CASELYN ANNE C. ALOTA

YOUTH CONGRESS

 (PUP)

4^TH CONGRESS

 

By Caselyn Anne C. Alota

 

 

AN ACT PROMOTING THE USE OF RENEWABLE ENERGY AS AN ALTERNATIVE RESOURCE IN GENERATING ELECTRICITY ON VARIOUS LOCAL OR PROVICIAL AREAS WHILE USING APPROPRIATE AND ADVANCED TECHNOLOGY TO AVOID ENVIRONMENTAL DAMAGES

 

 

Chapter I. Title and Declaration of Policies

 

Section 1. Title – This act shall be called “An Act of using Renewable Energy Resource as a substitute in generating Electricity”. It is therefore after be referred to as the Act.

 

Section 2. Declaration of Policies – This Act shall declare the following policies:

(a)                         Enhance intensive researches on the development of different renewable energy resources, such as but not limited to, biomass energy, geothermal energy, hydropower energy, solar energy, wind energy and ocean energy or the hybrid energy systems to fully understand their function, their benefits and disadvantages, and their proper application in our country’s system on distribution of electricity.

(b)                         Explore the applicability and serviceability of specific renewable energy resources on their appropriate local or provincial areas as a substitute from expensive fossil fuels in generating electricity.

(c)                         Encourage the use of renewable energy as a substitute – from fossil fuels – in various local or provincial areas to minimize the use of fossil fuels that emits harmful gases which can cause negative effects to humans and to the environment, also, it reduces the cost of importing fossil fuels.

(d)                        Organize necessary research on the appropriate technology that shall ensure the public of safe and proper application of renewable resources ingenerating electricity to some local or provincial areas.

(e)                         Formulate strategies and methods to improve the effectiveness of this Act.

 

Section 3. Scope – this Act shall create a structure that shall embody a system that aims on the improvement of utilization and application of renewable energy resources in the appropriate local or provincial areas while using advanced technology to avoid negative environmental effects.

 

Section 4. Definition of Terms – As used in this Act, the following terms are herein defined:

(a)        “Alternative energy resources” refers to energy resources that are non-fossil fuel based, including biomass resources, geothermal energy systems, hydropower energy systems, solar energy systems, wind energy systems and ocean energy systems or the hybrid energy systems  and other emerging energy sources using technologies.

(b)        “Biomass energy systems” refers to energy systems which use biomass resources to produce heat, steam, mechanical power or electricity through either thermochemical, biochemical or physico-chemical processes.

(c)        “Biomass resources” refers to natural or processed plants and plant materials, trees, crop residues, wood and bark residues, and animal manure or any organic or biodegradable matter that can be used in bioconversion process.

(d)       “Department of Energy” or “DOE” refers to the government agency created pursuant to Republic Act No. 7638 whose functions were expanded in Republic Act No. 9136 and further expanded in this Act.

(e)        “Department of Environment and Natural Resources” or “DENR” refers to the government agency created pursuant to Executive Order No. 192.

(f)        “Department of Finance” or “DOF” refers to the government agency created pursuant to Executive Order No. 127, as amended.

(g)        “Department of Science and Technology” or “DOST” refers to the government agency created pursuant to Executive Order No. 128.

(h)        “Distribution of electricity” refers to the conveyance of electric power by a Distribution Utility through its distribution system pursuant to the provision of Republic Act No. 9136 and its implementing rules and regulations (IRRs).

(i)         “Energy Regulatory Commission” or “ERC” refers to the independent quasi-judicial regulatory agency created pursuant to Republic Act No. 9136.

(j)         “Grid” refers to the high voltage backbone system of interconnected transmission lines, substations and related facilities, located in each of Luzon, Visayas and Mindanao, or as may otherwise be determined by the ERC in accordance with the IRR of Republic Act No. 9136.

(k)        “Hybrid system” refers to any power or energy generation facility which makes use of two or more types of technologies utilizing both conventional and/or renewable fuel sources such as, but not limited to, integrated wind/diesel systems, integrated solar/wind systems, biomass/fossil fuel systems, hydro/fossil fuel systems, integrated solar/biomass systems, integrated wind/fossil fuel systems, with a minimum 1 of ten (10) megawatts or ten percent (10%) of the annual energy output provided by the Renewable Energy Systems (RES) components of the hybrid systems, whichever is lower.

(l)         “Hydroelectric power systems” or “Hydropower systems” refers to water-based energy systems which produce electricity by utilizing the kinetic energy of falling or running water to turn a turbine generator.

(m)       “Net metering” refers to a system, appropriate for distributed generation, in which a distribution grid user has a two-way connection to the grid and is only charged for his net electricity consumption and is credited for any overall contribution to the electricity grid.

(n)        “Ocean energy systems” refers to energy systems which convert ocean or tidal current, ocean thermal gradient or wave energy into electrical or mechanical energy.

(o)        “Off-grid systems” refers to electrical systems not connected to the wires and related facilities of any Mini-Grid System or the On-Grid Systems of the Philippines.

(p)        “On-grid system” refers to electrical systems composed of interconnected transmission lines, distribution lines, substations and related facilities for the purpose of conveyance of bulk power on the Grid of the Philippines.

(q)        “Renewable energy resources” or “RE Resources” refers to energy resources that do not have an upper limit on the total quantity to be used. Such resources are renewable on a regular basis, and whose renewal rate is relatively rapid to consider availability over an indefinite period of time. These include, among others, solar, wind, hydropower, geothermal and ocean energy.

(r)        “Renewable Energy Systems” or “RES” refers to energy systems which convert renewable energy resources into useful energy forms, like electrical, mechanical, etc.

(s)        “Solar energy” refers to the energy derived from solar radiation that can be converted into useful thermal or electrical energy.

(t) “Solar energy systems” refers to energy 1 systems which convert solar energy into thermal or electrical energy

(u) “Small Power Utilities Group” or “SPUG” refers to the functional unit of the NPC mandated under Republic Act No. 9136 to pursue missionary electrification function.

(v)        “Wind energy” refers to the energy that can be derived from wind that is converted into useful electrical or mechanical energy.

(w)       “Wind energy systems” refers to the machines or other related equipment that convert wind energy into useful electrical or mechanical energy.

(x)        “Wholesale Electricity Spot Market” or “WESM” refers to the wholesale electricity spot market created pursuant to Republic Act No. 9136.

 

 

Section 5. Lead Agency – The DOE shall be given the authority on the implementation of this Act.

 

 

CHAPTER III. ON-GRID CLEAN, RENEWABLE AND ALTERNATIVE ENERGY DEVELOPMENT

 

 

Section 6. Renewable Portfolio Standard (RPS). – All stakeholders in the electric power industry shall contribute to the growth of the renewable energy market of the country. Towards this end, the National Clean, Renewable and Alternative Energy Board (NCRAEB) created under Section 13 of this act, shall set the minimum

percentage of generation from eligible renewable energy resources and

determine to which sector RPS shall be imposed on a per grid basis within two

(2) years from the effectivity of this Act.

The ERC shall determine and formulate rationalized tariff for all

eligible RE resources to be used in complying with the requirement under the

RPS. The ERC, if recommended by the National Clean, Renewable and Alternative Energy Board (NCRAEB

created under this Act, may promulgate a feed-in tariff system which shall

include the determination of a fixed tariff to be paid for electricity from each

type of renewable energy and the mandated number of years. As used in this

Act, feed-in tariff refers to a tariff mechanism applied to renewable energy

generations used in complying with the Renewable Portfolio Standards, that

involves a fixed guaranteed price for each renewable energy system and/or

technology over a period of at least fifteen (15) years, and shall be set at a higher

price per kilowatt-hour than the grid price and finally, to be passed on directly

to electricity consumers except the lifeline rate consumers.

Thereafter, the ERC shall, in consultation with the sector concerned, set

the minimum increase per year but shall, in no case, be less than one percent

1 %per year over the next fifteen (15) years.

The mandate may be complied with by either directly generating from renewable sources, contracting for energy sourced from renewable energy facilities or trading for Renewable Energy in the Wholesale Electricity Spot Market (WESM).

 

Section 7. Renewable Energy Market (REM). – To facilitate compliance

with the provisions of Section 6 of this Act, the DOE shall, in coordination

with the NREB, after due hearing, promulgate the rules for the establishment

and operation of a REM, as a sub-market under the WESM.

 

Section. 8. Green Energy Option. – A Green Energy Option program shall

provide end users the option to choose renewable energy resources.

Upon the determination of the DOE of its technical viability, end users

with a monthly average peak demand of at least 100 kW may directly contract for RE-based energy.

Consistent herewith, the NCAEB shall prescribe to the appropriate or

relevant entities to provide the appropriate mechanisms for the physical

connection and commercial arrangements necessary to ensure the success of

the Green Energy Option.

 

Section. 9. Net-metering and Distributed Generation for Renewable

Energy. – The DOE shall, upon request and subject to technical considerations

and without discrimination, authorize the distribution utilities to enter into net metering

agreements with qualified end users up to a distributed generation

market share of one percent (1%) of peak distribution grid demand.

To qualify, the power that an end user must generate from renewable

sources shall be less than 100 kW in peak capacity, and shall meet any specific

regulation, which may be issued by the DOE, in consultation with the electric

power industry participants, within one (1) year from the effectivity of this Act.

The distribution utility shall charge qualified users their net energy

consumption at the standard retail rate and shall credit net contributors of

energy from renewable sources at the prevailing average bulk generation rate.

The distribution utility shall be entitled to any renewable energy

production certificate resulting from distributed RE generation for sale or use

in the RPS.

Consistent herewith, the DOE shall mandate all relevant parties to

provide the mechanisms for the physical connection and commercial

arrangements necessary to ensure the success of the Net-metering and

Distributed Generation for Renewable Energy program.

 

CHAPTER IV. OFF-GRID RENEWABLE ENERGY DEVELOPMENT

 

Section 10. Off-Grid Areas. – In the performance of its mandate to

provide missionary electrification, the SPUG, successors-in-interest and/or

qualified third party in off-grid areas shall, within two (2) years from the

effectivity of this Act, source a minimum percentage of its total annual

generation from available RE resources in the area concerned, as may be

determined by the DOE through its Renewable Energy Policy Framework.

 

CHAPTER V. GOVERNMENT SHARE

 

Section. 11. Government Share. – The government share on RE

development projects shall be at least one and one-half percent (1.5%) of the

gross proceeds for all RE resources except for indigenous geothermal energy,

which shall be at two percent (2%) of the gross proceeds.

 

CHAPTER VI. ENVIRONMENTAL COMPLIANCE

 

Section. 12. Compliance with Environmental Regulations. – All renewable

energy explorations, development, utilization and RE operations shall be

conducted in accordance with existing environmental regulations as prescribed

by the DENR and/or any other government agency.

The use of technology in improving the development of renewable resources for the utilization on various local or provincial areas.

 

CHAPTER VIII. GENERAL PROVISIONS

 

Section 13.  Creation of the National Clean, Renewable and Alternative Energy Board (NCRAEB). – The National Clean, Renewable and Alternative Energy Board is hereby created. It shall be composed of the Secretary of the DOE or his designated undersecretary as chairman and the secretaries or the

designated undersecretaries or assistant secretaries of the DTI, the DOF and the DENR; the presidents or the duly designated representatives of the NPC, the TRANSCO, and the PEMC; and one representative each from the clean,renewable and alternative energy developers, government financial institutions (GFIs), and nongovernmental organizations (NGOs), duly endorsed by their respective industry associations and appointed by the President of the Republic

of the Philippines, as members. The DOE Secretary or his designated undersecretary, in his capacity as Chairman, shall, within one month from the effectivity of this Act, convene the NCRAEB. The NCRAEB shall be assisted by a Technical Secretariat from the Energy Utilization Management Bureau of the DOE, thru the Renewable Energy Management Division and the DOE-natural gas office shall directly report to the Office of the Secretary or the undersecretary of the Department, as the case may be, on matters pertaining to the activities of the NCRAEB. The number of staff of the Technical Secretariat and the creation of corresponding

positions necessary, to complement and/or augment the existing plantilla of the Renewable Energy Management Division and the DOE-natural gas office shall be determined by the Board, subject to approval by the Department of Budget and Management (DBM) and existing civil service rules and regulations. The NCRAEB shall have the following powers and functions:

(a)        Approve the National Clean, Renewable and Alternative Energy Program, as formulated by the DOE;

(b         Set the mandated Renewable Portfolio Standards, as it deems appropriate;

(c)        Recommend specific actions in facilitating the implementation of the National Clean, Renewable and Alternative Energy Program to be executed by the DOE and other appropriate agencies of government;

(d)       Monitor and review the implementation of the National Clean, Renewable and Alternative Energy Program, including the compliance with the Renewable Portfolio Standards and minimum RE generation capacities in off grid areas;

(e)        Oversee and monitor the collection and utilization of the Clean, Renewable and Alternative Energy Trust Fund as administered by the Department; and

(f)        Perform such other functions, as may be necessary, for the effective implementation of this Act.

 

Section 14. Financial Assistance Program. – Government financial institutions such as the Development Bank of the Philippines (DBP), the Land Bank of the Philippines (LBP), the Phil-Exim Bank and other government financial institutions shall, in accordance with and to the extent allowed by the enabling provisions of their respective charters or applicable laws, provide preferential packages for the development, utilization and commercialization of RE projects as duly recommended and endorsed by the DOE.

 

Section 15. Adoption of Technologies. – The DOE shall, where practicable, encourage the adoption of waste-to-energy facilities such as, but not limited to, biogas systems. The DOE shall, in coordination with existing private companies and suppliers, facilitate the provision of technical assistance, in the adoption of the technology

 

 

CHAPTER IX. FINAL PROVISIONS

 

Section 16. Implementing Rules and Regulations (IRR). – Within six (6)

months from the effectivity of this Act, the DOE shall, in consultation with the and other relevant government entities and RE developers, promulgate the

IRR of this Act.

 

Section 17. Penalty Clause. – Any person found in violation, through an

act of commission or omission of the provisions of this Act or the

implementing rules and regulations of this Act shall, upon conviction, be

punished by a fine of not less than One hundred thousand pesos (P100,000.00)

or by imprisonment of not less than two (2) years but not more than five (5)

years, or both, at the discretion of the court.

In case of violations committed by a juridical entity, the penalty

provided shall be imposed on the official or employee responsible therefor:

Provided, That if the violation is committed by a government official or

employee, he/she shall, in addition to the promulgated penalties provided

herein, be subject to disciplinary administrative proceedings and penalties.

 

Section. 29. Effectivity Clause. – This Act shall take effect ten  (10)

days after its complete publication in at least two (2) newspapers of general

circulation.