020); b) Real-Time interval and certification of market readiness and the Dispatch (RTD), DAP, Hour-Ahead Projection (HAP) and interconnections of the Mindanao grid to Luzon and WAP for Mindanao (02 December 2019 to 01 March Visayas. 2020).

Transition to the Five-Minute WESM Considering the crucial role of the PDM approval to commercial operations of the enhanced WESM in Luzon The DOE constantly monitors activities to operationalize and Visayas and the pilot WESM in Mindanao, the DOE the five-minute electricity market pursuant to the DC on strongly recommended to the ERC to fast-track decision “Providing Policies for further enhancement of the WESM on the PDM. All factors considered, the commercial Design and Operation.”17 This will replace the current one operation of the enhanced WESM is expected by 2021. (1) hour trading interval and expected to introduce further improvements in WESM operations and transactions. The Enhancements to WESM Design/New Market core of the preparations were amendments by the DOE Management System of the WESM Rules, review, and approval by the ERC of the PDM, conduct of training and readiness evaluation of The COVID-19 pandemic significantly affected the participants, and the development of the NMMS wherein targets and schedule of activities on WESM Design the features of the five-minute WESM are embedded, Enhancements. including associated systems, such as the Central Registration and Settlement Systems, intended to further The PEMC Board on its letter (28 May 2020) recommended improve the operations of the WESM. to the DOE to further defer the go-live date from 26 June 2020 to 26 December 2020. This was noted by On 01 October 2019, PEMC and IEMOP signed the the Department and emphasized the significance of the Memorandum of Agreement (MOA) on Data Exchange NMMS deployment to fully realize the benefits envisioned and Information, which establishes the collaboration in DC 2015-10-0015. protocols and associated reporting processes to cater to data requests between the said entities, and from other Establishment of Independent Market Operator interested parties. The DOE issued a policy on Adopting Further On 03 December 2019, the ERC ordered PEMC and Amendments to the Wholesale Electricity Spot Market IEMOP for three (3) months coverage of the following (WESM) Rules (Provisions for the Implementation supplemental audits: a) Day-Ahead Projection (DAP) of Independent Market Operator)18 to fulfill the last

(Source: IEMOP website)

17 DC 2015-10-0015 issued on November 2015

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 15 remaining condition stated in the DC on Effective and power industry stakeholders and instrumentalities. The Efficient Transition to the Independent Market Operator DOE and ERC serve as co-chairs of the AS-TWG with for the Wholesale Electricity Spot Market.19 Some of the primary mandate of formulating recommendations the conditions already complied with are the approval relative to existing and future policies and regulations of the Transition Plan on 06 February 2018 and the for the enhancements and/or resolution of issues on the incorporation of an Independent Market Operator (IMO) implementation of AS. Such include the operations of company (concluded on 15 May 2018). The remaining the Reserve Market, technical specifications and testing condition left to be fulfilled for the complete transition guidelines for AS, cost-recovery for AS, selection of third- to IMO is the amendment of the Articles of Incorporation party AS testing entity, and Competitive Selection Process and By-Laws of PEMC, which is expected to be approved (CSP) for AS contracts. any time soon. The AS-TWG signed the Resolution 2020-01 on 28 Policy Framework on Operations of Embedded October 2020, which contains the recommendations Generators issues mentioned above and for issues that need further discussion and resolution by the concerned agencies. The issuance of the policy on Embedded Generators20 Serving as a take-off point, both the DOE and ERC will in 2019 was intended to maximizing the benefits of be assessing their respective existing policies, rules, and embedded generators, while mitigating potential adverse regulations and may incorporate recommendations as impact on grid reliability and security. It introduces criteria applicable. The DOE is currently working on the policy on for mandatory registration of embedded generators Reserve Market Design and other supplemental policies to the WESM based on grid impact, and consequently to the DC on AS. Once draft policy has been finalized, it subject these generators to central dispatch by the SO. will be subjected to Public Consultations for its eventual promulgation, which is targeted by 2021. The DOE is currently in the process of finalizing the amendments aimed to harmonize the WESM Rules and Direct Connection Market Manuals to the provisions of the DC. Pursuant to Section 7.2 and 8.2 of the said Circular, the SO in a letter The application for direct connection to the grid was dated 03 August 2020 drafted a Dispatch Protocol for the formerly part of the jurisdiction of the ERC. In May Embedded Generators providing Ancillary Services (AS). 2014, the ERC endorsed to the DOE all direct connection The DOE reviewed the draft and provided its comments. applications in compliance with the Supreme Court (SC) It was also recommended to involve the MO and the ruling in the Mactan Electric Company, Inc. (MECO) vs. host DU in the finalization of the Dispatch Protocol and NPC, et al. (G.R. No. 172960). The SC’s ruling states that the subsequently undergo the necessary Rules Change subject matter of the dispute between MECO and NPC process to incorporate the amendments to the WESM involved the distribution of energy resource, specifically Rules and Market Manuals. direct supply of electricity, which was not within the Policy Framework for the WESM Reserve Market authority of the ERC to resolve nor the Regional Trial and further policies on AS Court (RTC) as the jurisdiction over the dispute belonged to the DOE. The AS21 policy laid the groundwork and established the guiding principles relative to the procurement and On its 18 December 2018 meeting, the Direct Connection- utilization of AS to ensure the reliability, quality, and Review and Evaluation Committee (D-REC) agreed to security of supply of electric power. It also addresses the issue a moratorium (for a period of 90 working days) prevailing commercial and technical issues associated in on the application for direct connection to give way for the current implementation of these services in the grid. the review and enhancement of the policy “Prescribing the Rules Governing the Review and Evaluation of Direct Pursuant to Section 9 of the DC, the DOE created the Connection Applications of Industrial, Commercial and Ancillary Services – Technical Working Group (AS- Other Electricity End-users.”23 The moratorium for the TWG)22 composed of representatives from various evaluation of applications for direct connection became

17 DC 2015-10-0015 issued on November 2015 21 DC 2019-12-0018 issued on 04 December 2019 and became 18 DC 2020-10-0021 issued on 20 October 2020 effective on 04 January 2020 19 DC 2018-01-0002 issued on 17 January 2018 22 Department Order (DO) 2020-06-0009 issued on 23 June 2020 20 DC 2019-02-0003 issued on 08 February 2019 23 DC 2018-08-0025 issued on 24 August 2018

16 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 now serves as the basis for the review and evaluation Principles of all direct connection applications. The amendment was initiated to enhance the process of the review and Application for Direct Connection to evaluation and to align with the recently promulgated the Grid laws specifically RA 11032 and RA 11234.

• The privilege of direct connection shall only As of October 2020, 15 Direct Connection applications be afforded to high demand electricity End- were reviewed by the DOE – two (2) approved users. applications, one (1) denied for being unqualified based • The issues on reliability and rates are not on the criteria set in the rules, four (4) confirmed, and grounds for the application for direct eight (8) terminated due to non-interest of the applicants connection and such shall be referred to the to pursue the applications. ERC. • Prior to the filing of application, the Initiated the Performance Assessment and Audit Applicant shall apply for connection with the for Power Sector System franchised DU. To achieve a higher standard service delivery in the • The stability and reliability of the Grid shall power industry and as a continuing effort to enhance the be the primary consideration in approving Performance Assessment and Audit (PAA) Policy25 that direct connection application. was adopted in 2017, the DOE is doing the preparation • The applicant’s connection facility for the development of the guidelines providing for the requirements shall not form part of parameters and process of auditing Power Generation, the regulatory asset base of the Transmission and Distribution Systems and Facilities and Transmission Network Provider; and for the development of qualification and accreditation • The DOE shall continue to recognize all process for the third-party auditors. This is after the existing and valid direct connection in force successful evaluation of the lone bidder for the services at the time of the effectivity of these Rules in December 2018. until expiration of their supply contracts with the Generation Company or Supplier. On 29 June, 01 and 03 July 2020, the DOE conducted a series of virtual public consultations (VPC) on the draft effective on 22 March 2019 after posting the same at the policy on PAA, namely “Adopting General Guidelines for DOE website. the Conduct of Performance Assessment and Audit for Electric Power Industry Participants.” The draft policy The Secretary approved and signed the policy “Prescribing aims to establish a comprehensive and sustainable the Rules Governing the Review and Evaluation of Direct mechanism to confirm and validate the electric power Connection Applications of Industrial, Commercial and industry participants’ compliance, as well as lay down the Other Electricity End-users”24 on 09 January 2020. This process on accreditation of third-party auditor who will policy superseded the previous DC 2018-08-0025 and be conducting the audit for the participants.

LIST OF PAA ACTIVITIES FOR 2020

Generation Facilities Distribution Utilities

1. 511-MW Quezon Power (Phils.) Limited Co. Coal-Fired Power Plant in 1. Aurora Electric Cooperative, Inc. Mauban, Quezon 2. Quezon II Electric Cooperative, Inc. 2. 3 x 83.7 MW Cebu Energy Development Corporation Coal-Fired 3. Biliran Electric Cooperative, Inc. Power Plant in Toledo City, Cebu 4. Northern Negros Electric Cooperative, Inc. 3. 2 x 150 MW San Miguel Consolidated Power Corporation Malita Coal- Fired Power Plant in Malita, Davao 5. Bukidnon Second Electric Cooperative, Inc. 4. NPC’s Lubang Diesel Power Plant in Lubang Island 6. Lubang Electric Cooperative, Inc. 5. NPC’s Cabra Diesel Power Plant in Lubang Island 7. Busuanga Island Electric Cooperative, Inc. 6. NPC’s Cullion Diesel Power Plant in Palawan 7. NPC’s Linapacan Diesel Power Plant in Palawan 8. Calamian Island Power Generation’s (CIPG) Coron Power Station in Palawan 9. CIPG’s Busuanga Power Station in Palawan

24 DC 2020-01-0001 and Audit of All Power Generation, Transmission and Distribution 25 DC 2017-12-0006 or “Adopting the Guidelines for the Performance System and Facilities” issued on 28 December 2017

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 17 For the implementation of PAA, the DOE sent letters to For the year 2021, the Development Budget Coordination various generation companies and distribution utilities to Committee (DBCC) through the Department of Budget conduct self-assessment on their compliance to existing and Management (DBM) allocated PhP 8.0 billion for laws, policies, resolutions. the SCC and the SD pursuant to the law. The PSALM earmarked the said amount for Automatic Appropriation Amended the Implementing Rules and Regulations – Special Account in General Fund. of EPIRA Meanwhile, all pending applications for the UC-SCC In March 2017, the DOE issued a Special Order titled, and the UC-SD were dismissed by the ERC in May 2020. “Creating a Technical Working Group to Review the There will be no more collection of UC-SCC and UC-SD Implementing Rules and Regulations (IRR) of EPIRA until the approved amount of PhP208 billion allocation and to Propose Amendments Thereto.”26 The review from Malampaya fund collection is exhausted. And any is envisioned to determine which part of the IRR is succeeding calculations of UCs will be submitted to ERC inconsistent with the provisions of the law, the provisions for information only. Thus, no new UCs will be imposed not part of the law, and part of the IRR that is hard to on electricity consumers starting this year and onwards. implement.

DOE-DPWH Joint Circular No. 2, S.2019 The DOE conducted FGDs with its attached agencies and other electricity industry participants to gather inputs On 30 May 2019, the DOE and the Department of Public and insights on how to improve the implementation of Works and Highways (DPWH) issued Joint Circular No. the EPIRA. The DOE was able to gather sufficient inputs 2 (JC2) creating the Inter-Agency Task Force for the and came up with a draft amendatory IRR which was implementation of those distribution facilities that were subjected to public consultation with the stakeholders and not covered under Joint Circular No. 1 (JC1) or those industry participants from July to September 2018. There distribution facilities that have been obstructing the road were internal discussions, presentations and revisions since the completion of a DPWH road-widening project on the draft undertaken in 2019 to ensure that major concerns, while implementing EPIRA, will be addressed in by 27 July 2017. The JC2 issuance provided immediate the amendments. removal of the obstructing facilities improperly located in the government’s right of way. Entitlement of Issued IRR of “Murang Kuryente” Act compensation shall be given to Electric Cooperatives which can relocate all their obstructing facilities until 31 The President, on 08 August 2019, signed the “Murang December 2019. The JC2 has been effective since 10 June Kuryente” Act,27 which aims to reduce power rates in the 2019, while JC1 is implemented since July 2017. country. Under this law, the government will allocate a share from the Malampaya Fund to be utilized for the As of November 2020, the DPWH was able to implement payment of stranded contract costs (SCC) and stranded relocation of 8,218 electric poles with a total disbursed debts (SD) transferred to and assumed by the PSALM amount of PhP 491.4 million. pursuant to Section 49 of the EPIRA. Both form part of the Universal Charge (UC) that is passed on to consumers. Competitive Selection Process With the law allowing the utilization of Malampaya Fund 28 for the payment of UC-SCC and UC-SD, the benefits In compliance with CSP Policy which took effect in redounds to consumers as it will provide additional relief February 2018, a number of DUs have conducted in the reduction of electricity bills. transparent and competitive procurement of their Power Supply Agreements (PSA). It also provides instances that The DOE and the DOF issued the IRR on 26 February warrant the DOE’s issuance of Certificate of Exemption 2020. from the conduct of CSP.

26 Special Order (SO) 2017-03-0021 5 Utilities of Power Supply Agreement for the Captive Market”. The 27 RA 11371 otherwise known as “An Act Reducing Electricity Rates DOE, in recognition of recommendations by electric power industry By Allocating a Portion of the Net National Government Share from stakeholders, is in the process of amending some provisions and the Malampaya Natural Gas Project for the Payment of the Stranded supplementing the 2018 CSP Policy, particularly the introduction of Contract Costs and Stranded Debts” alternative modes for the competitive and transparent procurement of 28 DC 2018-02-0003 otherwise known as “Adopting and Prescribing PSA. This has been subject to public consultations in December 2020 the Policy for the CSP in the Procurement by the Distribution and is intended for promulgation during the 1st Quarter of 2021.

18 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 People pass by the ruins of demolished structures that were built right under the towers of transmission lines in this industrial suburb north of Manila, 12 March 2019. Photo by Mark Cayabyab/OS Win Gatchalian (Source: wingatchalian.com)

The DOE conducted six (6) Capability Building Workshops Philippines (NGCP), NPC, Transco and ERC and members on CSP for DUs from 15 August 2019 to 11 September 2019 of the TWG, the energy stakeholders and concerned to orient and enhance the capability of the DUs and its government agencies. The four (4) IEC campaigns were Third Party Bids and Awards Committee (TPBAC) on the conducted in November 2020. conduct of CSP. Universal Charge for Missionary Electrification In 2020, the approval of the selection process for the two Subsidy Rationalization (2) captive customer representatives to the TPBAC was included in the DOE’s Citizen’s Charter and processes The rationalization of existing tariffs including the phase- under the EVOSS Online System of the DOE. out of the UC-Missionary Electrification (UCME) subsidy mechanism is one of the salient provisions underscored in Anti-Obstruction of Power Lines Act the Omnibus Guidelines for Off-Grid Areas issued by the DOE in January 2019. To ensure uninterrupted conveyance of electricity from generating plants to end users and protect the integrity, In formulating an evidence-based policy relative to reliability of the country’s transmission, sub-transmission rationalizing the targeted beneficiaries of the Subsidized and distribution systems by clearing it from dangerous Approved Generation Rate (SAGR) and Subsidized obstruction, President Duterte signed the Anti-Obstruction Approved Retail Rate (SARR), the DOE engaged the 29 of Power Lines Act on 08 August 2019. technical assistance of the European Union-Access to Sustainable Energy Programme (EU-ASEP) for the As part of DOE’s responsibility under the Act, a TWG was conduct of a policy research. This is in coordination created on 07 October 2019 composed of all concerned with NPC, NEA, ERC, Association of Isolated Electric government agencies and stakeholders to formulate the Cooperatives, Inc. (AIEC), PSALM, the Department of Act’s IRR. A series of FGDs, technical meetings and public Social Welfare and Development (DSWD), and Philippine consultations were conducted during the last quarter of 2019. Secretary Cusi signed the IRR30 on 06 February 2020. Statistics Authority (PSA) for the required data and strategic inputs. The study is expected to be completed The DOE initiated the conduct of IEC campaign for by December 2020 and will serve as inputs in the the IRR in coordination with National Electrification formulation of the subsidy policy for off-grid areas Administration (NEA), National Grid Corporation of the intended for issuance in the first semester of 2021.

29 Republic Act 11361 31 DC 2019-01-0001 otherwise known as “Prescribing the Omnibus 30 DC 2020-02-0002 otherwise known as “The Implementing Rules Guidelines in Enhancing Off-Grid Power Development” and Regulations of Republic Act No. 11361, Otherwise known as the “Anti-Obstruction of Power Lines Act”

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 19 STRATEGIES TO REDUCE UC-ME SUBSIDIES

EXISTING FORMULA BASED ON FULL COST RECOVERY RATE POLICY

UC-ME Subsidy = (TCGR - SAGR)*Sales + (FCRR - SARR)*Sales + REDCI + NPC Fund Shortfalls NPPs QTPs RE Developers NPC-SPUG

PROPOSED MEASURES FOR RATIONALIZATION

• Interconnection to Main TCGR/FCRR Reduction • Inclusion of REDCI in • Private Sector Participation Grid as full graduation the calculation of bids to reduce NPC-SPUG capital from subsidies • Operational efficiency of DUs during procurement subsidy requirements • Optimal generation planning for the timely entry of process of DUs • Efficiency improvements in • Existing Government low-cost and flexible indigenous and RE technologies NPC- SPUG operations Incentives to support • Hybridization of existing diesel micro-grids • Option for RE • Policy on the use of NPC- priority development • Optimal hybrid micro-grid systems as new standard Developers to waive SPUG Depreciation allowance industries and activities, • Improved system operations REDCI to improve its • Cost recovery for transmission including ecotourism • Grid modernization and smart grid systems competitiveness in and substation operations in (BOI, RE Law, TIEZA, • Improved competitive selection process procurement process off-grid areas ect.) • Improved policy regulation for TCGR/FCCR of DUs • Separate budget for NPC- • Standards for reviewing PSAs/QSSCs SPUG electrification activities • LGU’s contributions • Review of existing PSAs and QSSCs • Alternative formula for REDCI • Other alternative Rationalize SAGR / SARR sources of funds (ER1- NOTE: REDCI = 0 as UC- 94, NWT, etc.) • Improved policy regulation for SAGR/SARR ME is eliminated • Limit eligibility for subsidy to poor households and depressed areas (DSWD) • Time-bound increase in SAGR per area MITIGATING MEASURES

• Postponement or pause • SAGR increases must be supported by TCGR reduction • Joint OCSP and CSP • Private sector in the implementation of • SAGR increases must follow economic improvement to simultaneously investments in case of major and poverty reduction in off-grid areas obtain PSA and RE calamities Service Contracts for RE projects.

RESPONSIBILITIES

DOE - policy oversight for subsidy rationalization PSALM - UC-ME collections and disbursements ERC - regulations to implement the policies DUs in off-grid areas - Competitive Selection Process; Subsidy NEDA-RDCs, DSWD - inputs on the subsidies to poor households Rationalization Plan DOF, NEDA, TIEZA - inputs on partial subsidies to priority economic NPC-SPUG, NPPs, DUs, QTPs - least-cost service, efficiency in operations development activities Consumers in off-grid areas - demand-side management NPC-SPUG - UC-ME petitioner and administration All electricity end-users - payment of the UC-ME as levy

Pursuant to Rule 10 of the Omnibus Guidelines for off- In line with Bayanihan Acts 1 and 2, and applicable grid Areas, the DOE also issued an Advisory to provide provisions in the EPIRA, the DOE issued emergency clarification and direction on the policies and procedures measures to mitigate the impact of COVID-19 to ensure for the provision of UCME subsidy to the generation rates continuous supply of energy within the country, assist the of existing and upcoming NPP until the DOE issues a new power industry players, and provide economic relief to policy on tariff reform and subsidy rationalization, while the electricity consumers. the ERC is expected to provide the complementary rules to implement such policy. From March 2020 to September 2020, the DOE issued advisories that were strictly implemented and monitored Measures and Advisories During Calamities and for compliance of the concerned entities as follows: the COVID-19 Pandemic a) Advisory to all public and private corporations With the global pandemic brought by COVID-19, President in the power sector dated 18 March 2020 titled, 32 Duterte enacted Bayanihan Act One and Bayanihan Act “Solidarity with the Country by Deferring Payments 33 Two , declaring Enhanced Community Quarantine (ECQ), of Obligations and Dues for 30 Days after 14 April General Community Quarantine (GCQ), Modified General 2020 for the Benefit of Consumers.” Community Quarantine (MGCQ) in Luzon, Visayas and Mindanao. It created a deep impact specifically in the b) Advisory/letters to the following for submission of power sector in terms of power accounts obligations of daily and weekly accomplishment reports during the the industry players and payments of electricity bills of ECQ period in compliance with the Memorandum of the electricity consumers. Executive Secretary Salvador Medialdea dated 28

32 RA 11469 otherwise known as “Bayanihan to Heal as One Act” 33 RA 11494 otherwise known as “Bayanihan to Recover as One Act” signed on 25 March 2020 signed on 11 September 2020

20 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 Advisory dated 23 September 2020 provides the Advisory implementation of a minimum of 30-day period and staggered payment without interests, penalties and EXTENSION OF THE ECQ UNTIL other charges to all payments due within the period 30 APRIL 2020 of Community Quarantine (CQ) in the entire electric For electricity consumers: Grace period in the power value chain to include generation companies, payment of electricity consumption and allowed transmission utility, distribution utilities and suppliers. amortization of the same for at least 4 months The implementation of the same shall be subject to the guidelines that will be issued by the ERC. For power companies: 4 months grace period in the payment of all obligations and suspension of DOWNSTREAM OIL interests, fees, penalties and charges to: - payment dues to NPC, PSALM, NGCP The year 2020 has been a challenging time for the industry. - payment to fuel sources The disruption brought about by the Covid-19 pandemic - payment to IPPs and the natural calamities all throughout the year have - grace period in the payment of universal charge made an impact in how the way things are done. Despite to PSALM all the challenges, the DOE managed to find ways and - payment to IEMOP solutions to continue delivering its mandate and functions.

Suspension of the Fit-All Continuity of Service

Encouraged negotiations between contestable The DOE issued Department Orders (DOs) to ensure that customers and Retail Electricity Suppliers relative all units within the organization follows minimum health to obligations falling within the ECQ period standards and comply with the protocols, measures, and strategies in line with Public Service Continuity Plan (PSCP) Requesting consideration of the LGUs in the for COVID-19. Innovative and alternate procedures have collection of relative taxes, fees and dues among been implemented to continuously provide services and power companies / facilities cater activities of its recalibrated work program to adapt to the new normal scheme. With the mechanisms in place, the DOE still processes applications, and monitors March 2020: (1) PSALM to ensure the continuous compliance of the industry players on existing policies, operation of the generation facilities under its among others. management; (2) IEMOP to ensure continuous operation of WESM; (3) PEMC to ensure continues Continuous Management of the DOI governance in the operation of the WESM; and (4) NEA to ensure continuous operation of electric As 07 December 2020, the country’s petroleum inventory cooperatives for stable and available supply of stood at 2,650 million liters, equivalent to 48.8-day of electricity during the ECQ period. supply. Of the total, on-shore inventory refined products and crude oil accounted for 35.5 days, while the remaining c) Advisory dated 16 April 2020 titled, “Advisory Relative 13.3 days represented those supply still in-transit. Such to the Extension of the ECQ until 30 April 2020” inventory level was lower than 2019 level with 51-day addressed to: (1) All Private and Public Corporations supply equivalent. in the Power Sector; (2) All local government units (LGUs); and (3) All Electricity Consumers. The government ensures that the Minimum Inventory d) Advisory dated 07 May 2020 titled, “Advisory on Requirement (MIR) for refiners of a 30-day supply of Providing Grace Period to All Power Sector Bills crude oil and finished product (combined) and bulk oil Falling Due During the Enhanced Community suppliers and LPG importers without refining capacity Quarantine,” which will be until 15 May 2020. The to maintain a 15-day supply of finished products and a advisory has the same provisions as the advisory 7-day supply of LPG, respectively, is complied with. dated 16 April 2020 but as well encouraged negotiations between CCs and Retail Electricity The DOE likewise monitored the imposed of EO 113 Suppliers relative to the CCs obligations falling temporary modifying the rates of import duty on crude oil within the ECQ period. and petroleum products with the imposition of 10.0 percent

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 21 tariff effective 06 May 2020. With this, the DOE mandated The DOE promulgated a DC on the “Revised Guidelines the oil players to submit daily withdrawals of petroleum for the Monitoring of Prices in the Sale of Petroleum products on a per depot basis until the June inventory is Products.”35 In addition to the current contents of the depleted. This is to ensure proper implementation of the notification, added in the amended DC is the Section on oil companies in reflecting the tariff on new importation at Unbundled Price Adjustment, which would provide details their retail outlets’ pump prices. on how oil players arrived at their pump prices. However, the said Circular was challenged in the Regional Trial In May 2020, Petron and Shell refineries notified the DOE Court of Taguig City that resulted in the issuance of a that they will be on a temporary economic/maintenance writ of preliminary injunction on the implementation of plant shutdown due to reduced fuel demand caused the oil price unbundling. The DOE plans to file a motion by the COVID-19 pandemic. However, this is with the for reconsideration with the Court of Appeals, and even assurance that there will be no supply disruption and raise the issue to the Supreme Court if necessary. healthy inventory will be maintained. Supply will be replenished through importation of finished products. Last Tranche of TRAIN Law

The temporary economic/plant shutdown has resulted in On 19 December 2017, President Duterte signed RA 10963 a decrease in volume of crude processed at the refinery or the Tax Reform for Acceleration and Inclusion (TRAIN for the first nine months of 2020 by 34.4 percent, from Law). The Act amends and repeals certain provisions of 6,454 ML of last year’s level to 4,232 ML this year. Based RA No. 8424 or the National Internal Revenue Code of 1997. on the actual reports of the local refiners, the refinery Incorporated in the Law is the increase in excise taxes of production output is also accounted to be 34.5 percent petroleum products. Consequently, the active involvement lower for the period compared to a year ago level, from of the DOE in its implementation to protect consumers 6,263 ML to 4,104 ML. The average refining output for the from retailers implementing the new excise tax from their period was 21.3 ML per day. old stocks. Issued Policy Directives The Law took effect on 01 January 2018, and the excise tax was implemented in three (3) tranches from As the downstream oil industry evolves, so does the need FY 2018 to 2020. In 2020, the full amount of the tax is to review and develop policies and directives that would implemented in all products. cater to the changing times. While critical challenges face our country on a variety of fronts, oil industry remain The DOE efforts to ensure the imposition of new excise actively engaged to ensure uninterrupted supply of tax rates (i.e. oil industry advisory, directive on TRAIN petroleum products at reasonable price. implementation, monitoring and verification of submitted As such, the DOE mandated the PNOC to conduct, within reports) generated savings for consumers estimated a reasonable time, a comprehensive feasibility study at around PhP7.96 billion for liquid petroleum fuels, and for the establishment of a Strategic Petroleum Reserve PhP591.65 million from LPG after the three tranches of (SPR).34 implementation. With the consumer’s interest in mind, the government is vigilant that the new excise tax rates Further, the PNOC will also prepare, within reasonable on petroleum products under the TRAIN Law is fairly and time thereafter, a comprehensive implementation plan responsibly implemented by all the participants. based on the result of the foregoing study. Consumer Safety and Protection

TRAIN Methodology To ensure that petroleum products are compliant with the to Protect the Consumers Philippine National Standards, the DOE conducted on the spot inspection of gasoline and fuel products. Testing of liquid fuel products is done on a regular basis to ensure Verification Actual Advisory DOE directive of monitoring quality. to the oil on TRAIN submitted of the retail industry implementation reports outlets Complaints were filed on-line by netizens at the start of the quarantine period. Among the complaints received were

34 DOE Memorandum Order No. 2019– 11–0001 promulgated on 14 35 DC 2019-05-0008 promulgated on 28 May 2019 November 2019

22 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 related to: LPG prices, dilapidated cylinders, “bote-bote” peddling and the lack of necessary permits to operate.

To address complaints, the DOE requested the assistance of all Metro Manila Mayors to temporarily suspend the operation of LPG refilling plants and Liquid Fuel Retail Outlets in their area of jurisdiction without the necessary permits.

Further, the DOE regularly conducts weekly price monitoring to inform consumers regarding changes in LPG and liquid fuel products prices. This is posted in the DOE website for ease of access to the public. In the typhoon affected areas, the DOE dispatched teams to the The DOE’s Oil Industry Management Bureau and field offices conducts inspections to monitor the compliance of gasoline stations and LPG fields in order to ensure the price freeze implementation establishments with national petroleum standards. Photo taken in in the area. Pangasinan during focused inspections conducted in July 2019.

Pre-TRAIN LAW 1ST TRANCHE - JAN 2018 2018 Total Excise 12% Excise 12% Product Tota l Tota l Ta x VAT Ta x VAT Excise With IMPACT OF Ta x 12% VAT EXCISE TAX ON Peso/liter PRICES OF Gasoline 4.35 0.52 4.87 2.65 0.32 2.97 7.00 7.84 PETROLEUM Avturbo 3.67 0.44 4..11 0.33 0.04 0.37 4.00 4.48 PRODUCTS Kerosene 0.00 0.00 0.00 3.00 0.36 3.36 3.00 3.36 (Per RA 10963) Diesel 0.00 0.00 0.00 2.50 0.30 2.80 2.50 2.80 Fuel Oil 0.00 0.00 0.00 2.50 0.30 2.80 2.50 2.80 LPG (motive fuel) 0.00 0.00 0.00 2.50 0.30 2.80 2.50 2.80 LPG, P/kg 0.00 0.00 0.00 1.00 0.12 1.12 1.00 1.12

2ND TRANCHE - JAN 2019 1ST TRANCHE - JAN 2018 2019 Total 2020 Total Excise 12% Excise 12% Product Tota l Tota l Ta x VAT Excise With Ta x VAT Excise With Ta x 12% VAT Ta x 12% VAT Peso/liter Gasoline 2.00 0.24 2.24 9.00 10.08 1.00 0.12 1.12 10.00 11.20 Avturbo 0.00 0.00 0.00 4.00 4.48 0.00 0.00 0.00 4.00 4.48 Kerosene 1.00 0.12 1.12 4.00 4.48 1.00 0.12 1.12 5.00 5.60 Diesel 2.00 0.24 2.24 4.50 5.04 1.50 0.18 1.68 6.00 6.72 Fuel Oil 2.00 0.24 2.24 4.50 5.04 1.50 0.18 1.68 6.00 6.72 LPG (motive fuel) 2.00 0.24 2.24 4.50 5.04 1.50 0.18 1.68 6.00 6.72 LPG, P/kg 1.00 0..12 1.12 2.00 2.24 1.00 0.12 1.12 3.00 3.36

TRAIN Savings Computation 2018 2019 2020

Product Type Inventory Inventory Inventory Volume Excise Total Savings Volume Excise Tax Total Savings Volume Excise Tax Total Savings (In KL) (In KL) (In KL)

Diesel 537,489 2.50 1,343,723,664.13 852,227 2.00 1,704,454,528.04 969,666 1.50 1,454,499,172.47 Fuel Oil 141,290 2.50 353,224,091.16 189,895 2.00 379,790,460.52 168,500 1.50 252,749,269.14 Gasoline 289,816 2.65 768,013,674.91 522,092 2.00 1,044,183,516.46 600,382 1.00 600,381,562.91 Kerosene 7,398 3.00 22,193,482.78 13,395 1.00 13,394,569.00 12,173 1.00 12,172,871.85 LPG 82,673 2.50 206,681,456.02 111,977 2.00 223,954,977.00 107,344 1.50 161,015,295.12 Jet A1 33,319 0.33 10,995,150.55 83,087 - - 78,211 - - Grand Total 1,091,985 2,704,831,519.55 1,772,674 3,365,778,051.02 1,936,275 2,480,818,171.49 Total Savings P2.70B P3.37B P2.48B TOTAL ESTIMATED SAVINGS FOR THE CONSUMERS PHP 8.55Bn

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 23 MOVING TOWARDS A CLEAN ENERGY FUTURE

With increasing global concern on sustainable development and green environment, the government has DC 2019-10-0013 reasserted its commitment in creating a greener and safer 01 October 2019 environment for the Filipino people, while being mindful of ensuring greater availability of energy supply to fuel the country’s economy. Promulgating the Omnibus Guidelines Governing the Awarding and The DOE continues to survey and develop all potential indigenous energy sources to diversify the energy supply Administration of RE Contracts and mix and increase energy self-sufficiency level for a more the Registration of RE Developers sustainable energy supply, especially during critical times like the COVID-19 pandemic where energy system becomes vulnerable.

continuous implementation of renewable projects. These RENEWABLE ENERGY would help stir up the full potential of private investments Enhanced Opportunities for RE Investments for RE development.

As more consumers are aware of the long-term benefits The Omnibus Guidelines Governing the Awarding and of renewable energy (RE), the DOE puts emphasis Administration of RE Contracts and the Registration of RE to accelerate the development of renewable-based Developers was put in place on 01 October 2019.36 Among resources. Efforts to attract investors remain to be the the provisions of the Omnibus is that RE projects for own- key action agenda of the DOE since the implementation use and/or for non-commercial purposes shall not require of RE law in 2008. Enforcement and fast-tracking of policy RE Contracts, but shall only comply with the registration mechanisms and issuance of new rules and guidelines requirements. were prioritized to stimulate investments and encourage greater placement of more renewables. To fully avail the fiscal and non-fiscal incentives under the Established RE Support Mechanisms RE Act, the DOE issued the Guidelines on the Duty-Free Importation37 on 13 February 2020. The policy guidelines The DOE formulated other support mechanisms and govern the processing and approval of application policies that streamline bureaucratic processes and for Certificate of Endorsement (COE) for the duty-free regulatory procedures to facilitate the timely and importation of machinery, equipment, materials and

36 DC 2019-10-0013 37 DC 2020-02-0005

24 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 spare parts used for RE operations. It also covers the application of COE involving temporary exportation, DC 2020-02-005 sale, transfer, assignment, donation or other modes of 13 February 2020 disposition of originally imported capital equipment/ machinery including spare parts brought into the RE Guidelines on the Duty-Free Importation facilities of the RE Developer/Operator, which availed of duty-free importation. and Monitoring of the Utilization of RE machinery, equipment, materials and Pursued Consumer-centered Policies spare parts and their transfer and other The energy sector has also taken a leap in shifting the disposition. perspective on renewables, from grid-centered to a more consumer-centered approach. Pursuing “prosumer” policies has been one of the innovative adaptations of the DOE to further revitalize the prospects of the A total of 19 RE projects were issued a Certificate of renewable energy landscape. Endorsement to ERC for Fit Eligibility for the 2019-2020 period, which include six hydropower projects with an Feed-In-Tariff (FIT) System aggregate capacity of 58.78 MW and 13 biomass projects with 117.65 MW total capacity. The implementation of the FIT scheme in 2010, which offered a guaranteed fixed rate payment on aper Enhanced Net-Metering Program kilowatt-hour for electricity sales for qualified renewable energy producers have brought about the influx of RE Cognizance of the importance to encourage and technologies in the country. As of November 2020, a total promote electricity consumers’ participation in the Net- of 1.3 gigawatt (GW) capacity has been installed under the Metering Program, the DOE issued a DC on 22 October FIT System since its promulgation in July 2010, composed 2020 prescribing a policy to enhance the existing Net- of 500-MW installation targets for solar, 400 MW wind, 250 Metering Program for Renewable Energy Systems.38 The MW biomass and 146 MW hydro. The two-year extension DC intends to improve the current policy and commercial given by the government after its expiration in 2017 has arrangements, while ensuring the economic and technical completed the installation targets for biomass technology. viability of the distribution utilities (DUs). Now, the net- However, the remaining FIT scheme for 103.9 MW run-of- metering may be implemented in off-grid areas served river hydro has been extended until fully subscribed. by the DUs or electric cooperatives (ECs). In pursuit of

38 DC 2020-10-0022

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 25 FIT INSTALLATION TARGETS AND FIT RATES

Installation ERC Approved With Certificate of Endorsement Installation Target FiT Rates to ERC Target Balance Resource Capacity (PhP/kWh) No. of Projects Capacity (MW) Capacity (MW) (MW)

5.90 5 34.60

Hydropower 250 5.8705*** 1 8.50 103.89

- 9 103.01

200 8.53 3 249.90 Wind 0 200* 7.40** 3 144.00

50 9.68 6 108.90 Solar 0 450* 8.69** 17 417.05

6.63 12 117.35

Biomass 250 6.5969*** 4 14.56 0

- 15 125.13

Ocean 10 Deferred - - -

TOTAL 1,410 75 1,323.00 103.89

* Additional installation targets ** FIT rates for the respective additional installation targets (W-ERCRes14, s2015; S-ERCRes6, s2015) *** Degressed FIT rates (H&B-ERCRes1,2017)

its mandate to educate and protect electricity end-users, development. From 2019 to 2020, a total of 173 RE Service the DOE will develop a Net-Metering Guidebook to set Contracts (RESCs) were awarded and once these projects the rules and procedures, as well as the standards and are commercially developed, could potentially provide protocols for this program. an aggregate generating capacity of 7,690 MW into the energy system. Accelerated RE Position The awarded contracts cover 85 solar service contracts Awarded RE Service Contracts with a total potential generating capacity of 2,740.1 MW, The government’s higher prioritization on the promotion 55 hydropower with 1,523.7 MW, 17 wind with 3,380.1 MW, and adoption of cost-competitive sustainable RE 10 biomass with 45.9 MW, and three (3) geothermal with technologies have induced investments for RE capacities that are not yet determined.

AWARDED RENEWABLE ENERGY SERVICE CONTRACTS (2019-2020*) SOLAR HYDRO WIND BIOMASS GEO

2019 - 76 2019 - 52 2019 - 16 2019 - 6 2019 - 2 2020 - 9 85 2020 - 3 55 2020 - 1 17 2020 - 4 10 2020 - 1 3 TOTAL TOTAL TOTAL TOTAL TOTAL 2,740 MW 1,524 MW 3,380 MW 46 MW TBD POTENTIAL CAPACITY POTENTIAL CAPACITY POTENTIAL CAPACITY POTENTIAL CAPACITY POTENTIAL CAPACITY

*As of September 2020

26 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 Table 7. NEWLY INSTALLED RE POWER PLANTS (2019-2020) INSTALLED START OF COMMERCIAL RE TECHNOLOGY REGION PROVINCE PROJECT NAME CAPACITY OPERATION (MW)

CAR Benguet La Trinidad Rin-of-River HEPP 20.4 July 2019

IV - A Laguna Majayjay Run-of-River HEPP 2.2 May 2019

Hydropower Laguna Calibato Hydroelectric Power Plant 0.3 January 2020

IV-B Oriental Mindoro Inabasan Run-of-River HEPP 10.0 2019

XIII Agusan del Norte ASIGA Run-of-River HEPP 8.0 May 2019

III Tarlac Concepcion 2 Solar Power Plant 70.9 Feb 2020

Solar VIII Southern Leyte Limasawa Solar Power Plant 0.12 2020

XII General Santos ADGI Solar Power Plant 25.0 December 2019

II Isabela CBEC Rice Husk-fired Power Plant 15.0 October 2019

G2REC Napier Grass-fired Biomass III Nueva Ecija 12.0 December 2019 Power Plant Biomass VII Negros Oriental CAB Bagasse-fired Cogeneration Plant 25.0 November 2019

XII South Cotabato 6 MW Biomass Power Plant 6.0 January 2020

Tota l 194.92

Installed New RE Capacities Suspension of Performance Bonds

A total of 12 RE development contracts were completed in The DOE issued an advisory on 23 October 2020 to RE 2019 and 2020 with 194.9 MW aggregated capacity and service contract holders suspending the requirements now integrated into the energy system. These capacities to post Performance Bonds until such time that relevant are being sourced from three solar projects with 96 MW provisions of DC2019-10-0013 and other pertinent DOE combined capacity, four (4) biomass projects with 58 circulars are amended. This is pursuant to Section 2 MW, and five (5) hydropower projects with 41 MW. of the Republic Act (RA) 1103240 adopting a simplified requirements and procedures that will reduce red tape and 3rd Open and Competitive Selection Process expedite business and non-business-related transactions The DOE signed the new policy guidelines on 20 in government. The initiative is also expected to drive October 2020 governing the 3rd Open and Competitive down the cost of project development that redounds to Selection Process (OCSP3) in the awarding of RE Service lowering of power rates. Contracts.39 This is to encourage greater participation of prospective investors in RE development. The new policy Competitive Renewable Energy Zone (CREZ) allows 100 percent foreign ownership of large-scale geothermal exploration, development, and utilization In accordance with the DC 2018-09-0077 in 2018 for projects with an initial investment cost of about USD 50 the establishment and development of Competitive million capitalization through the Financial and Technical Renewable Energy Zones in the Country, the DOE Assistance Agreements (FTAAs). The FTAAs may be entered into a partnership with the United States entered into between foreign contractors and the Philippine Agency for International Development (USAID) and government for the large-scale exploration, development, the U.S. Department of Energy’s National Renewable and utilization of natural resources, and are signed by the Energy Laboratory (NREL) for technical support in the President. The initial investment shall include capitalization development and implementation of the CREZ process, necessary during pre-development stage up to drilling of and the identification of the candidate renewable appropriate number of production wells. zones in country with highest concentrations of high-

39 DC 2020-11-0024 40 Ease of Doing Business and Efficient Government Service Delivery Act of 2018

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 27 Figure 1. 25 CANDIDATE CREZs

quality wind and solar resources. These initiatives aim With the assistance of the EU-ASEP, a series of workshops/ to encourage the transmission upgrades and expansion webinars were conducted in March 2019 and October towards the optimal utilization of the country’s indigenous 2020 on the usage of the Simplified Planning Tool (SPT) renewable resources. Results of the study have identified ver. 3.0. The tool will be used in determining the minimum 25 Candidate CREZs (as shown in Figure 1) across the percentage of renewable share in the mandated country with an estimated gross capacity of 152 GW of participant’s energy portfolio to meet the minimum RE new wind and solar photovoltaics (PV). The zones also requirement in their respective off-grid and missionary include an estimated 365 MW of geothermal, 375 MW of areas. However, with the recalibration of the commercial biomass, and over 650 GW of hydropower capacity. operation of the Renewable Energy Market (REM), the Compliance Year 1 for RPS off-grid is suspended until Renewable Portfolio Standards further notice.

As part of the preparatory works for the implementation Green Energy Auction Policy (GEAP) of the Renewable Portfolio Standards (RPS) for both on-grid41 and off-grid42 areas, the DOE through the To provide option for RPS compliance by the mandated RPS Composite Team conducted 11 FGDs in 2019 on participants, the DOE established the GEAP to facilitate the RPS requirements and compliance level for on-grid the procurement of renewable projects through a mandated participants in Luzon, Visayas and Mindanao. competitive selection process. The Guidelines Governing The FGDs were intended to assist mandated participants the Conduct of GEAP43 was issued on 14 July 2020 that in determining their 2020 RPS requirements as well as sets the framework for which the DOE shall conduct the their compliance level until 2029. competitive auction of supply from eligible RE projects

41 DC 2017-12-0015 signed on 22 December 2017 requiring load- efficient use of the universal charge for missionary electrification serving entities to source an agreed portion of their supply from (UCME) and improve self-sufficiency in power generation through eligible RE facilities. integration of RE in the supply mix in the off-grid and missionary areas. 42 DC 2018-08-0024 signed on 24 August 2018 rationalizing the 43 Department Circular 2020-07-0017

28 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 by the mandated participants under RPS program and as applicable for their long-term power supply requirements. DC 2020-04-0009 It also provides additional market for RE developers with 22 April 2020 the end view of accelerating greater entry of renewables in the power industry with competitive rates. Guidelines Governing the issuance Renewable Energy Market (REM) Rules of Operating Permits to Renewable Energy Suppliers under the Green The DOE issued the REM Rules44 on 04 December 2019, a significant milestone as it completed the policy mechanisms Energy Option Program prescribing under the Renewable Energy Act of 2008.45 The REM the guidelines and procedures in establishes the market for the trading of RE Certificates (RECs) between and among trading participants. Its rules the issuance, administration, and prescribe the required complementary processes for revocation of GEOP Operating permits the orderly implementation of the Renewable Portfolio Standard (RPS) Rules for on-grid and off-grid areas. to RE Suppliers. On 17 December 2019, the Philippine Renewable Energy Market System (PREMS) was launched to serve as the online platform for the trading participants in managing their REC accounts. Registration of trading participants RE suppliers. Such policy prescribes rules and procedures has started in preparation for the operationalization of the in the issuance, administration, and revocation of GEOP PREMS as part of the full implementation of the REM Rules. Operating Permits of RE suppliers. Likewise, under this However, due to the impact of COVID-19 pandemic, the policy, all contracts shall cover a minimum of 100kW, commercial operation of the REM has been moved from regardless of the percentage requirement of the end- June 2020 to June 2021. user. As of 22 October 2020, five (5) RE suppliers were awarded with GEOP Operating Permit.

Development for Renewable Energy Applications Mainstreaming and Market Sustainability (DREAMS)

The five-year DREAMS project, which commenced in 2016 with a USD 5.2 million grant from the Global Environment Facility (GEF) and United Nations Development Programme (UNDP), facilitated the commercialization of the renewable energy market and eased the barriers to increase investment in renewable-based power generation projects.

On 14 August 2020, the USD 1.0 million Support Facility for Renewable Energy (SF4RE) project was launched and received 28 renewable project proposals from LGUs, ECs, new power producers (NPPs), qualified third parties (QTPs), non-profit/community-based organizations/enterprises and academic institutions. These project proposals require a total investment of PhP370 million and expected to provide and improve energy access to 72,000 households Green Energy Option Program in far-flung and off-grid areas using renewables.

On 22 April 2020, the DOE issued the Policy Guidelines A Memorandum of Agreement (MOA) with the Provincial Governing the Issuance of Operating Permits under the Government of Iloilo was also signed on 18 February Green Energy Option Program46 to provide guidance to 2020 to assist the province to formulate its Renewable

44 Through DC 2019-12-0016 46 DC 2020-04-0009 45 Republic Act 9513

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 29 We are pushing for the transition from fossil fuel- based technology utilization to cleaner energy sources to ensure more sustainable growth for the country.

DOE Secretary during the 2nd Global Ministerial Conference on System Integration of Renewables (October 27, 2020)

Development Plan including utilizing and implementing Energy Storage System renewable projects for its unserved and underserved areas. In recognition of the applications and benefits of Energy Storage System (ESS) in the power sector as an emerging Renewable Energy Trust Fund (RETF) technology, the DOE issued a DC on 18 September 2019 that provides a framework for the usage of ESS by the Ensuing the issuance of the Guidelines for the electric power industry stakeholders.48 Operationalization of RETF47 in 2018, a Special Order (SO 2019-01-0003) was effected on 11 January 2020 The ESS technologies will serve multiple functions, among creating a Committee for the administration of the RETF. which are energy generation, peak shaving, ancillary A Technical Working Group and Secretariat were also services and mitigating the intermittent generation established to ensure RETF’s administration, including its output of variable renewable generating plants thereby sourcing, collection, remittance, utilization, and formulation ensuring power quality and system reliability. It will also of necessary mechanisms for the transfer of funds, setting be a key element in the Smart Grid Policy, which the up a special trust account in any existing Government DOE promulgated to guide the electric power industry Financial Institutions (GFIs). stakeholders in modernizing respective electrical facilities.

As of 31 October 2020, only one generation company, so far, issued with a COE for its ESS facilities in Oriental Mindoro. Nonetheless, there are several other generation companies signifying interest in putting up ESS facilities all over the country.

BIOFUELS The government has been resolute in pursuing the development of alternative clean sources of energy by continuously increasing the production capacities of the biofuels producers in the country. In 2019, one (1) biodiesel production facility, Archemicals Corporation, was awarded with Certificate of Accreditation under RA 936749 with a rated capacity of 33 million liters per year (Mlpy), bringing the total biodiesel production capacity to 607.9 Mlpy.

47 DC 2018-10-008 Energy Storage System in the Electric Power Industry” 48 DC 2019-08-0012 otherwise known as “Providing a Framework for 49 Biofuels Act of 2006

30 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 BIOFUELS PRODUCTION

Registered with Notice to 2019 2020* Biofuels Accredited Proceed / For Construction (in Million Liters) (in Million Liters)

# of Annual Capacity # of Annual Capacity TOTAL Production Sales Production Sales Projects (in Million Liters) Projects (in Million Liters)

Biodiesel 3 277.65 12 607.9 241.50 217.52 154.73 131.63

Bioethanol 2 68 12 380.5 346.14 355.55 227.59 230.95

TOTAL 5 345.65 24 988.4 587.64 573.07 382.32 362.58

Actual production from the 12 accredited biodiesel producers in 2019 was recorded at 241.5 million liters, and 154.7 million liters produced in 2020. On the other hand, 346.1 million liters of bioethanol was produced in 2019 Conduct of Formulation and 227.6 million liters in 2020. The reduction in local Nationwide of policies production for biofuels was a result of lower oil demand IEC campaigns due to the COVID-19 pandemic.

Production capacity is expected to increase with the KEY INITIATIVES OF THE AFET PROGRAM granting of Notice to Proceed (NTP) for construction to five biofuel projects as of October 2020. These new Mainstreaming facilities include three biodiesel plants and two bioethanol Promotion of of alternative fuels plants with combined capacity of 345.7 Mlpy. emerging energy & advance technologies & transportation Innovation technologies ALTERNATIVE FUELS Initiatives on Alternative Fuels and Energy Technologies (AFETs) continue to flourish through studies, policies, promotions and demonstrations of alternative fuels, and new and advanced energy technologies. Mainstreaming Developed Energy-related Policies and Research of AFETs is aimed at contributing to the country’s energy Studies security by reducing dependence on imported oil and providing energy consumers with options on advanced The DOE worked on the formulation of policies related energy technologies and more environment-friendly fuel to electric vehicles (EVs) and EV charging stations, options from conventional fuels. emergency response protocol for alternative fuel vehicles (AFVs), development of guidelines on alternative fuel Among the major activities include the conduct of applications, among others. Also, the DOE continued nationwide and awareness campaigns on AFETs, to implement research studies on alternative fuel formulation of necessary policies, promotion of applications and demonstration of advanced energy indigenous emerging energy technologies and innovation, technologies, like the LPG utilization for farm implements, implementation of the locally funded project – “Alternative prototyping of Original Equipment Manufacturer (OEM) Fuels for Transportation and Other Purposes,” and autoLPG jeepney, and the use of EV charging stations integration of AFETs such as LPG (autoLPG), pure electric (EVCS). These scientific undertakings served as bases for vehicles (EVs), hybrid electric vehicles (HEVs), and plug- the development of policies and guidelines towards the in hybrid electric vehicles (PHEVs), SESSY E-boat (Safe, promotion and adoption of AFETs. Efficient and Sustainable Solar-Assisted Plug-in Electric Boat), as well as EV charging infrastructures. The AFET Likewise, the DOE established policy-related partnerships programs have been undertaken in collaboration with on research studies that geared towards the stakeholders in the demonstration of market-ready demonstration and local adoption of AFETs through a technologies. MOA with the following agencies:

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 31 Department of Science and Technology-Philippine A Policy Framework50 for the Development of the Council for Industry, Energy, and Emerging Fuel Economy Rating, Fuel Economy Performance, Technology Research and Development (DOST- and Related Energy Efficiency and Conservation PCIEERD) for the Prototyping of Solar Assisted Policies for the Transport Sector was issued on Plug-in Electric Motor-Powered Boat under the 23 October 2020. This issuance is anchored on joint implementation program on Science and the Energy Efficiency and Conservation Act of Technology Energy Application (STEA) activity. 2019 that provides the framework to empower This project is related to the Philippine development the consumers in choosing fuel efficient transport of technology to identify options of powering vehicles, realize energy savings, reduction of fuel motorized boat (watercraft) which is aligned with consumption, phase out of fuel inefficient transport the goal of DOE to diversify fuel supply resources vehicles, and the reduction of greenhouse gas and contribute to the improvement of air quality emission. It also aims to facilitate and ensure the through the development and commercialization of safe operation and growth of EVs and EVCS. cleaner alternative fuels and energy technologies in the marine transport. Advocated the Passage of Legislative Agenda

Cavite State University (CvSU) for the conduct of The DOE supported and recommended additional various research and development activities on provisions and inputs to the proposed Senate Bill 1382 and emerging technologies: House Bill 4075 that will provide national energy policy and regulatory framework for the use of electric vehicles Prototyping of gym and playground equipment and the establishment of electric charging stations. that can harness energy from human kinetics When enacted, the bill will provide a clear direction and to produce usable electricity; incentives to advance the EV industry and further boost the promotion and adoption of AFETs. Actual road performance data gathering of the DOE-acquired hybrid and EVs; and, Promoted AFETs - Management of Ongoing Programs and Projects Development of TESDA-aligned Electric IEC campaigns. AFETs’ nationwide information/ Vehicle Technician Course Module with a awareness campaign and collaboration with partner National Certification Level II (NC II). agencies and stakeholders are continuing process. In 2019, DOE conducted 22 IECs and 16 in 2020. The Bureau of Fire Protection (BFP) on the Emergency prevailing COVID-19 pandemic posed no hindrance in Response Protocol for AFVs, which will be adopted pursuing the conduct of IEC campaigns, consultations, as part of the Operation Manual by the regional FGDs, and other promotional events. Virtual and social sub-units to respond on the issues and concerns media platforms were made use of to reach out the target related to AFVs, while maintaining its safety and participants. Apart from the conducted IECs, the DOE reliability as alternative mode of transport. also participated in two (2) events in the promotion of AFETs – the Nissan LEAF Test Drive and the 8th Philippine A Tripartite MOA has been crafted among the DOE, EV Virtual Summit that featured EVs and hybrid vehicles. DOST-PCIEERD and University of the Philippines Electrical and Electronics Engineering Institute Liquefied Petroleum Gas (AutoLPG) as Fuel for (UP-EEEI) on the Determination of Optimal Vehicles. The DOE continued to work on gaining public Placement of EVCS in a Local Public Transport acceptance and local mainstreaming of autoLPG as System. The MOA shall establish a framework for alternative fuel source through intensive promotion, public research collaboration for the review, evaluation, information drive, policy development to harmonize inter- monitoring and implementation of programs agency issued guidelines, and research and development under the STEA that aims to identify appropriate to ensure efficiency and public safety. Also, regular emerging technologies for EVs that are aligned to technical working group meetings were held to come up the needs of the industry and the EV roadmap. with recommendations for the drafting of policies and

50 DC 2020-10-0023

32 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 The promotion of EVs will go a long way in helping reduce the country’s reliance on petroleum as the primary source for transportation.

Sec. Alfonso G. Cusi During the 8th Philippine Electric Vehicle Virtual Summit (September 2020)

www.aquaphysio.com

guidelines necessary to support the mainstreaming and With the outbreak of the COVID-19 pandemic, the e-trikes local adoption of the autoLPG at the regional level. are being utilized by the LGUs as service vehicles for emergency response, delivery of goods and emergency Japan Non-Project Grant Aid for the Introduction of supplies, transport of frontliners, manning of checkpoints Next Generation Vehicle Package through DOD and and boundaries, and other social services. MOA. With the relatively new technology of different types of EVs, the DOE still provided training on basic operation, The EV industry gained the support of 14 investors maintenance and electric charging to new drivers of engaged in the business of manufacturing, assembly NGA beneficiaries. The drivers’ training also served in and importation with corresponding total investment increasing the pool of drivers that are knowledgeable of PhP562 million (USD 11.3 million).51 The EV industry is on the proper maintenance and operation of the EVs. seen to progress significantly given the growing public As part of the monitoring activities under the MOA, the acceptance and able-assistance from the government performance data of the EVs was gathered, as well as and stakeholders. checked the physical status.

Monitored the Market Transformation through the NUCLEAR POWER PROGRAM Introduction of Energy-Efficient Vehicles (E-Trike) In an effort to further diversify the country’s energy Project sources and carve out the future ideal energy mix through an open technology approach, the DOE created The DOE signed four (4) MOA and 36 Deeds of Donation the Nuclear Energy Program Implementing Organization (DOD) with the LGUs and national government agencies (NEPIO) in October 2016 to study and assess the (NGAs) on the deployment of 3,000 units of electric feasibility of nuclear power as a long-term energy option. tricycles (e-trikes). The e-trikes were deployed in NCR The DOE-NEPIO adopts the Milestone Approach in the (1,816 units), Regions I (20 units), II (120 units), III (162 units), Development of a National Infrastructure for Nuclear IV-A (370 units), IV-B (142 units), V (120 units), VI (50 units), Power of the International Atomic Energy Agency (IAEA), and ARMM (200 units) under the Market Transformation consisting of 19 infrastructure issues that need to be through the Introduction of Energy Efficient Vehicles addressed. The Nuclear Power Program (NPP) Roadmap Project. Based on the deployment plans, the e-trike was likewise established covering three (3) phases as units are being used primarily for public transportation in follows: major cities and tourism sites to increase visibility of the units and promote public awareness on the advantages In Phase 1, the DOE-NEPIO conducts studies of this technology. The DOE E-Trike Team continues to (energy planning and feasibility studies) taking be in close coordination with the LGU recipients in the into account the considerations before launching monitoring of status of their e-trike operations. an NPP, including the 19 infrastructure issues;

51 USD = PhP 49.55

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 33 L-R: Assistant Secretary Gerardo D. Erguiza Jr. (DOE-NEPIO Vice Chairperson), Undersecretary Donato D. Marcos (DOE-NEPIO Chair), Secretary Alfonso G. Cusi, IAEA Deputy Director-General Mikhail Chudakov, Philippine Ambassador to Austria Maria Cleofe R. Natividad, Philippine Nuclear Research Institute Director Dr. Carlos P. Arcilla and IAEA Nuclear Infrastructure Development Section Head Milko Kovachev.

The Phase 2 involves the preparations for the assessment of the country in terms of its knowledgeable knowledgeable commitments for the NPP after commitments before a decision to embark on NPP, and a policy decision has been taken, such as the if the country is ready to move to Phase 2. The SER was creation of a management team and independent a prerequisite for the conduct of the “Integrated Nuclear regulatory body, and development of policies, Infrastructure Review (INIR) Mission” by the IAEA. guidelines and procedures for the procurement and contracting; and, The government hosted INIR Mission for Phase 1 last December 2018. The Official Report of the INIR Mission The Phase 3 includes the establishment of for Phase 1 was handed by the IAEA to the government a Technical Support Organization (TSO) and through Secretary Cusi in a ceremony held last October Research and Development Program, and that the 2019. Aside from activities with the IAEA, the DOE carried independent regulatory body will start implementing out several activities to address the recommendations and guidelines, rules and regulations governing nuclear suggestions of the INIR Mission as part of the work plans power projects, among others. and programs.

th ACTION AGENDA FOR PRESIDENT The 10 Nuclear Energy Cooperation Sub-Sector Network Annual Meeting

Declare that the Philippines is now open to nuclear power and ready to embark on a nuclear power The country saw progress in its initiative for the program development of an NPP through new opportunities. The Philippines Chaired the 10th ASEAN Nuclear Energy Cooperation Sub-Sector Network (NEC-SSN) Annual Certify as urgent the approval of Comprehensive Nuclear Law or any equivalent law to establish a Meeting held virtually last 23 June 2020. The meeting separate and independent nuclear regulatory authority discussed the progress and plans of the NEC-SSN under the ASEAN Plan of Action for Energy Cooperation

Issue an Executive Order to expand the composition (APAEC) Phase I: 2016-2020. Likewise, the Member States of the NEPIO to include other relevant government agreed and adopted the key strategies, outcome-based agencies, academe and representatives from the private sector strategies, action plans and annual priorities including the engagement of dialogue partners and international organizations for the APAEC Phase II: 2021-2025. The DOE-NEPIO made notable accomplishments through its various activities conducted with other relevant Executive Order 116 agencies. The recommendation for a “National Position to Embark on a Nuclear Power Program” was submitted The President signed EO 116 on 24 July 2020 “Directing a to the Office of the President in April 2018. Study for the Adoption of a National Position on Nuclear Energy Program, constituting a Nuclear Energy Program After completing the studies under Phase 1, a Self- Inter-Agency Committee (NEP-IAC), and for Other Evaluation Report (SER) was completed and submitted Purposes.” Said EO established the NEP-IAC which is to IAEA in October 2018, which outlined the readiness tasked to conduct a study for the adoption of a National

34 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 Position on NPP in accordance with pertinent IAEA Hydrogen for Power (S1), Hydrogen for Transport (S2) and guidelines, relevant laws, rules and regulations. the Combined Power and Transport (S1 + S2 or S3). The following are the assumptions considered in the study: The NEP-IAC is Chaired and Co-Chaired by the DOE and DOST, respectively, with member government 1. As a back-up power for the grid and an alternative agencies composed of the Department of Environment power option for off-grid areas, especially with and Natural Resources (DENR), Department of Finance variable renewable sources (solar and wind) for (DOF), Department of Foreign Affairs (DFA), National power plants; Economic and Development Authority (NEDA), Philippine Nuclear Research Institute (PNRI), Philippine Institute 2. About 10 percent penetration rate for hydrogen to of Volcanology and Seismology (PHIVOLCS), NPC and replace vehicles using gasoline and diesel; and, TransCo. Other government agencies, such as the 3. Power and transport use based on the optimal Department of Justice (DOJ), Department of National hydrogen production. Defense (DND), Department of Trade and Industry (DTI), Commission on Higher Education (CHED) and Technical The Clean Energy Scenario (CES) of the Philippine Energy Education and Skills Development Authority (TESDA) Plan (PEP) 2018-2040 serves as the starting point of provide vital inputs and assistance. It is composed of six modeling hydrogen in the energy sector. The result of (6) subcommittees (SCs): the optimal mix is integrated in the whole energy system to determine the impact of hydrogen in the energy mix.

Management Nuclear Safety Legal and Regulatory The draft study initially identified three (3) options for the Policies Nuclear Security Safeguards production of the hydrogen – the Grey Hydrogen with coal 1 Financing 2 3 Radiation as its fuel source in the production; the Blue Hydrogen Procurement Protection using natural gas; and the Green Hydrogen using renewables, such as, solar, wind, biomass, geothermal, and even nuclear. The study will determine the optimal option Human Siting Nuclear Fuel Resource Cycle Environment for the production of hydrogen both for the power and Stakeholders Radioactive Emergency Plan transport models. The study is expected to be completed 4 Involvement 5 6Waste by 1st quarter of 2021.

The NEP-IAC Strategic Planning Workshop was conducted SMART GRID POLICY on 08-10 December 2020 in order to finalize the report and recommendation, including a proposed EO, for the On 06 February 2020, Secretary Cusi approved and adoption of a national position on NPP to be submitted signed the Smart Grid Policy, which supports the to the Office of the President. The Workshop convened all enhancement and modernization of the entire power the Sub-Committees to present their draft reports to be system. The DOE deemed it necessary to have a consolidated into a NEP-IAC’s main report to the President smarter grid to meet the challenges brought about which was submitted last 18 December 2021. the transformation of the energy and power sector through deregulation, decentralization, decarbonization, digitalization, and democratization. This policy aims HYDROGEN to improve safety, reliability, efficiency, flexibility, The DOE issued a Special Order on 25 November 2020 sustainability, and resiliency of the power system, while “Directing the Creation of a Hydrogen and Fusion Energy promoting consumer empowerment. Committee (HFEC) to Make a Study on Hydrogen and Fusion Energy including Infrastructure Development The Smart Grid Overall Framework includes Smart Methods and Strategies, Prepare a Framework on their Power Generation, Transmission Modernization, Smart Inclusion in the Energy Mix and for Other Purposes.” Distribution Utility Roadmap, Information Sharing and Pursuant to said SO, a study has been initiated to determine Education Campaigns, Communication Infrastructure the impact hydrogen to the country’s energy mix. The Support, Interoperability, and Cybersecurity. In support study depicts the flow of the whole energy system with to the policy’s objectives, the DOE conducted nine (9) the inclusion of hydrogen as an option for power and legs of IEC campaigns with all DUs in Luzon, Visayas and transport fuel supply with three (3) scenarios, namely: Mindanao.

52 SO 2020-11-0041 Smart Grid Policy Framework for the Philippine Electric Power Industry 53 DC 2020-002-0003 otherwise known as “Providing a National and Roadmap for Distribution Utilities”

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 35 ENERGY EFFICIENCY FOR A GREEN ECONOMIC RECOVERY

In 2020, economies all over the world have felt the to help the Philippine economy to once again stimulate devastating impact of climate change and the health consumer confidence, support small and medium-sized pandemic - be it from the loss of life, high unemployment businesses, put forward infrastructure development which rate, closure of businesses, among others. Countries, will all help pump-prime the hard-hit local economy. whether developed or underdeveloped, have not been Moreover, the People’s Proposed Budget for 2021 spared by this new reality. In response, governments amounting to PhP4.5 trillion has allocated PhP3.6 billion to lost no time in packaging rapid economic response plans develop power infrastructure systems that would support to address job losses and create new opportunities for economic rebound. For the Philippine energy sector, recovery. the strategy of addressing energy demand through technological innovations play a big role in supporting The Philippines, although a very low emitter of greenhouse these stimulus packages. This is where technological gases, has not been spared. Stimulus packages – advances on energy efficiency can help the country “build Bayanihan 1 and 2 – were immediately placed on board back better” and secure the energy system.

Energy Saving 2,393,753.17 kWh 530,000 liters ELECTRICITY FUEL

Institutionalized the Government Energy THE ENERGY EFFICIENCY AND Management Program (GEMP) CONSERVATION ACT OF 2019 Secretary Cusi signed DO 2020-01-0001 on 09 January After three (3) decades of waiting for a mandatory 2020 organizing the Inter-Agency Energy Efficiency and policy on energy efficiency and conservation (EEC), 2019 Conservation Committee, which is tasked to evaluate proved to be a milestone year with the passage of RA and approve the Government Energy Efficiency 54 11285 or the EEC Act of 2019 and the approval of its IRR Projects (GEEP) and provide strategic directions in the on 24 May 2019. Both policies are set to make EEC policies implementation of GEMP. responsive to the country’s goal of making EEC a “way of life” for Filipinos. Following are the accomplishments in The GEMP requires all concerned government agencies to terms of adhering to the EEC Act and its IRR: realize at least 10 percent energy cost savings from both

54 DC 2019-11-0014

36 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 petroleum and electricity consumption (based on their energy use in government. As a result, eight (8) energy 2015 consumption level). The role of GEMP was highlighted audits were completed during the pre-pandemic phase with the implementation of “Bayanihan to Heal as One and 38 virtual audits during the pandemic period. Act “and the National Budget Circular No. 580 (Adoption of Economy Measures in the Governments due to the Mandated the Philippine Energy Labeling Program Pandemic). As a result of the DOE’s call for adherence (PELP) and the Minimum Energy Performance for to GEMP, 75 government entities submitted reports on Products (MEPP) their EE&C projects with an estimated aggregate energy savings of 2,393,753.17 kWh of electricity and about 530 The country will now have a mandatory energy labeling thousand liters of fuel. program for energy consuming products (ECPs) through the complementary policies on the PELP and MEPP which Nationwide IEC campaign activities were intensified to were both signed on 15 June 2020. inform the government sector on the requirements of GEMP and the responsible use of energy in the government’s The Guidelines of the PELP for Compliance of Importers, own backyard. Manufacturers, Distributors and Dealers of Electrical Appliances and other ECPs55 covers appliances, such as Energy audits are major activities under GEMP, through air conditioning units, refrigerating appliances, television which EE&C measures are recommended to improve sets and lighting products (compact fluorescent lamps,

DOE’s timely approval of the IRR is a welcome milestone that ensures that the EE&C Act, after 29 years of a voluntary energy efficiency market, is implemented responsively and without delay.

ALEXANDER ABLAZA President, Philippine Energy Efficiency Alliance

55 DC 2020-06-0015

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 37 linear fluorescent lamps, single-capped fluorescent Service Companies (ESCOs).”57 This policy requires the lamps, lamp ballast and light emitting-diode (LED) lamp). DOE registration of all ESCOs, whether as Registered A comprehensive and unified database is being developed ESCO or Certified ESCO. To date, there are 41 registered based on the information from the PELP Online Portal. ESCOs (composed of 20 active ESCOs, 20 companies for Said database will be used for company application, renewal and one (1) company on-process). product registration, request for energy labels, as well as for evaluation, analysis and dissemination of data. Mandated the Submission of EEC Reports by All Designated Establishments (DEs) On the other hand, the policy on “Prescribing the MEPP covered by the PELP for Compliance of Importers, Designated establishments will now be required to Manufacturers, Distributors, Dealers and Retailers of submit their respective energy consumption reports.58 56 ECPs” will ensure the efficiency of products covered Specifically, reports for submission to the DOE are the under PELP by setting the required energy performance Annual Energy Efficiency and Conservation Reports and prevent the entry of inefficient products in the (AEECR) and the Annual Energy Utilization Report Philippine market. Products covered under MEPP are (AEUR). This policy also requires DEs to appoint their the window- and split-type room air conditioners (RACs), respective Energy Conservation Officer (ECO) or an refrigeration units (single door, two-door manual defrost Energy Manager (EM) based on energy consumption and frost-free units) and lighting products. Adherence to this policy will promote a competitive environment for the threshold (Type 1 and Type 2 establishments). industry as locally available products will now be at par with international standards. As of December 2020, there are 203 commercial establishments and 96 industrial/manufacturing With the implementation of these policies, only products establishments which have submitted their AEUR through that comply with MEPP shall be issued with an Energy DOE’s on-line google platform. This also included the Label (in compliance with PELP). registration of their respective ECOs or EMs.

Strengthened the Energy Service Company (ESCO) Implemented the Energy Efficiency Recognition Accreditation Process Awards

To further accelerate the adoption of EEC measures, the Energy Efficient Green Building Award (EEGBA) existing ESCO accreditation process will be reinforced through the policy prescribing the “Guidelines in the The EEGBA is a recognition award of the DOE, which Administration, Classification and Certification of Energy acknowledges the initiatives of the government agencies

2020 ENERGY EFFICIENCY AWARDEES ENERGY EFFICIENT GREEN BUILDINGS (SMALL/MEDIUM BUILDING CATEGORY) Hyundai Cebu South Dealership Botanika Nature Residences by Hyundai Asia Residences, Inc. by Filinvest Alabang, Inc.

ENERGY EFFICIENT GREEN BUILDING (LARGE BUILDING CATEGORY) Arya Residences Estancia one/NEO two/NEO three/NEO by Arthaland Corp. by Ortigas Land Corp. by N-One BGC by N-Square BGC by N-Cube BGC Properties, Inc. Properties, Inc. Properties, Inc..

five/NEO six/NEO seven/NEO Arthaland Century by N-Plaza BGC by N-Lima BGC by N-Park BGC Pacific Tower Properties, Inc. Properties, Inc. Properties, Inc. by Arthaland Corp.

Hyundai Logistics Center National Museum of National History by N-Square BGC Properties, Inc. by the Office of the President

56 DC 2020-06-0016 58 Mandated under Memorandum Circular 2020-05-0001 (Directing 57 DC 2020-09-0018 all Designated Establishments under Commercial, Industrial and Transport Sectors to submit Energy Consumption Reports).

38 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 and commercial business establishments to promote and GEMP Awards 2020 implement energy efficiency measures in compliance with the Philippine Green Building Code and the DOE’s For the government sector, the GEMP Awards 2020 Guidelines on the Energy Conserving Design of Buildings. recognized the commendable efforts of government agencies in complying with the GEMP provisions. The Based on said results, the DOE will endorse the following table below shows the GEMP Awardees for 2020 and their establishments as the country’s official nomination entries respective energy savings and EEC measures: to the ASEAN Energy Awards on Green Building:

Hyundai Cebu South Dealership; Botanika Nature Residences; Arthaland Century Pacific Tower; and, Seven NEO and Hyundai Logistic Center.

ENERGY SAVINGS PESO SAVING AWARDEES EEC MEASURES (in KWh) (in PhP MIillion)

• Adopted a GEMP Policy • Replaced 40W linear fluorescent lamps (LFL) with 18W LED National Power linear lamps Corporation 1,815,916 17.61 • Use of 8W LED in lobbies and hallways (Head Office) • Use of foldable blinds for daytime use • Use of inverter-type Air Handling Units (AHUs) • Aircon thermostat at 24° Centigrade

• Adopted a GEMP Policy • Use of solar power (27 kW peak installed capacity) • Replaced 40W linear fluorescent lamps with 18W LED linear National Electrification lamps 808,804 7.71 Administration • Use of 8W LED in lobbies and hallways • Use of foldable blinds for daytime use • Use of inverter-type AHUs • Aircon thermostat at 24° Centigrade

• Adopted a GEMP Policy • Use of natural lighting and ventilation Development Academy • Replaced LFL and CFLs with linear LED lamps and LED bulbs 711,301 7.83 of the Phils. • Use of foldable blinds for daytime use • Replaced the centralized air-cooled chiller system with unitary A/Cs to improve control of use

• Implementation and monitoring of EEC measures • Use of inverter-type A/C units • Use of air cooler units Center for International • Manual cleaning of official vehicles instead of motorized Trade Expositions 284,868 2.77 pressure washer Missions (CITEM) • Use of curtain blinds to take advantage of natural light • Procurement of 15% units of laptop computers to replace desktop computer units

• Use of inverter-type Aircon units • Installed digital thermometer and hygro-thermometer to monitor A/C temperature not lower than 25° centigrade National Transmission 445,920 2.92 (except for computer server rooms) Corporation • A/C units switched to fan mode during lunch breaks • Use of 16W LED tube lights • Use of motion sensor devices in restrooms

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 39 ENSURING ENERGY ACCESS FOR ALL

As the country approaches the midpoint of President the country. To achieve this, various programs, aside from Duterte’s Administration, the DOE is determined to conventional extension of distribution line facilities, are achieve its priority goal of reaching total electrification being implemented, such as the DOE-Solar Photovoltaic of the country by 2022. This means that electricity will be (PV) Mainstreaming and QTP Programs. available to all unserved and underserved households in

Target HHs Energized Level 22.98 million 24.12 million 94.5% (2015 Census) (December 2020)

2016 – 2019 Electrification Status households were provided with electricity service as the served households went up to 24,126,338 (December Electrification at the household level in country continually 2020) from only 23,229,866 in December 2019. To date, increased for the period 2016 – 2018 (from 90.7 percent to the remaining unserved households totaling 1,263,495 96.1 percent). In 2019, a noticeable change was seen on the are mostly situated in far-flung remote areas of the household electrification level, as the DOE only reported country. On a grid level, household electrification is 93.0 percent. The drop in electrification level is a result already at 98.4 percent in Luzon, 95.6 percent in Visayas of a new approach in reporting household electrification. and 83.6 percent in Mindanao. The rationale for the change in approach as conveyed by the Task Force E-Power Mo (TFEM) is to have a better In compliance with the responsibilities of the TFEM, the targeting of unserved and underserved areas within the DUs were required to submit their respective updated total franchise areas of the distribution utilities (DUs). It also electrification master plans from 16 – 23 October 2019. represented the actual status of unenergized households The submission of master plans received were from 118 down to the province/region and DU level. The previous ECs (out of 121) and 10 PIOUs (out of 19). A total of 31,834 method of reporting was not able to capture and target areas equivalent to 1,193,587 households were targeted for the unserved households within the franchise areas. The electrification. The total project cost based on submissions reported electrification level was largely compensated is around PhP 26.67 billion wherein PhP 22.18 billion requires and driven by the high number of connections in cities thus subsidy. Although there are fund sources that can be neglecting the actual unserved households in the areas. tapped for electrification (e.g., loan, capital expenditures 2016 – 2019 Status of Electrification for application to the ERC, ER 1-94 Electrification Fund, grant, and partnerships), program implementers are still The country’s household electrification level now dependent on subsidy, which are primarily the programs stands at 94.5 percent (as of 30 December 2020) from of the DOE, National Electrification Administration (NEA) 93.0 percent in December 2019. An additional 896,472 and the National Power Corporation (NPC).

40 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 Although the aim of the master plan submission is for to cooperate with DUs in the conduct of inventory of complete visibility of electrification projects for the unserved and underserved areas. A request was also remaining unserved households, there are still that remain made to the DILG for possible exemption of qualified untargeted from the DU submissions, about 800,000 households from paying fees related or required to avail households. Around PhP 20 billion is needed to connect the of electricity service connection. Discussions with the NEA remaining households if the average rate of electrification and NPC were also conducted to harmonize processes per household per region is used. This poses as one of and interagency responsibilities related to electrification. the main challenges in the Government’s pursuit for total electrification. The National Task Force to End Local Communist Armed Conflict (NTF-ELCAC) established through EO 70 identified To address some of the barriers in program implementation, the areas that are to be provided with electricity service. the TFEM met with other government agencies to resolve These areas were harmonized with the master plan some of the concerns. A MOA with the Department of submissions of DUs with PhP 4.6 billion funding requirement the Interior and Local Government (DILG) was entered to energize 1,579 identified areas. Continued coordination on 22 March 2019, which created an inter-agency support will be done with NTF-ELCAC to fast track and support group. Through the MOA, the DILG may direct all LGUs electrification in areas with armed conflicts.

Funding Source Breakdown (Billion Pesos)

NEA 68.7%

NEA Loan 0.6%

No Funding Source 8.3% 2.223 Others 0.8%

1.056 CapEx 4.0% 18.337

1.641 DOE 6.2%

2.184

ER 1-94 8.2%

Grants 0.9% N/A 1.5%

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 41 97.00 96.12

96.00

95.00 94.50 94.00 92.96 93.00

92.00 91.09 90.65 91.00 % ELECTRIFIED 90.00

89.00

88.00

87.00 2016 2017 2018 2019 2020

Parameters for the NEA’s Subsidy Program

STRATEGY In order to improve the selection of appropriate 01

beneficiaries for subsidy under the NEA’s Sitio STRATEGY

Electrification Program (SEP) and the Barangay Line 07 NIHE SCHEME ENHANCE Enhancement Program (BLEP), the following are the NIHE SCHEME STRATEGY parameters for the selection of DU beneficiaries and the 02 SITIO mechanics for selection process under the NEDA SEP: ELECTRIFICATION MINI-GRID/NPC- PROGRAM SCHEME a) level of energization; b) poverty incidence; c) peace SPUG SCHEME 100%HH and order; d) liquidation; and e) submitted EC’s Total STRATEGY Electrification Electrification Master Plan. 06 2022

STRATEGY The NEA will be responsible and accountable for the BRGY LINE 03 MINI-GRID/QTP ENHANCEMENT completeness of the application of the selection process PROGRAM SCHEME PV SCHEME and the accuracy of the data and information used for MAINSTREAMING SCHEME each parameter. STRATEGY

05 STRATEGY 04 ELECTRIFICATION PROGRAMS National Intensification of Household Electrification (NIHE)

Under the NIHE Program 2015-2018, there are still Table 8. NIHE 2015-2018 51 projects undergoing installation to complete the Total Approved No. of No. of Funding energization of the targeted 177,912 households (Table Project Cost Approved Energized Year 8). Installation activities were halted because of the (in PhP Million) Beneficiaries Household restrictions imposed under community quarantine. To 2015 114.42 30,512 25,563 ensure project completion and that beneficiaries are 2016 437.19 116,592 79,152 reached, the DOE drafted for approval an Advisory 2017 432.06 115,216 38,145 to provide guidance on concerned DUs implementing 2018 306.64 81,770 23,533 NIHE regarding their concerns on the fund releases and inspection upon completion. TOTAL 1,290.31 344,090 166,393

42 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 Our goal is to provide electricity throughout the entire archipelago by 2022. These projects will bring more progress in Mindanao as thousands of Filipino families, particularly those living in far- flung areas of the region, will have access to power.

Sec. Alfonso G. Cusi Department of Energy

Energy Regulations (ER) 1-94 DOE to 309 host LGUs that have submitted their Letter of Intent (LOI) to utilize the available ER 1-94 Fund for As the country faced the COVID-19 pandemic, the DOE COVID-19 responses. The available EF within the custody issued a policy on “Rationalizing the Utilization of ER 1-94 of the generating companies was likewise allocated to the Funds by LGUs in Response to COVID-19 Public Health host LGUs for the implementation of projects combating Emergency.” Its objective is to provide additional fund COVID-19. sources for host LGUs to respond to COVID-19. The DC stipulates that all ER 1-94 funds (EF, DLF & RWMHEEF)59 Sitio Electrification Program that are still with the DOE and the generating companies (last billing quarter of 2019) will be remitted to the host The SEP, including the off-grid solar project for 5,000 LGUs for the implementation of COVID-19 related projects. households, is continuing to experience delays because of the restrictions imposed. The NEA revised the number of With the issuance, all the allocated EF under ER 1-94 sitios to be included in the SEP for 2020 from the original that is due to the DUs is suspended until the Status of target of 964 to 635 sitios. During the first half of the year Public Health Emergency is lifted. To date, the DOE has (June 2020), the NEA through the ECs completed the processed and transferred a total of PhP 2.06 billion of energization of 181 sitios (86 in Luzon, 21 in Visayas, and 74 the PhP 3.4 billion available EF within the custody of the in Mindanao) as seen on Table 9.

Table 9. NEA’s SEP, June 2020

Targets Yearly Cumulative Total Remaining Balance Year Approved per GAA (submitted to DBM) Accomplishments Accomplishment (Unenergized Sitios)

Unenergized Sitios based on the Total Electrification Master Plan 17,100* 2017 6,321 2,410 1,178 1,178 16,081 2018 5,083 1,817 1,984 3,162 14,097 2019 3,626 962 1,085 4,247 13,012 2020 2,000 932** 181*** 4,428 12,672 2021 5,000 2022 10,836 TOTAL 7,206 4,428

Notes: * Excludes sitios determined for off-grid electrification ** NEA is awaiting for the release of funds *** Spill-over of FY 2019 SEP Projects

59 EF refers to Electrification Fund; DLF refers for Development and Livelihood Fund; and RWMHEEF refers to Reforestation, Watershed Management, Health and Environmental Enhancement Fund.

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 43 Barangay Line Enhancement Program Under the Call for Proposals component, ASEP awarded five (5) out of seven (7) entities with grant proceeds to There was no budget allocation for BLEP Projects for 2018- support increasing energy access in remote and off- 2019 thus NEA had no targets for 2019. However, there grid areas (Table 10). These grantees shall explore were 72 barangays that needed enhancements as of end rural development models that will integrate energy December 2019. The NEA was able to complete three (3) with livelihood in rural areas and tapping community BLEP projects in June 2019 amounting to PhP 4.27 million. capacities to ensure the operational sustainability of the project. DOE – Solar PV Mainstreaming In 2019, ASEP also implemented the Productive Use of The implementation of the Solar Photovoltaic RE (PURE) projects through the support of Team Energy Mainstreaming (PVM) Program is one of the DOE’s Foundation. strategies to accelerate the government’s target of 100 percent household electrification. It adopts the Fee- Its objective is to showcase the coupling of electrification for-Service Business Model in which the ECs install solar projects with productive uses to increase beneficiaries’ home systems (SHS) in unenergized households within its income to help sustain energy services provided to local franchise areas that are unviable for grid extension and communities. sells electricity using a prepaid card. The ECs maintain ownership of the hardware and are responsible for The ASEP’s PVM component has an ongoing procurement installation, maintenance, repair, and replacement of the for Bidding Window 2, which covers the installation of system components. On the other hand, the homeowner 30,500 SHS to individual households within the franchise will be responsible for the household wiring, lights and areas of six (6) Electric Cooperatives in Mindanao – other 12 Volt Direct Current (DC) loads/appliances. SUKELCO, DASURECO, COTELCO, BUSECO, FIBECO and Six (6) out of the seven (7) ECs, which implemented SOCOTECO II. The procurement was carried out by the the program, have completed the energization of NPC and concluded in October 2020, while installation 9,655 households of the targeted 11,113. The remaining will commence in the first quarter of 2021. households are expected to be energized by first quarter Qualified Third Party (QTP) of 2021.

Access to Sustainable Energy Programme As support to the total electrification program and for an environment that is more conducive to private sector The EU-ASEP is a technical assistance to aid the participation particularly in remote and unviable areas, government achieves its 100 percent household the DOE issued the Revised QTP Guidelines,60 which took electrification targets through the use of renewable effect on 07 January 2020. The policy streamlined QTP energy. participation procedures, recognized the greater role of

Table 10. ASEP Projects Project Title Proponent Project Site Target HHs

Strengthening Off-Grid Lighting with South Cotabato and Sultan Mahintana Foundation 5,500 Appropriate RE Solutions (SOLARES) Kudarat

Improving the Lives of People in Off-Grid Yamog Renewable Energy Davao del Norte, Davao Oriental, Communities in Mindanao through the Provision 5,000 Development Group Davao del Sur of Sustainable Energy

RE Technologies to Increase Value-Added of UNIDO with MinDA Province of Tawi-Tawi 5,000 Seaweeds in Tawi-Tawi (RETS)

Solar BnB Microhotel and Island Livelihood Kabang Kalikasan ng PIlipinas Siargao and Dinagat Island, Energizer Platform (SMILE) Foundation Surigao del Norte

RE Access for Off-Grid communities and People in Need Foundation Northern Samar 2,750 Household (REACH)

60 DC 2019-11-0015 issued on 22 November 2019

44 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 DUs in the selection of QTPs in their areas proposed for fund projects specifically for the depressed areas in private sector investment and harmonized with RA 9513 Mindanao. This grant is in collaboration with the DOE and (or the RE Act), particularly the RPS standards in off-grid Mindanao Development Authority (MinDA). The grant areas. As of December 2019, the QTP Projects benefited allows the NEA, DOE and MinDA to propose projects that about 12,000 households. cover electrification, installation of RE and/or livelihood programs using RE in areas where peace and order is a The DOE also finalized its initial list of QTP Service Areas problem and poverty is prevalent. and targeted to be declared by last quarter of 2020 with due consideration to the readiness of the concerned DUs The three agencies, in coordination with EU-ASEP, are pursuant to the guidelines. currently shortlisting projects submitted by either the ECs, the LGU or the NGOs and assessing the readiness in European Union (EU) Grant to NEA terms of documentary requirements and project status. The projects are to be submitted to EU by September 15 The EU on 30 July 2020 issued a letter to NEA awarding for approval, after which the project implementation will the agency a grant amounting to € 4.5 million to commence.

Technology Target HHs Proponent

Rio Tuba, Bataraza, Palawan 1.05 MW Diesel-Biomass 1,744 PSPI

Malapascua, Daan-Bantayan, Cebu 750 kW Diesel 771 PSPI

Hybrid: 1.5 MW Solar + 1.2 MW Sabang, Puerto Princesa City, Palawan 683 SREC Diesel + 2.3 MWh Battery

Candawaga & Culasian, Rizal, Palawan 268 kW Diesel 998 PSPI

Balut Island, Saranggani, Davao Occ. 690 kW Diesel 3,570 PSPI

Liminangcong, Taytay, Palawan 108 kW Diesel 709 PSPI

Line extension from Brgy. Tumbod, Taytay, Palawan 395 PSPI Liminangcong

246 kWp Solar + 400 kW Lahuy Island, Caramoan, Camarines Sur 550 FPIEC Diesel + 76kWh Battery

Haponan Island, Caramoan, Camarines Sur 51.4 kWp Solar + 100 kW Diesel 87 FPIEC

331 kWp Solar + 500 kW Diesel Quinasalag Island, Manicipality of Garchitorena 705 FPIEC + 80 kWh Battery

Hybrid: 132.8 kWp Solar + 144 kW Brgy. Poblacion, Dumaraan, Palawan 331 PSPI Diesel + 351.1 kWh Battery

Brgy. Manamoc, Cuyo, Palawan 316 kW Diesel 560 PSPI

Hybrid: 200 kWp + 609.5 kW Diesel Brgy. Port Barton, San Vicente, Palawan 900 PSPI Diesel + 200 kWh Battery

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 45 INITIATING GOOD GOVERNANCE AND TRANSPARENCY

Realizing the important role of energy in the economy, of Sub-Attributes for EPNS; and (iii) the Resolution President Duterte issued several policies intended to on Deemed Approved for those CEPNS holders with simplify and streamline the government’s regulatory applications for permits, licenses and endorsements procedures, while safeguarding the rights of the people lodged to different government agencies and LGUs that engaged in doing business. already exceeded the 30-working day timeframe.

On 28 June 2017, the President signed the Executive Order No. 30 (EO 30), which created the Energy Investment EXECUTIVE ORDER NO. 30 Coordinating Council (EICC). The EICC is mandated to establish a simplified approval process and harmonize the relevant rules and regulations affecting energy Applications projects in order to guarantee the delivery of sufficient, issued with adequate and reliable supply of energy in the country. 149 CEPNS (as of Dec 2020) As of December 2020, a total of 149 certificates of energy project of national significance (CEPNS) have been issued, of which 134 projects are in the commerciality stage, while 15 projects are in the pre-development stage. These projects are estimated to pour in an estimated PhP794.5 billion of investment. These CEPNS projects are given the Potential rights to a processing time of 30-working day period upon 795 investments submission of complete documentary requirements to Billion Php relevant permitting agencies including LGUs.

To accelerate the permitting process and strengthen the implementation of EO 30, several interventions were done such as consultative meetings and FGDs with LGUs and To evaluate the effectiveness of CEPNS, the DOE, as various agencies involved in permitting process. The IECC chair of the EICC, issued an advisory suspending the was also able to formulate and issue three (3) resolutions, issuance of CEPNS to give way to a thorough evaluation namely: (i) Resolution on the Creation of Focus Group to with respect to securing regulatory permits and licenses, Resolve Cross-Cutting Issues, Conflicting Requirements endorsements and other requirements relevant to the and Procedural Bottlenecks in the Issuance of Permits, timely development and completion of energy projects. Licenses and Clearances; (ii) Resolution on the Adoption In parallel with the CEPNS process evaluation, all

46 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 applications for CEPNS will be automatically migrated to the application process. Overall, it aims to have a swift the Energy Virtual One-Stop Shop (EVOSS) System. application process and to promote a healthy competitive environment for investors by attracting more energy To take advantage of the information technology in the investments in the country to meet, and even exceed, the permitting process, RA 11234 or the “Energy Virtual One- needed energy capacities of the country moving forward. Stop Shop (EVOSS) Act” was enacted on 19 March 2019. The EVOSS is an online platform that intends to facilitate An EVOSS Steering Committee has been created and energy application process by eliminating redundant chaired by the Office of the President with the DOE as Vice-Chair. The Committee has a life span of two (2) processes and documents among government agencies, years starting from the date of the issuance of the Act. processes within the DOE and the attached agencies such as the NPC, NEA, ERC, NGCP, and TransCo. It On its 2nd year of implementation, the EVOSS implemented also intends to fast track the application process by several activities even during the pandemic. Most of reducing the processing time and the necessary steps which were virtual meetings and consultations with the to facilitate energy related permits and applications. The concerned government agencies on the streamlining transparency of the application process using the online of processes, enhancement of the EVOSS System, user platform will also reduce bureaucratic red tape and at acceptance testing, orientation and hands-on trainings, the same time update the developers or applicants on facilitation of online payment system, conduct of the the real time status of their application. The platform steering committee meetings, and procurement of hosting will also utilize online payment facility to fully automate service for the EVOSS Servers.

With the EVOSS Law in place, red tape in the energy sector will soon become a thing of the past as it promotes faster, simplified permitting process that would allow foreign and domestic investors with the capacity to build cutting- edge power plants to enter the market and stimulate competition in the Philippine energy generation industry.

SENATOR SHERWIN GATCHALIAN Chair, Committee on Energy

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 47 ENERGY VIRTUAL ONE-STOP SHOP (EVOSS)

• Recognize the legal effect, validity and enforceability of electronic FUNCTIONS documents submitted • Establish a system of high availability, business continuity and cyber security • Utilize a technology platform and an operations management software platform to build defined processes and forms within a strict timeframe using published standards

• Operate as a 100% virtual storage and rules driven system built as CHARACTERISTICS an integrated shared service • Provides a secure and accessible paperless system (Section 6 of RA 11234) • Utilizes online payment system for all fees imposed for applications • Provides a secure and accessible system for all Government agencies and entities involved in the permitting process

The government also issued significant policies to services covering business-related and non-business eradicate inefficiencies in the bureaucracy. These include transactions. RA 11032 or the “Ease of Doing Business and Efficient Since EO 30, EVOSS Law and EODB provide specific Government Service Delivery Act of 2018 (EODB),” which timeframes in permitting process, the government issued was issued on 28 May 2018. Distinct from the EVOSS Act Administrative Order (AO) 23 “Eliminating Overregulation and the EO 30, the EODB applies to all government offices to Promote Efficiency of Government Processes” to and agencies in the executive branch including LGUs, eliminate overregulation and improve the government government owned or controlled corporations (GOCC), system in delivering services to the people. The AO and other government instrumentalities, which provide stipulates that the timelines provided for by the EVOSS Act shall be complied and applied to all processes/procedures TIME FRAME relative to all energy projects. TOTAL NO. OF To harmonize and fast track the implementation of EVOSS AGENCY CALENDAR DAYS Act, EODB Act, EO 30 and AO 23, the DOE and DILG issued 61 DOE 60 a Joint Memorandum Circular (JMC) 2020-01 dated 30 April 2020 or the “LGU Energy Code,” which provides the DAR 75 guidelines for LGUs to facilitate the implementation of DA 60 energy projects. The JMC likewise intends to integrate DENR 120 national energy plans, programs, policies, and mechanisms ERC in the local development plans, maximize the benefits All Applications 60 of energy projects to host communities, and implement Quasi-judicial Cases 270 other energy programs to spur development of the LGUs. Systems Operator & 150 Transmission Network Provider Transparency Initiatives NWRB 60 The DOE garnered an award as the “Champion in IEMOP 15 Excellence in Reporting” from the Philippine Extractive DOTr 30 Industries Transparency Initiative (PH-EITI) during the PH- PNP 15 EITI Awards Ceremony at the Hotel Jen in Pasay City on 18 DPWH 30 September 2019. PNRI 15 The PH-EITI was created to help the government promote Other Agencies 15 transparency within the private and public sectors, LGUS particularly in the disclosure of payments and revenues. Cities 15 Municipalities 15 Among the DOE’s contributions to the Philippine EITI Provinces 15 NCIP Work Plan were the transparent financial and technical CNO 10 monitoring of the Malampaya funds, which resulted in the FPIC 105 implementation of transparency programs and policies.

61 JMC 2020-01

48 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 Developed an Online Application Systems On 16 December 2019, Attestation was received by the DOE with its successful completion of the annual In collaboration with the Advance Science and Technology surveillance audit conducted on 25-27 November 2019 Institute of the DOST, the DOE developed the Downstream and awarded with QMS Certification Nos. SCP00004240 Oil and Natural Gas Online Application System, a web- and SCUK0018570 valid until 18-19 December 2021 in based information management system that automates accordance with the requirements of ISO 9001:2015 - the processing and monitoring of service applications Quality Management System for the maintenance and filed by clients. It likewise records details of conducted continued certification and delivery of better government field validation of facilities, monitors the response of services through an effective QMS. facility representatives to their violations and generates reports based on the available data in the system. The system was launched on 11 December 2019 in Taguig City.

ISO 9001:2015 Certification

The DOE’s continuous support to the intent of EO 605 (Institutionalizing the Structure, Mechanisms and Standards to Implement the Government Quality Management Program) has led to the ISO certification61 by SOCOTEC Certification Phils., Inc. (Formerly AJA Registrars, Inc.).

In 2019, the First Surveillance Audit was conducted for the certified processes in 2018 and extension of scope enrolled in 2019 by different bureaus, services, and other units of the DOE including Field Offices in Luzon, Visayas The DOE, represented by Dir. Araceli Soluta of the Financial Services and Asst. Dir. Ismael U. Ocampo of the Energy Resource Development Bureau, and Mindanao. The same scope was continued during received the Excellence in Reporting Award during the PH-EITI awarding the second surveillance in 2020. ceremony held in 2019

ISO 9001:2015 ISO 9001:2015 QUALITY MANAGEMENT SYSTEMS QUALITY MANAGEMENT SYSTEMS

• Application for Registration of • Energy Performance Testing of ERDB Petroleum Sub-Contracts ERTLS (LATL) Household Appliances and Lighting Energy Resource • Application for Safety Engineers and/or Energy Research and Systems Development Bureau Safety Inspectors Permit Testing Laboratory

• Testing of Biofuels - Coconut Methel OIMB • Issuance of Securities and Exchange Ester (B100) Oil Industry Commission Endorsement • Testing of Biofuels - Anhydrous Management Bureau Bioethanol and Bioethanol Fuel ERTLS (GRTL) • Testing of Petroleum Products - CME - Energy Research and Blended Automotive Diesel Oil • Provision of Philippine Energy Plan (PEP) Testing Laboratory • Testing of Petroleum Products - EPPB Data/Key Energy Statistics and Other E-Gasoline Fuel Energy Policy and Energy Related Indicators/Information • Testing of Petroleum Products - Planning Bureau to Various Clients Fuel Oils (Bunker) EUMB • Energy Audit Services: Preliminary AS (HRMD) Energy Utilization and • Recruitment Process Energy Administrative Services Management Bureau EPIMB AS (RMD) Electric Power Industry • Processing of Endorsement to the SEC • Receiving of Incoming Documents Administrative Services Management Bureau REMB • Processing of Safety Officer’s Permit FS (CERCD) • Accreditation of Insurance/Bonding Renewable Energy Applications for Geothermal Energy Financial Services Companies Management Bureau Developers

IPO • Provision of Information and Assistance Investment Promotion to investors Field Offices Office Luzon Field Office • Issuance of SEC Endorsement (Bunker) CWPO Visayas Field Office • Complains Handling for Walk-in Mindanao Field Office Consumer Welfare and Customers Protection Office

61 PAB Certificate No. AJA18-0200 and UKAS Certificate No. AJA18-19033

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 49 ESTABLISHING A RESILIENT ENERGY SECTOR

As the country remains vulnerable to typhoons and other Kammuri (Tisoy) and Typhoon Phanfone (Ursula) in the natural disasters, the DOE is keen on providing continuous various regions of Southern Luzon and Central Visayas. energy supply to sustain economic growth. With this in mind, Secretary Cusi issued a policy63 on 17 January 2018 Gearing towards the total rehabilitation of affected areas, for the “Adoption of Energy Resiliency in the Planning 2020 was considered to be the tipping point of disaster and Programming of the Energy Sector to Mitigate Potential Impacts of Disasters.” The Energy Resiliency Policy aims to strengthen existing infrastructure facilities, incorporate mitigation improvements into the reconstruction and rehabilitation, improve operational and maintenance standards and practices, and develop resiliency standards.

At the start of 2019, the DOE carried out extended response to Tropical Cyclone “Usman” (28-29 December 2018) that caused widespread flooding due to heavy rainfall over the Southern Luzon and Eastern Visayas. Typhoon “Usman” affected 22 diesel power plants of the NPC-Small Power Utilities Group (SPUG) in Bicol, Marinduque, Quezon and Eastern Visayas areas, tripped 12 transmission facilites and affected 14 ECs. Energy system was restored at fastest way possible.

Likewise, 2019 was considered a year of earthquakes that generated destructive magnitudes in frequent occurrences. While these events presented new challenges in the energy sector, it helped in evaluating and updating of existing disaster plans and protocols for better earthquake resiliency. The year closed with the Restoration is in full-swing: ILECO I and AKELCO restoring power lines in energy sector addressing devastations left by Typhoon Kalibo International Airport

63 DC No. 2018-01-0001 64 Market Intervention was declared on 12 January 2020.

50 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 response. Taal Volcano erupted and ashes fell that respective Operation Centers, undertake continuous affected several energy facilities.64 It caused widespread monitoring of the situation, conduct precautionary power interruptions due to ash-laden areas affecting measures, implement action plans or contingency plans DUs, transmission lines and power plants. Focusing and mitigating measures, and submit regularly status of on the rehabilitation of Taal Volcano affected areas, a facilities/systems/areas, including any problem that may threat was recorded that may hamper the delivery of oil affect energy supply. Instantaneously, the NGCP activated supply. With this, the DOE called upon the downstream oil its 24/7 monitoring for the status of transmission facilities, industry participants to ensure oil supply of the country and the NEA advised all the concerned ECs to take and to focus on the affected areas. appropriate measures to address the potential impacts that might affect the delivery of electricity service. When the COVID-19 hit the country, it changed the landscape of disaster response. The energy sector was Typhoons tagged as the “backliner” that ensured energy services were delivered to every household. Amid COVID-19, three The TFER has been steadfast in mitigating and (3) remarkable tropical cyclones made landfalls to the addressing the impacts of strong typhoons that left country – Typhoon Quinta, Super Typhoon Rolly and damages to energy infrastructure. The TFER consistently Typhoon Ulysses. The series of tropical cyclones left ensured that preparedness measures and power massive destruction to energy facilities that prompted restoration procedures and protocols were strategically the activation of Task Force on Energy Resiliency (TFER) implemented for the quick restoration of power services. and Task Force Kapatid. The entire energy sector worked The members of the Task Force activated their respective non-stop to restore the energy services in the affected contingency plans, while the NEA advised all the ECs to areas. be affected by the typhoon to activate their Emergency Response Organization and implement the Emergency In the light of all these calamities, the entire energy family Response Plan. The NGCP together with TransCo worked together in order to restore energy services and implemented necessary preparations and precautions to build confidence in the Philippine economy. minimize the impact on power plants in off-grid areas and Meralco transmission operations and facilities Secured Energy Facilities During Emergencies as prescribed in the Integrated Disaster Action Plan Earthquakes (IDAP). On the other hand, the NPC-SPUG implemented contingency plans for its diesel carried out preparedness After each earthquake that struck the country, the TFER measures to mitigate the effects and for immediate immediately alerted its members to implement their restoration of power services in its franchise area.

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 51

Earthquake

Power Generation Transmission Distribution Oil Supply

Magnitude 6.1 • Four (4) power • Eight (8) transmission • One (1) private • A price freeze for Earthquake in plants went on lines were isolated. distribution household liquefied Castillejos, Zambales unplanned / and 15 electric petroleum gas forced outage cooperatives (LPG) and kerosene 5:11 PM, 22 April 2019 with total capacity were affected. products after of 780MW the declaration of State of Calamity in Pampanga on 22 April 2019.

Magnitude 5.9 • Itbayat DPP went • Not applicable Batanes Electric • Petron gasoline Earthquake in Itbayat on automatic Cooperative station in Basco, (Batanes) shutdown as of (BATANELCO) Batanes was under 4:20 AM. At 11:00 normal operation 4:16 AM, 27 July 2019 AM, Itbayat DPP • Out of 885 but advised to stop was ready for original number operations due to operation and of households, aftershocks. waiting for signal 113 households • No reported to operate from were totally damages on fuel BATANELCO. damaged by the station in Basco, earthquake. Batanes. Fuel supply • Date/Time Off: was normal at 60 07/27/2019 kiloliter (kl) per @0350H month. • Date Restored: 08/02/2019

Cotabato Fault • Mindanao • The Mindanao • DASURECO • Nine (9) gasoline System Earthquake Geothermal transmission backbone (Davao del Sur) stations in some Series Power Plant remained intact. and COTELCO parts of Cotabato (MGPP) and Mt. However, NGCP’s (North Cotabato) and Digos have Apo’s Geothermal Kidapawan substation were affected. been temporarily Power Plant suffered damages. closed due to minor (MAGPP) Units damages and/or 1 and 2 were as a precautionary affected. safety measure.

Ms6.9 Earthquake in • Five (5) power • Power transmission • DASURECO • Two (2) gasoline Davao Del Sur plants with total services of Mindanao (Davao del Sur) stations in capacity of 309 remained normal. and COTELCO Digos were non- 2:11 PM, 15 December MW went on • The Mindanao Grid (North Cotabato) operational due to 2019 unplanned / remained intact. were affected. structural damage. forced outage However, three (3) but were restored Transmission Lines immediately. tripped due to the earthquake.

52 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 WHAT HAPPENED TO CATANDUANES?

It was 31st of October 2020 at 2:00 AM when provincial counterparts – common question Super Typhoon Rolly intensified. as to what happened to Catanduanes. The Task Force on Energy Resiliency Secretariat Far from being the “usual typhoon”, it received a call from NEA seeking assistance prompted several measures to get away to contact First Catanduanes Electric from harm – residents living in danger zone Cooperative, Inc. (FICELCO). transferred to a safer place. This is a familiar situation with the National Power Corporation The NDRRMC sent emergency - Marinawa Diesel Power Plant (DPP) wherein telecommunication system to connect nearby families seek shelter in the plant. the Provincial Government to the National Agencies. DOE Undersecretary Fuentebella It took only overnight – a nightmare for was in NDRRMC’s Operations Center when residents of Catanduanes. “Para kaming communications went through. As expected, nililindol sa lakas,” Governor Cua described they reported provincial-wide power his experienced with STY Rolly. interruption; good thing, oil supply was sufficient. Afterwards, DOE personnel were Reports started coming in the morning, sent to Catanduanes to assess the situation. but no information were received from Catanduanes. Slowly, picture became clearer.

National agencies were rummaging through Catanduanes was the ground-zero of STY several communication lines looking for their Rolly.

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 53 Task Force Kapatid Volcanic Eruption

To pool assistance for ECs frequently ravaged Upon receipt of the alert status from DOST-PHIVOLCS by typhoons and other calamities, a compact of on 12 January 2020 for Taal Volcano, TFER alerted cooperation—referred to as “Task Force Kapatid” or its members pursuant to the DOE’s Energy Resiliency TFK— was formally institutionalized between the NEA Policy. The NGCP immediately implemented and the ECs in September 2002. The creation of the task contingency measures and reported the six (6) affected force laid the groundwork for sister ECs to group together transmission lines. The NEA reported two (2) affected and provide assistance to calamity-hit ECs through ECs – Batangas I Electric Cooperative (BATELEC I) and immediate mobilization and deployment of engineers, Batangas II Electric Cooperative (BATELEC II) – with a electricians, linemen, and foremen, including equipment total 251,917 household connections in 349 barangays. and machineries. The MERALCO franchise areas recorded a total of In 2019, the TFK dubbed as the Power Restoration Rapid 183,538 affected customers in the provinces of Cavite Deployment (PRRD) was mobilized during Typhoons and Laguna due to ash fall. Tisoy and Ursula with a total number of 972 contingents Immediately after the eruption, the DOE conducted and 173 boom trucks/utility vehicles. electrical inspections of service drops, panel conditions, In partnership with Philippine Rural Electric Cooperatives and load types of lighting, fans, and charging to ensure Association Inc. (PHILRECA), the NEA activated the TFK that proper power services are being provided in the to help the restoration of areas affected by Typhoons evacuation centers in the affected areas. The DOE Quinta, Rolly and Ulysses. Strong 461 line workers from also distributed emergency lights, portable solar power 61 assisting ECs rendered their service to affected areas. lamps, solar power banks, and clothing to volunteers.

eos.org

54 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 Strengthening infrastructure refers to the physical construction and other Systems refer to administrative structural measures to reduce directives, organizations, or avoid possible impacts of operational skills and capacities, hazards, or the application of policies, guidelines, plans engineering techniques or to implement strategies technology to achieve and improved coping hazard resistance capacities to lessen and resilience in the adverse impacts structures or of hazards. systems.

Strengthening Systems Infrastructure

Stockpiling Response and Response and Recovery refer to Stockpiling Recovery the provision of refers to emergency services the disaster and public assistance mitigation during or immediately process of after a disaster; identification and and the restoration procuring essential and improvement of inventory items facilities, livelihood and living beforehand. conditions of disaster-affected communities, including efforts to reduce disaster risk factors, in accordance with the principles of "Build Back Better".

With the declaration of a “State of Calamity (SOC)” in earthquakes are recorded daily. As a threat, the the province of Batangas, the DOE effected a price magnitude 7.2 earthquake that would result from the freeze for household LPG and kerosene products. The movement of the West Valley Fault (WVF) system, also DOE accounted 22 gasoline stations in Batangas, two known as the “Big One,” will yield as high as intensity (2) in Laguna and seven (7) in Cavite that became not VIII with foreseen massive destruction in Metro Manila operational due to ash fall and other restrictions. and impact to the human development, infrastructure, facilities, environment as well as the response capability Energy Resiliency Roadmap of the government.

With an overall objective of mainstreaming Disaster Risk As energy is considered as the lifeline and should be Reduction and Management (DRRM) plans, frameworks made available especially during emergencies and and policies into the energy sector, the Energy Resiliency disasters, the DOE sits as member of the Earthquake Roadmap will set the course and direction of the sector Resiliency Team (ERT) of the NDRRMC under the Logistics towards achieving a higher level of energy Resiliency. This Cluster. The TFER is expected to make all the necessary will be developed through a sectoral approach to include resiliency measures in order deliver its mandate in times the upstream oil and gas, downstream oil and gas, power, of disasters. renewable energy, and energy utilization. The roadmap will be aligned and guided with the principles stipulated in The DOE, in partnership with the Philippine Disaster the Energy Resiliency Policy. Resiliency Foundation, Inc. (PDRF), is currently Prepared for the “Big One” updating the National Energy Contingency Plan (NECP) specifically to identify the potential impact of the “Big The Philippines seated along the Pacific Ring of Fire is One” in the entire value chain of the energy sector and prone to natural hazards like earthquake and volcanic harmonize the contingency and response plans of the eruption. According to PHIVOLCS, an average of 20 energy sector.

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 55 The DOE’s Task Force on Energy Resiliency in partnership with the Philippine Disaster Resiliency Foundation, Inc. conducted information campaigns and workshops in relation to the formulation of the National Energy Contingency Plan

Analysis of Resiliency Compliance Plans (RCP) The energy sector is moving toward mainstreaming the culture of resiliency through strengthening the energy The RCP intends to mainstream disaster risk reduction infrastructure, establishing standards and systems, programs into planning and investments to ensure formulating response and recovery protocols, mitigation/ continuous delivery and enhance existing energy contingency plans and activities to address the impacts infrastructure. It provides both engineering and non- of disasters on energy supply and services. Integrating engineering measures to ensure infrastructure and human energy resiliency into development planning and disaster resource disaster preparedness. Likewise, it encompasses operations of the energy sector will propel the formulation activities such as stockpiling, system development and of DRRM plans, frameworks, and policies of the energy planning, response and recovery including disaster sector, conduct of operations during emergencies and protocols. A total of 147 RCPs were submitted to the disasters and ensure building back better reconstruction DOE across the different sectors. With the updating of and rehabilitation of affected energy facilities. Key the RCPs due in 2021, the TFER will evaluate its status and activities initially identified are: applicability in the emerging risks.

Issuance of New Resiliency Policies and Next Steps • Developing a sector-based preparedness plan encompassing capacity building, energy response Cognizance of the vital contribution of energy in fueling the activities including standard operating procedures economy, any disruption or failure in the energy system and other operational manuals linkages; would have negative consequences on the country’s • Designing and programming the disaster risk and economic activities and daily life of the people. With reduction (DRR) activities of the energy sector; this backdrop, the development of the energy sector’s • Conducting researches on related DRR programs, DRRM plans, policies, programs, and standards operating policies, and activities of the energy sector; procedures is crucial to ensuring continuous delivery of • Formulating DRRM risk assessment and plan, energy services to the economy and the public. framework and policies of the energy sector;

56 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 • Disseminating information and raise public of an “Energy Committee under the Bayanihan to Heal as awareness of DRRM related activities of the energy One Act,” to ensure compliance to the said Act on 02 April sector; 2020. • Conducting continuous monitoring and mobilizing personnel during emergencies; The DOE also directed the power stakeholders to submit • Establishing linkages with the stakeholders before, their respective Business Continuity Plan (BCP) under the during and after emergencies and disasters; ECQ and further expanded to include energy resource • Conducting comprehensive damage and loss development and downstream oil stakeholders. assessment in the energy sector; Secretary Cusi issued the policy on 6 April 2020, • Conducting periodic monitoring and inspection of “Rationalizing the Utilization of ER 1-94 Fund by the host rehabilitation programs and projects of the energy LGUs in response to COVID-19 Public Health Emergency,”66 sector; which provided for the utilization of such funds by the host • Formulating standards for rehabilitation LGUs to strengthen their programs and measures against development for inclusion in the DRR measures in COVID-19 during this period. The funds can be used for the the energy sector; and, following: • Assisting in processing and evaluating proposals for funding of projects and activities. • Facilitation of mass testing by providing and constructing facilities and/or acquiring proper COVID-19 PANDEMIC RESPONSE medical testing kits to detect COVID-19; • Provision of an emergency subsidy in the form of The DOE, together with its attached agencies, remained non-food to low income households while the State resolute in the implementation of concerted efforts of Public Health Emergency is still in effect; and and emergency measures to provide the country with • Adoption of measures to minimize disruption in the unhampered delivery of energy services in support of the supply chain, among others. whole of government’s effort to address the pandemic situation brought about by COVID-19. On 07 May 2020, an “Advisory on Providing Grace Period to all Power Sector Bills Falling Due during the ECQ as As early as February 2020, the DOE called for an extended until 15 May 2020” was released for guidance of emergency meeting with stakeholders from the all electric power industry participants. All bills being paid downstream oil industry to ensure sufficient oil supply during the extended grace period shall bear no interest, in the country. Following the President’s issuance of penalties, fees and charges. Proclamation No. 922 declaring a state of public health emergency in the country, Secretary Cusi issued a In response to the issued AO of the Department of Health Memorandum on 14 March 2020 to all government (DOH), the DOE also released a Department Order67 on 29 agencies, LGUs and energy-related service providers April 2020 “Providing for Minimum Health Standards for regarding the Implementation of the Memorandum from COVID-19 Mitigation to DOE Personnel and its Workplace the Office of the Executive Secretary dated 13 March and Shared for Application to All Players and Stakeholders 2020 on Ensuring the Unimpeded Delivery of Energy in the Entire Energy Industry.” Services that covers movement of energy-related goods and energy personnel, management of permits, As a result of submitted BCPs of the energy stakeholders, 68 and adherence to health precautionary measures. The the DOE issued “COVID-19 Response Protocol” on 21 Bayanihan Energy Service 24/7 hotline was likewise put May 2020. The Protocol’s general framework is based on in place to respond to all energy-related concerns during the following interventions: (1) Prevention, (2) Detection, the Enhanced Community Quarantine (ECQ). (3) Isolation, (4) Treatment, (5) Reintegration to the Workforce, and (6) Adapting to the “New Normal. For the On 18 March 2020, a Memorandum from the Energy DOE and its attached agencies, the COVID-19 Response Secretary was issued calling on public and private power Protocol shall be incorporated in their respective Public sector corporations to defer payments of obligations and Service Continuity Plans (PSCPs), while energy industry dues for 30 days after the conclusion of the ECQ period players are required to incorporate the same into their on 14 April 2020. BCPs, or their equivalent. Subsequently, a PSCP69 of the DOE was released on 26 June 2020 to establish protocols, Upon the passage of Bayanihan to Heal as One Act,65 measures and strategies for managing the immediate Secretary Cusi released a Special Order for the Creation consequences of the COVID-19 pandemic.

65 Republic Act No. 11469 68 AO 2020-05-0001 66 DC 2020-04-0008 69 DO 2020-06-001 67 DO 2020-04-007

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 57 FOSTERING REGIONAL ALLIANCE

The Philippine government is represented by the DOE in In these regional organizations, the mechanism by several energy sector organizations in the international which energy cooperation initiatives are conceptualized, arena. These include, but is not limited to the following: a) adopted, and implemented follow a hierarchy of Asia Pacific Economic Cooperation (APEC), b) Association deliberate consultations and discussions. The Energy of South East Asian Nations (ASEAN), c) East Asia Summit Ministers’ Meetings provide political guidance and (EAS), d) Brunei-Indonesia-Malaysia-Philippines East directions on the development and implementation of ASEAN Growth Area (BIMP-EAGA). key priority initiatives and work programs within a region

Senior Underseccretary Jesus Cristino P. Posadas headed the Philippine delegation to the virtual 38th Senior Officials Meeting on Energy and Associated Meetings on 24-27 Auigust 2020

58 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 as directed/instructed by the Leaders (Heads of States/ Committee (ADC) Meeting, 11th SOME-International Energy Governments). In said meetings, the Secretary of Energy Agency (IEA) Dialogue, 2nd SOME-International Renewable is the Philippine representative who heads the Philippine Energy Agency (IRENA) Dialogue, 19th SOME+3 Energy Delegation during interactive discussions among Energy Policy Governing Group (EPPG) Meeting, 21st SOME- Ministers. Ministry of Economic, Trade and Industry (METI), Japan Consultation, 11th SOME-United States (US) Consultation, On the other hand, the Senior Officials on Energy 11th SOME-Russia Consultation, and the 25th East Asia (SOEs), represented by Undersecretary or Assistant Summit (EAS) Energy Cooperation Task Force (ECTF) Secretary level, deliberate and endorse initiatives in Meeting. scheduled formal meetings (e.g. Energy Working Group Meeting/Senior Officials Meeting on Energy or EWG/ On the other hand, Brunei Darussalam hosted a Special SOME) for adoption of the Energy Ministers. The SOEs BIMP-EAGA Power and Energy Infrastructure Cluster give guidance/directions to Working Groups (WGs), (PEIC) Meeting, held virtually on 02 September 2020. The Specialized Bodies, Sub-Sector Networks (SSNs), Experts’ discussions focused on the issues and responses of the Groups (EGs), Task Forces (TFs), Workstreams (WSs), and member states on the effects of COVID-19 pandemic in Clusters Groups (CGs), as well as, steer the SOE meetings the sub-region70. It was revealed that the pandemic has during presentation of cooperation initiatives. disrupted the energy landscape and current uncertainties are driving member states to adjust their respective On 24-27 August 2020, the DOE attended the Virtual 38th energy plans. However, the pandemic also provided a Senior Officials Meeting on Energy (SOME) and Associated positive impact especially on the environment in terms of Meetings where the ASEAN Plan of Action on Energy reduced CO2 emission in large urban cities of ASEAN like Cooperation (APAEC) Phase II: 2021-2025 was adopted. Kuala Lumpur, Manila and Bangkok due to low activities During the meeting, the DOE highlighted the need to in the transportation and manufacturing sectors. rethink and jointly act on how the region can continue to pursue stronger regional collaborations and cooperation The Philippines shared its experience on the impact of the on energy resource exploration, development, and COVID-19 pandemic, particularly on the ECs in Mindanao. production within ASEAN’s shared and common borders. The Philippines stressed that energy demand in certain areas in Mindanao declined due to quarantine restrictions, Other meetings held at the sidelines of the 38th SOME which affected the economic activities of the region. The were the ASEAN Plan on Energy Action or APAEC Drafting residential customers and small and medium enterprises

70 The Asian Development Bank (ADB) shared its perspectives on the for Energy (ACE) shared its findings and perspective particularly on issues brought about by the current pandemic, while the ASEAN Centre the power sector in the ASEAN Countries.

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 59 With all of us sharing the common aspiration of attaining energy security for our respective countries, we must maximize the advantages of belonging to this multilateral Association in order to fast track its realization.

We must not allow ourselves to become paralyzed in the face of adversities. I am confident that should we choose to put our heads together and establish sound contingency protocols, our region’s power sector would come out even stronger than before.

Sec. Alfonso G. Cusi Department of Energy

were given extension on payment of electricity bills. Due ASEAN Power Utilities/Authorities (HAPUA) to integrate to difficulty in collecting payments from consumers, the emergency preparedness and resiliency in its future work ECs were also given extension on the payments of loans plan, instead of limiting itself to the physical aspect of and payments to generation companies. power grid interconnection. With the Philippines being a victim of climate change, the DOE took the opportunity to The Cluster also discussed the status and updates of the call for “Climate Justice.” Emphasizing that years and ongoing projects under the Rolling Pipelines 1 (2017-2019) years of climate injustice brought about by bigger, richer on the interconnection and enclave projects implemented and more developed nations that were able to pursue by each member countries. rapid industrialization with reckless abandon, has left the Philippines at a delicate crossroads of balancing the During the 38th ASEAN Ministers on Energy Meeting need to fulfill our energy requirements without sacrificing (AMEM) held from 17 to 20 November 2020, the Ministers the future of the coming generations. To attain this, the endorsed the successor APAEC Phase II: 2021-2025 as DOE strongly stated its commitment to fully implement adopted by the Senior Officials in August 2020. In this meeting, the DOE expressed its call for joint exploration RE Act for increased share of clean energy technologies activities among ASEAN member states and raised the in its energy mix. importance of integrating resilience in future power The DOE also represented the Philippines to the Virtual work plans. Secretary Cusi also highlighted the lifting of 59th and 60th APEC Energy Working Group (EWG) and suspension of petroleum activities and resumption of oil Associated Meetings held from 26-27 August 2020 and and gas exploration in the West Philippine Sea. 7-11 December 2020, respectively which served as a Likewise, the Philippine Energy chief requested the platform to discuss energy security initiatives (ESI) and ASEAN Council on Petroleum (ASCOPE) to revisit the the EWG’s current and future initiatives in consideration existing sharing agreements on oil and gas exploration of the COVID-19 pandemic which affected the ongoing and production, and to recommend similar or modified and planned EWG projects for 2020. agreements for possible adoption in order to attain energy security in ASEAN. At the sidelines of both EWG Meetings, the Philippines co- chaired the Energy Resilience Task Force (ERTF) Meeting With the growing recurrence and intensity of various with the United States wherein status updates on the calamities that hit the Philippines and other parts of current and proposed energy resiliency projects were the world, Secretary Cusi also called on the Heads of discussed among the APEC member economies.

70 An initiative spearheaded by the United Nations Office of Project Services (UNOPS) and Agence Française De Dévelopement (AFD)

60 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 On bilateral cooperation, the Philippines and India are On the other hand, the 2nd Philippines-Hungary Joint now finalizing the new draft MOU between the Philippine Commission on Economic Cooperation (JCEC) Meeting DOE and the Ministry of New and Renewable Energy of held virtually and face to face on 3-4 December 2020 India on Cooperation in the Field of Renewable Energy. at the Dusit Thani, Manila, both Parties expressed its With this, the Philippines is also considering to be a openness on the possibility to pursue cooperation in the regular member of the India-led International Solar field of nuclear energy. Alliance from its current observer status. India is more advanced in the fields of solar and wind (particularly on Outcomes of the Philippine-Russia Meeting held on 26 offshore wind installations), biomass and biofuels, and November 2020 highlighted Russia’s interest in pursuing in hydropower. In return, the DOE can share expertise energy cooperation with the Philippines, especially in and provide capacity building in the field of geothermal the areas of hydroelectric, natural gas exploration and energy through trainings and seminars. nuclear energy development.

The Philippines also expressed its interest to pursue Aside from abovementioned energy-cooperation cooperation in renewables, energy efficiency and meetings and undertakings, the DOE has been keen and conservation, alternative fuel and energy technologies steadfast in joining the fellow Philippine government with France, as well as capacity and capability building on agencies through inter-agency committee (IAC) green skills and education. On the other hand, France is meetings spearheaded by the DTI and the DFA. These likewise interested to pursue nuclear energy cooperation. consultations adhere to the whole-of-government approach in strategizing the country’s best interest to During the 10th Philippine-Japan High Level Meeting further strengthen international relations with other on 28 October 2020 spearheaded by the DOF, both countries. Parties discussed the key updates for sectoral issues under Energy (Cooperation in the LNG Sector, Technical The DOE will also continue to foster stronger international Cooperation in the Power Sector) and Environment relations and partnerships through engagements in (Waste to Energy Project in Davao). bilateral and multilateral energy cooperation, among others. On the Southeast Asian Energy Transition Partnership (ETP)71, discussion on the draft plan for the areas in which ETP’s support could be useful for the Philippines are already in place and is expected to continue in the coming months.

71 An initiative spearheaded by the United Nations Office of Project Services (UNOPS) and Agence Française De Dévelopement (AFD)

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 61 List of Issuances

Department Circular No. 2019-01-0001 Department Circular No. 2019-07-0011 Prescribing the Omnibus Guidelines on Enhancing Off- Amending Various Issuances on the Implementation of Grid Power Development and Operation the Retail Competition and Open Access (RCOA)

Department Circular No. 2019-02-0002 Department Circular No. 2019-08-0012 Implementing the Specifications for PNS/DOE QS Providing a Framework for Energy Storage System in the 008:2018, E-Gasoline Fuel – Specification Electric Power Industry

Department Circular No. 2019-02-0003 Department Circular No. 2019-10-0013 Providing for the Framework Governing the Operations Omnibus Guidelines Governing the Award and of Embedded Generators Administration of Renewable Energy Contracts and the Department Circular No. 2019-02-0004 Registration of the Renewable Energy Developers Implementing the Natural Gas Quality Standard for all Natural Gas Supply in the Philippines Department Circular No. 2019-11-0014 Implementing Rules and Regulations of Republic Act No. Department Circular No. 2019-02-0005 11285 (Energy Efficiency and Conservation Act) Proper Retention of Duplicate Liquid Petroleum Fuel Samples in Depots and Retail Outlets Department Circular No. 2019-11-0015 Prescribing Revised Guidelines for Qualified Third Party Department Circular No. 2019-05-0006 Implementing the Specifications for PNS/DOE QS 004:2017 Department Circular No. 2019-12-0016 CME-Blended Automotive Diesel Oil and PNS/DOE QS Promulgating the Renewable Energy Market Rules 013:2017 CME-Blended Industrial Diesel Oil –Specifications Department Circular No. 2019-12-0017 Department Circular No. 2019-05-0007 Rules and Regulations Implementing Republic Act No. Adopting Further Amendments to the Wholesale 11234 (Energy Virtual One-Stop Shop Act) Electricity Spot Market (WESM) Rules and Market Manual on Guidelines on Significant Variations In and between Department Circular No. 2019-05-0008 Trading Intervals to Refine Publication Procedures Revised Guidelines for the Monitoring of Prices in the Sale of Petroleum Products by the Downstream Oil Industry in Department Circular No. 2019-12-0018 the Philippines Adopting a General Framework Governing the Provision and Utilization of Ancillary Services in the Grid Department Circular No. 2019-06-0009 Implementing the Modified Philippine National Standard Department Circular No. 2020-02-0002 Specifications for Liquefied Petroleum Gases (PNS/DOE The Implementing Rules and Regulations of Republic Act QS 005:2016 and PNS/DOE QS 012:2016) No. 11361, otherwise known as the “Anti-Obstruction of Department Circular No. 2019-06-0010 Power Lines Act” Prescribing the Administrative Operating Guidelines for the Availment and Utilization of Financial Benefits by the Department Circular No. 2020-02-0003 Indigenous Cultural Communities/Indigenous Peoples Providing a National Smart Grid Policy Framework for pursuant to the DOE Department Circular No. DC2018- the Philippine Electric Power Industry and Roadmap for 03-0005 Distribution Utilities

62 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 Department Circular No. 2020-02-0004 Department Circular No. 2020-06-0014 Providing Guidelines on the Planned Outage Schedules of Adopting Further Amendments to the Wholesale Power Plants and Transmission Facilities and the Public Electricity Spot Market (WESM) Rules and Market Manual Posting of the Grid Operating and Maintenance Program on Billing and Settlement for the Implementation of Enhancements to WESM Design and Operations Department Circular No. 2020-02-0005 Guidelines on the Duty-Free Importation and Monitoring Department Circular No. 2020-06-0015 of the Utilization of RE Machinery, Equipment, Materials Prescribing the Guidelines of the Philippine Energy and Spare Parts and their Transfer and Other Disposition Labeling Program (PELP) for Compliance of Importers, Manufacturers, Distributors and Dealers of Electrical Department Circular No. 2020-02-0006 Appliances and other Energy-Consuming Products (ECP) Rules and Regulations for the Selection, Review and Approval of Farm-out of PNOC Exploration Corporation Department Circular No. 2020-06-0016 (PNOC EC) Petroleum Service Contracts (PSCs) in Favor Prescribing the Minimum Energy Performance for of Third Parties and Farm-in of PNOC EC into Existing PSCs Products (MEPP) covered by the Philippine Energy Labeling Program (PELP) for Compliance of Importers, Department Circular No. 2020-03-0007 Manufacturers, Distributors, Dealers and Retailers of Amending Certain Sections of Department Circulars Energy-Consuming Products No. 2007-02-0001 entitled “Guidelines Implementing the Registration of Fuel Additives under Republic Act Nos. Department Circular No. 2020-07-0017 8479 and 8749” Promulgating the Guidelines Governing the Policy for the Conduct of Green Energy Auction in the Philippines Department Circular No. 2020-04-0008 Rationalizing the Utilization of ER 1-94 Funds by Host Department Circular No. 2020-09-0018 Local Government Units in Response to COVID-19 Public Guidelines in the Administration, Classification and Health Emergency Certification of Energy Service Company (ESCO)

Department Circular No. 2020-04-0009 Department Circular No. 2020-10-0019 Guidelines Governing the Issuance of Operating Permits Adopting Further Amendments to the Wholesale to Renewable Energy Suppliers under the Green Energy Electricity Spot Market (WESM) Manuals on Registration, Option Program Suspension and De-registration, and Market Network Model Development and Maintenance for the Department Circular No. 2020-04-0010 Implementation of Enhancements to WESM Design and Upstream Petroleum Operations Safety, Health and Operations Environment Rules and Regulations Department Circular No. 2020-10-0020 Department Circular No. 2020-05-0011 Adopting Further Amendments to the Wholesale Electricity Supplementing Department Circular No. DC2019-12-0018 Spot Market (WESM) Market Manual on Dispatch Protocol by Including the National Transmission Corporation in the for the Implementation of Enhancements to WESM Membership of the Ancillary Services - Technical Working Design and Operations Group Department Circular No. 2020-10-0021 Department Circular No. 2020-05-0012 Adopting Further Amendments to the Wholesale Guidelines Implementing the Temporary Modification of Electricity Spot Market (WESM) Rules Import Duty Rates on Crude Petroleum Oil and Refined Petroleum Products as Provided Under Executive Order Department Circular No. 2020-10-0022 (E.O.) No. 113 Prescribing the Policies to Enhance the Net-Metering Program for Renewable Energy Systems. Department Circular No. 2020-06-0013 Adopting Further Amendments to the Wholesale Electricity Department Circular No. 2020-10-0023 Spot Market (WESM) Rules and Market Manual on Prescribing Policy Framework for the Development of Registration, Suspension and De-Registration Criteria and the Fuel Economy Rating, Fuel Economy Performance, Procedures for the Implementation of Enhancements to and Related Energy Efficiency and Conservation WESM Design and the Implementation of Enhancements Policies for the Transport Sector and other Support to WESM Design and Operations Infrastructures

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 63 DOE Officials SECRETARY Alfonso G. Cusi

SENIOR UNDERSECRETARY HEAD EXECUTIVE ASSISTANT Jesus Cristino P. Posadas Ma. Teresa F. Mendoza

UNDERSECRETARIES ASSISTANT SECRETARIES Felix William B. Fuentebella Caron Aicitel E. Lascano Alexander S. Lopez Redentor E. Delola Donato D. Marcos Gerardo D. Erquiza, Jr. Emmanuel P. Juaneza Leonido J. Pulido III Benito L. Ranque Robert B. Uy

BUREAUS SERVICES Dir. Jesus T. Tamang Dir. Amelia M. de Guzman, CESO IV Energy Policy and Planning Bureau Energy Research and Testing Laboratory Services

Dir. Patrick T. Aquino, CESO III Dir. Herminio A. Ariola, CESO IV Energy Utilization Management Bureau Information Technology Management Services

Dir. Cesar G. dela Fuente III Dir. Araceli S. Soluta Energy Resource Development Bureau Financial Services

Dir. Mylene C. Capongcol Dir. Pacifico A. Avenido, Jr. Asst. Dir. Marissa P. Cerezo Administrative Services Renewable Energy Management Bureau Dir. Arthus T. Tenazas, CESO IV Dir. Mario C. Marasigan, CESO III Legal Services Asst. Dir. Irma C. Exconde Electric Power Industry Management Bureau Dir. Rino E. Abad SUPPORT OFFICES Asst. Dir. Rodela I. Romero Oil Industry Management Bureau Lisa S. Go Investment Promotion Office

Genesis A. Ramos FIELD OFFICES Consumer Welfare and Promotion Office Dir. Renante M. Sevilla (Luzon) Jive T. Bullock Public Affairs Office Dir. Ricardo B. dela Cruz (Visayas) Marian Maureen D. Obsena Dir. Nilo J. Geroche (Mindanao) Internal Audit Office

64 ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 Prepared by: Planning Division

In coordination with: Policy Formulation and Research Division Energy Cooperation and Coordination Division DOE Bureaus/Services/Offices DOE’s Attached Agencies

ENERGY SECTOR ACCOMPLISHMENT REPORT: 2019-2020 65