BRIEFING/ORIENTATION ON

By:
Mr. Leo S. Carias/Ms. Lenny B. Del Rosario
Rural Electrification Administration and Management
Division
Electric Power Industry Management Bureau
Department of Energy
 Legal & Operational Basis
Section 5 (i) R. A. No. 7638, “DOE Act of
1992”
Section 66 of R. A. No. 9136, “EPIRA of 2001”
 Attendant Rules and Procedures
Energy Regulations No. 1-94
Department Circular No. 95-11-009
Energy Regulations No. 1-94-A
Department Circular No. 96-08-009
Department Circular No. 98-05-007
Department Circular No. 98-11-010
Department Circular No. 2000-03-003
Department Circular No. 2000-10-011
Rule 29, Part A of EPIRA-IRR
Department Order No. 2002-06-007
 Policy Objectives

To recognize the contributions made by

the communities and people affected;
To lessen conflict of rights; and
To promote harmony and cooperation
among the LGUs/Region and the energy
resource developers and/or power
producers.

SEC. 5 (i), R.A. 7638

What is Energy Regulations No. 1-94?
It is the implementing rules and regulations
of Section 5 (i) of R. A. No. 7638, or the “DOE
Act of 1992”
Sec. 5(i) of R.A. 7638 provides,
That the Department shall ”devise ways and means of
giving direct benefits to the province, city, or municipality,
especially the community and people affected, and
equitable preferential benefit to the region that hosts the
energy resource and/or energy-generating facility:Provided,
however, that the other provinces, cities, municipalities, or
regions shall not be deprived of their energy requirements”.
Sec. 66 of R.A. 9136 provides,
That the provision of financial benefits to host
communities and the obligations of the power generating
facilities and/or energy resource developers as defined in
R.A. 7638 and its IRR shall continue.
ER 1-94 is part of the rate imposed on the electricity end-
users, duly approved by the ERC.
Who are the entitled to avail of this
benefit?

A local government unit (barangay,

municipality, city or province) where the
energy resource and/or energy
generating facility is physically located.
A region where the energy resource
and/or energy generating facility is
physically located.
EPIRA-IRR
What is the “obligation of the power
generating facilities and/or energy
resource developers to host
communities?”
The Generation Company and/or
energy resource developer should set
aside one centavo per kilowatt hour
(P0.01/kWh) of the total electricity
sales as financial benefits to host
communities.

SEC. 4, RULE 29 (A) EPIRA-IRR

 What agency will administer the
“P0.01/kWh financial benefits?”
The administration of EF, DLF, and RWMHEEF
shall be undertaken by the DOE.
Sec. 7 of EPIRA-IRR provides,
The administration of EF, DLF, RWMHEEF shall be undertaken by the
DOE. All funds administered by NPC with regard to DLF and RWMHEEF
shall be transferred to DOE for administration within 120 days from the
effectivity of these Rules.
Item 2.2.4 of the Joint DOF-DBM-COA Circular No. 1-97
Exempts from the coverage cash accounts owned by government-
owned and/or controlled corporations and local government units.

COA Decision No. 2002-240

The DOE is only allowed directly to apply the Trust and its income for
the purpose for which it was created.

SEC. 7, RULE 29 (A) EPIRA-IRR

How shall the P0.01/kWh financial benefits
be monitored?
Trust accounts shall be established specific
for EF, DLF, and RWMHEEF in the name of
DOE and the Generation Company.
Sec. 5 of the EPIRA-IRR provides,
The DOE shall establish trust accounts specific for EF,
DLF and RWMHEEF in the name of DOE and the Generation
Facilities or Generation Company and/or energy resource
developer.
Sec. 8(a) of the EPIRA-IRR provides,
The DOE shall review and audit the source of fund,
particularly on the total electricity sales of the Generation
Facility to determine the financial benefits due to the host
LGUs and host Regions.
SEC. 7, RULE 29 (A) EPIRA-IRR
 Establishment of Trust Accounts
GC and DOE GC
•Shall remit 31K to
•Shall enter into a DOE as Initial Deposit
MOA on the and Checkbook Fee
Establishment of EF, •Only 30K shall form
DLF, and RWMHEEF part of AFB

Actual
Generation GC DOE
Station Use
•Shall provide DOE
Systems Loss the Financial
Electricity Documents from •Shall inform the GC
Sales/kWh where the Electricity of the Account Name
Sales shall be And Number
Other Relevant
validated
Documents
 What are the nature of this P0.01
financial benefits?

Development
& Livelihood
Electrification
Reforestation,
Watershed
Management, Health
and/or Environment
Enhancement

SEC. 4, RULE 29 (A) EPIRA-IRR

 What is “radiating order of
application” on Electrification Fund
(EF)?
This means that the EF shall
be applied in the following
manner: Host Region/s

Designated resettlement area/s;

Host Province/s

Host barangay/s;
Host City/ies
Host municipality/ies of city/ies;
Host region/s Host Barangay/s

And other areas as maybe Resettlement Area/s

determined/prioritized by the DOE

 Non-Highly Urbanized Area
Allocation Scheme of Application Scheme for

P.01/kWh DLF & RWMHEEF

Resettleme
DLF nt
EF
Host Host
25% Baranga 5% Municipalit
y y
20% 35%
50%
25%

30% 10%
RWMHEEF Host
Provinc Host
e Region

Note: EF – Electrification Fund

DLF – Development and Livelihood Fund
RWMHEEF – Reforestation, Watershed Management,
Health and/or
Environment Enhancement Fund
Role of the CRO
 Designation of Community
Relations Officer (CRO)
♦Coordinate with the LGUs/Region on the preparation
of annual work program;
♦Assist in the preparation of all work
programs/project proposals prior to the release of project
fund/s;
♦Monitor and report to DOE the implementation/status
of work program/project implementation;
♦Shall provide the LGUs/Region updated status of
accrued financial benefits;
♦Act as liaison officer to all concerned government
agencies relative to project implementation.
DC 2000-03-003
Allpower producer and/or energy resource developer is hereby required to
designate one ComRel for each power plant.

SEC. 6a, RULE 29 (A) EPIRA-IRR

 Process of Availment - EF
Case 1 DU DOE

•Evaluates/Process
•Submits proposal/s proposal/s
•Implements the •Releases Fund
project •Audits disbursement
•Inspects project
Case 2

HOST LGU/PP DU DOE

•Evaluates/Process
Submits project •Reviews/submits proposal/s
proposal/s proposal/s •Releases Fund
•Implements project •Audits disbursement
•Inspects project

Note: * MOA is entered into by and between the DOE and FDU
* The project fund to be released shall be based on the result
of
public bidding/canvass by FDU
* All project funds shall be subject to liquidation prior to the
approval
 Process of Availment on DLF &
REFOproject proposal/s duly
The Host Communities submits
supported by a Resolution from the Sanggunian with
the necessary documents and endorsed by the Power
Plant and/or energy resource developer to DOE for
evaluation/approval.
HOST LGU/Region Power Plant DOE

•Evaluates proposal/s •Process proposal/s

•Coordinates with •Forges MOA with the
Submits project
the LGUs & Region/s LGUs/Region & P/P
proposal/s
•Endorses proposal •Facilitates release
to DOE of project fund

Note: * MOA is entered into by and among the DOE, P/P,

and LGU/Region
* The project fund to be released shall be based on
the result of
public bidding/canvass (under R.A. 9184)
* All project funds shall be subject to liquidation
prior to the approval
 Approval of Proposal
and Release of Project
Fund
 Approving Authority
Previous
Procedure
On the approval of project proposal and
approval on the release of project fund are
classified according to project cost:
P1M and below = Bureau
Director
P1M > P5M =
Undersecretary
P5M and above = Secretary
DOE 2002-06-007 “MEASURES ADOPTED TO REDUCE RED TAPE IN THE DEPARTMENT
OF ENERGY”
 Approving Authority
Current
Procedure
Approval of project proposal
regardless of amount shall be
undertaken by the Office of
the Secretary
MEMORANDUM FROM THE SECRETARY DATED AUGUST 29, 2007 “SIGNING OF
CONTRACTS, MEMORANDA OF AGREEMENT/UNDERSTANDING, PERMITS, DEEDS,
ETC.”
 Approving Authority
Current
Procedure
On the release of project fund, the level of
approval are as follows:

AMOUNT Recommending Official Approving Authority

P5.0M and above Concerned Usec. Secretary

P3.0M -below P5.0M Concerned A.Sec Sr. Undersecretary
Concerned Bu
P1.0M -below P3.0M Dir/Service Dir Concerned Usec.
Concerned Div. Chief
Below P1.0M Concerned
Bureau/Service Dir
MEMORANDUM FROM USEC. KYAMKO DATED 16 JULY 2008 “DELEGATION OF
AUTHORITY”
 Release of Project Fund to LGUs/RDC
(DOE
Administered Funds of IPPs)
DOE LGUs/RDC DOE

Informs project Submits bid result Facilitates

Proponent on the & supporting remittance of
approval of documents project fund directly
proposal thru NTP as a basis for the to LGUs account as
release of provided in the MOA
project fund

DOE/COA
LGUs/RDC
•LGUs Resident COA
audits utilization
of funds
•DOE-IAS validates Implements
disbursements the project
•DOE-REAMD conducts
Technical inspection
Release of Project Fund to LGUs/RDC
(NPC-Administered Funds of NPC
IPPs)
DOE LGUs/RDC DOE
Submits bid result Facilitates
•Informs project
& supporting remittance of
proponent on
documents project fund directly
the approval of
as a basis for the to LGUs account as
proposal thru
release of provided in the MOA
NTP
project fund
•Notifies NPC
to remit the
project fund
directly to DOE
DOE/COA
LGUs/RDC
•LGUs Resident COA
audits utilization
of funds
•DOE-IAS validates Implements
disbursements the project
•DOE-REAMD conducts
Technical inspection
 Criteria on Projects to be
Funded under DLF & REFO

Availability of Funds
Has the capacity to increase income levels
and generate employment opportunities
Uplift the living condition of the beneficiaries
 No adverse environmental effects
Promote a more equitable share of benefits
 Demonstrate the capacity for effective and
successful implementation
ER 1-94 UPDATES
 ER 1-94 UPDATES
Generating Facilities
Nationwide
Incorporated in E.R. 1-94 Program
(As of 06 July 2009)
Total 136
Establishment of 14
NPC 36 Trust Accounts (on-
going)
IPPs 88 Active 76
Joint NPC and PNOC-EDC 12 Inactive 57
(incl. CALENERGY BOT w/
PNOC-EDC)

Note:
NPC – National Power Corporation
IPPs – Independent Power Producers
PNOC-EDC – PNOC Energy Dev’t Corp.
CALENERGY – California Energy Int’l ltd
 ER 1-94 UPDATES
Host Communities
Incorporated in E.R. 1-94 Program
( As of 06 July 2009 )

Total 680
NPC Owned Facilities 481*
Joint NPC-PNOC-EDC Facilities 34
IPP Facilities 165
*AGUS 1, 2, 4, 5, 6, 7 HEPs (300) Facilities Resources
Barangays 30 242
Municipalities/Cities 5 19
Provinces 2
Regions 2
 ER 1-94 UPDATES

Trust Accounts Established

(As of 06 July 2009)

Total 384
DOE Administered Trust Accounts 346
(Land Bank of the Phils.) 279

(Dev’t. Bank of the Phils.) 67

NPC Administered Trust Accounts* 38

Note:
* The DLF and RWMHEEF are still with NPC but subject for transfer of administration to DOE
pursuant to Section 7, Part A, Rule 29 of EPIRA-IRR
 ER 1-94 UPDATES
Summary of Approved Projects
( As of 06 July 2009 )
Total Type of Project (PhP)
No. of Billion
Projects
2,018 Electrification* 1.70

980 Development and Livelihood 0.83

845 Reforestation, Watershed Management, 1.02
Health and/or Environment Enhancement

Note: * Excluding MIRANT, SARO, KEPHILCO & PNOC-EDC Projects a

among other advanced financial assistance
TYPES OF PROJECTS
What are the specific types of projects
being funded under EF, DLF, and
RWMHEEF?

Electrification Projects (funded under EF)

♦ Missionary Electrification Projects

- Extension/expansion of
distribution lines
-Upgrading of distribution lines
What are the specific types of projects
being funded under EF, DLF, and RWMHEEF?
Development Projects
(funded under DLF)

♦Streetlighting ♦Fish ports

♦Farm to Market Road
♦Multi-Purpose Pavement
♦Farm produce collection &
buying station
♦Rice/Corn Milling
♦Communal Irrigation
System
♦Small water impounding
Projects
♦Seawalls
♦Day Care Center
♦School Building
♦Public market
♦Slaughter house
♦Bridge
♦Flood control measures
♦Public drainage/sewerage
♦system
What are the specific types of projects
being funded under EF, DLF, and RWMHEEF?
Development Projects
(funded under DLF)

♦Streetlighting ♦Fish ports

♦Farm to Market Road
♦Multi-Purpose Pavement
♦Farm produce collection &
buying station
♦Rice/Corn Milling
♦Communal Irrigation
System
♦Small water impounding
Projects
♦Seawalls
♦Day Care Center
♦School Building
♦Public market
♦Slaughter house
♦Bridge
♦Flood control measures
♦Public drainage/sewerage
♦system
What are the specific types of projects
being funded under EF, DLF, and RWMHEEF?
Reforestation, Watershed Management, Health and/or
Environment Enhancement Projects
(funded under RWMHEEF or REFO)
ENVIRONMENT ENHANCEMENT PROJECTS

♦Fire Truck ♦Waste Management

♦Garbage/Dump Truck Equipment:
♦Sanitary Landfill Garbage Truck
Development of MRF Dumptruck
♦Construction of Concrete Bulldozer
Sanitary Waste Water Buckhoe / Loader
Collection Facility
 What are the specific types of projects
being funded under EF, DLF, and RWMHEEF?
Reforestation, Watershed Management, Health and/or
Environment Enhancement Projects
(funded under RWMHEEF or REFO)
HEALTH RELATED REFORESTATION, WATERSHED
PROJECTS MANAGEMENT RELATED
PROJECTS
♦Water supply system ♦Improvement of forest cover
♦Municipal Hospital ♦Vengineering measures
♦Health Center ♦Community-based forestry
♦Medical equipment/facilities management
♦Medicinal plant gardens ♦Agro-forestry
♦Ambulance ♦Conservation of Mangroves
♦Seedling nursery
 INTEGRATED
INTEGRATED&
&SUSTAINABLE
SUSTAINABLE PROGRAM
PROGRAMAPPROACH
APPROACH
UNDER
UNDER E.R.
E.R.11--94
94
DOE
OTHER
OTHER GOVERNMENT
GOVERNMENT AGENCIES
AGENCIES NPC/PNOC/
IPP
INTEGRATED/WHOLISTIC &
SUSTAINABLE APPROACH
FINANCIAL
BENEFITS
(EF, DLF, ELECTRICITY
RWMHEEF) OTHER
SUPPORT
PROGRAM SERVICES
MONITORING AND LIVELIHOOD
EVALUATION
DENR/DOH/DA/DPWH/DSWD/DECS CAPABLE GROUP

LGU & CRO INFRASTRUCTURE

TECHNICAL
ASSISTANCE /
CONSULTANCY &
COORDINATION/ 1. PLANNING: PROJECT ID,
PARTNERSHIP PRIORITIZATION, CONSULTATION,
PROPOSAL PREP.; 2. IMPLEMENTATION;
MONITORING & EVALUATION.
Maraming Salamat Po!