Energy Reform Agenda

Energy Access for More A key priority of government to mainstream access of the greater majority to reliable energy services and fuel, most importantly, local productivity and countryside development

Good Governance thru stakeholder participation, transparency, multi-sectoral partnership and use of ICT

Ensure E Energy Security

Achieve Optimal Energy Pricing

Develop a D l Sustainable Energy Plan

Pillar I: Ensuring Energy Security g gy y

ACTION PLANS STRATEGIC DIRECTION Accelerate the exploration and development of oil, oil gas and coal resources Short-term (2010-2011) (2010 2011) Operationalize a one-stopshop for upstream investment promotion and assistance Award of exploration and development contracts for petroleum o Energy Contracting Round o Direct negotiations for Frontier Areas o Publication of nominated areas Collection and reporting of complete, complete accurate and timely oil and gas data through the International Joint Oil Data Initiative (JODI). Prudent assessment of current Service C t S i Contracts. t Medium-term (2011-2013) (2011 2013) Continue awarding of exploration and development contracts for coal and petroleum to identify /firm up reserves and complement fuel supply o Energy Contracting Round o Direct negotiations for Frontier Areas o Publication of nominated areas Conduct of research on new technologies on hydrocarbon (i.e. CBM, EOR/IOR/CCS) Long-term (2013-2016) (2013 2016) Sustain promotion and implementation of upstream activities

Pillar I: Ensuring Energy Security g gy y

STRATEGIC DIRECTION
Intensify development and utilization of renewable rene able and environmentfriendly alternative energy resources/ technologies

ACTION PLANS
Short-term (2010-2011) (2010 2011)
Increase utilization of biofuels Increase domestic bioethanol production capacity to 64 million liters Increase use of locallyproduced alternative fuels/biofuels Conduct Cond ct R&D for other nonnon food feedstock in coordination with concerned agencies, academe & research institutions. Implement higher biofuels blend from B2 to B5 and E10 to all gasoline and corresponding standards Identify and promote the required infrastructure and logistics facilities to support biofuels program

Medium-term (2011-2013) (2011 2013)

Increase utilization of biofuels Additional bioethanol capacity of 100 million liters Continue conduct of R&D for other non-food feedstock in coordination with concerned agencies, academe & research institutions. Conduct feasibility study of biofuels and blends for air transport

Long-term (2013-2016) (2013 2016)

Increase utilization of biofuels Continue conduct of R&D for other non food non-food feedstock in coordination with concerned agencies, academe & research institutions. Continue conduct feasibility of biofuels and blends for other modes of transport. Implement biofuels blend beyond B5 and E10 and corresponding standards

Pillar I: Ensuring Energy Security g gy y

STRATEGIC DIRECTION
Intensify development and utilization of renewable and environmentfriendly alternative energy resources/ technologies

ACTION PLANS
Short-term (2010-2011) (2010 2011)
Continuously promote the use of other alternative fuels (i.e. compressed natural gas, auto liquefied petroleum gas) as well as other emerging energy technologies such as electric vehicles in the transport sector.

Medium-term (2011-2013) (2011 2013)

Continuously promote the use of alternative fuels (i.e. compressed natural gas, auto liquefied petroleum gas) and other emerging energy technologies

Long-term (2013-2016) (2013 2016)

Continuously promote the use of alternative fuels (i.e. compressed natural gas, auto liquefied petroleum gas) and other emerging energy technologies Expand the use of natural gas to all sectors by putting up natural gas infrastructure in NCR and CALABARZON.

Pillar I: Ensuring Energy Security

STRATEGIC DIRECTION
Intensify development and utilization of renewable and environmentfriendly alternative energy resources/ technologies

ACTION PLANS
Short-term (2010-2011)
Increase RE-based generation capacities Finalize all policy mechanisms and guidelines under Renewable E R bl Energy A t of Act f 2008. oRenewable Portfolio Standard (RPS) oFeed-in-Tariff oFeed in Tariff (FiT) oNet-metering oGreen Energy Option (GEO) oRE Market (REM)/Registrar Conduct C d t RE resource assessment to determine potential sites for capacity addition Conduct Open and Competitive Selection Process (OCSP) of awarding RE Service Contracts

Medium-term (2011-2013)
Increase RE-based generation capacities Continuing conduct of RE resource assessment to increase potential sites for capacity addition Continuing conduct of Open and Competitive Selection Process (OCSP) of awarding RE Service Contracts Convert RE Service Contract (Pre(Pre development to commercial stage) -- Wind (103 sites) -- Solar (4 sites) -- G th Geothermall (21 sites) -- Hydro (392 sites)

Long-term (2013-2016)
Increase RE-based generation capacities Continuing conduct of RE resource assessment to i t increase potentiall t ti sites for capacity addition Continuing conduct of Open and Competitive p p Selection Process (OCSP) of awarding RE Service Contracts Convert RE Service Contract (Pre (Predevelopment to commercial stage) -- Wind (103 sites) -- Solar (4 sites) -- Geothermal (21 sites) -- Hydro (392 sites)

Pillar I: Ensuring Energy Security g gy y

STRATEGIC DIRECTION
Enhance energy efficiency and conservation

ACTION PLANS
Short-term (2010-2011) (2010 2011)
Achieve energy efficiency lighting system market transformation p y Rationalize public utility vehicles in major roads, particularly EDSA. Promote energy efficient lighting technologies (Philippine Energy Efficiency Project) Monitor the implementation of Administrative Order 126, requiring government buildings to reduce electricity and fuel consumption by 10%.

Medium-term (2011-2013) (2011 2013)

Promote the green building rating system Promote adoption of Energy Management Standard St d d iin industries under ISO 50001 framework.

Long-term (2013-2016) (2013 2016)

Pillar I: Ensuring Energy Security g gy y

STRATEGIC DIRECTION
Enhance energy efficiency and conservation

ACTION PLANS
Short-term (2010-2011) (2010 2011)
Conduct energy audit of DOE attached agencies. g gy Promote and strengthen Energy Service Companies Establish energy benchmark in the manufacturing and building sector. Explore market transformation towards energy efficiency for refrigerators and air-conditioners. p g Expand the coverage of the Energy Labeling Program.

Medium-term (2011-2013) (2011 2013)

Long-term (2013-2016) (2013 2016)

Pillar I: Ensuring Energy Security g gy y

STRATEGIC DIRECTION
Put in place reliable power supply

ACTION PLANS
Short-term (2010-2011) (2010 2011)
Address pricing and non-pricing (competitive and regulatory) issues to encourage investment Increase demand-side participation More efficient use of electricity through DSM Develop policy framework for distributed generation projects Tap embedded generators to augment power supply Participation of ECs in SPUG areas

Medium-term (2011-2013) (2011 2013)

Long-term (2013-2016) (2013 2016)

Implement WESM in Mindanao

Pillar I: Ensuring Energy Security g gy y

STRATEGIC DIRECTION
Put in place reliable power supply

ACTION PLANS
Short-term (2010-2011) (2010 2011)
Update Power Supply Contingency Plan o Interim policy on the unprivatized assets for contingency purposes o Re-commission power plants under preservation (e.g. Sucat, Duracom, Power Barge/Navotas) o Transfer PB 101,102 and 103 to 101 102 Mindanao once CEDC, PEDC and KEPCO power plants in the Visayas are fully operational Initiate the upgrade/rehabilitation of NPC plants Implement heat rate improvement in power plants

Medium-term (2011-2013) (2011 2013)

Pursue the development of non-power hydro projects in Mindanao

Long-term (2013-2016) (2013 2016)

Pillar I: Ensuring Energy Security g gy y

STRATEGIC DIRECTION Put in place reliable p power supply pp y

ACTION PLANS
Short-term (2010-2011) (2010 2011) Establish and strictly monitor industry compliance to reliability standards o Develop monitoring and disclosures p g on status of generating facilities o Reduce the forced outages rate of generating units o Enforce strict compliance of p p power plants with their annual preventive maintenance program Rationalize NPC Supply Contract Undertake preparatory activities to determine readiness to open access Medium-term (2011-2013) (2011 2013) Create an Independent Reliability y Council Implement Open Access Implement p prepaid metering Long-term (2013-2016) (2013 2016)

Pillar I: Ensuring Energy Security

STRATEGIC DIRECTION
Attain nationwide electrification (Implement 90 percent household connection)

ACTION PLANS
Short-term (2010-2011)
Pursue Sitio Energization Program ongrid energization of 2,466 Sitios Energize 4,000 Households using RE system

Medium-term (2011-2013)
On-grid energization of 17,287 sitios Energize 4,000 Households using RE systems

Long-term (2013-2016)
On-grid energization of 13,637 Sitios Energize 4,000 Households using RE system

Improve transmission and distribution systems

Undertake the Leyte-Mindanao interconnection project Consider extending the 500-kV transmission backbone to Western Luzon and looping it with Southern Luzon via Kadampat Hermosa Zapote Dasmarinas corridor Pursue ASEAN Power Grid Interconnection

Pillar I: Ensuring Energy Security g gy y

STRATEGIC DIRECTION
Ensure industry compliance to quality standards for products and facilities

ACTION PLANS
Short-term (2010-2011)
Operationalize marker technology to address smuggling Expedite procurement and operation of mobile testing laboratory Expedite procurement of LPG testing equipment Strictly enforce importation rules

Medium-term (2011-2013)

Long-term g (2013-2016)

Pillar I: Ensuring Energy Security

STRATEGIC DIRECTION
Promote Oil Supply Security

ACTION PLANS
Short-term (2010-2011)
Update oil supply contingency plan o Develop emergency response mechanism to respond to local oil supply disruptions Improve guidelines to encourage competition (e.g. GSTLF, operation permits) Clarify taxation on imported vs. locally refined petroleum products (jet fuel, intermediate products)

Medium-term (2011-2013)
Develop/establish strategic oil stockpile. Provide additional oil distribution infrastructure. Expand/upgrade oil refineries

Long-term (2013-2016)

Provide climate conducive to investments and fair and orderly competition (to expand local refining/storage /handling/distrib ution capability)

Pillar II: Achieving Optimal Energy Pricing

STRATEGIC DIRECTION
Develop/ Institute optimal price setting in the energy and power industries

ACTION PLANS
Short-term (2010-2011) (2010 2011)
Upstream/Downstream Develop a framework for the pricing of indigenous energy - Implement capacity building to institute framework Review tax issues affecting energy prices (e.g. VAT, real estate, local taxes) Review incentives in the upstream sector

Medium-term (2011-2013) (2011 2013)

Upstream Develop methodology for the pricing of indigenous energy sources.

Long-term (2013-2016) (2013 2016)

Pillar II: Achieving Optimal Energy Pricing

ACTION PLANS STRATEGIC DIRECTION Short-term (2010-2011) (2010 2011)
Power Revisit fuel supply contracts in the upstream e.g. naturall gas which is benchmarked with t hi h i b h k d ith international prices of oil. Resolve imposition of VAT to power rates including the impact of the LGU Code to the existing and future operations and projects of the power stakeholders. Revisit the EPIRA provisions on : - Lifeline rates - Mandated Rate Reduction - Loan Condonation - Cross-subsidy removal Coordinate with DILG to implement DILG-DOE Joint Circular 95-01 on the use of the National Wealth Tax Review power supply contracting/power purchasing practices of distribution utilities.

Medium-term (2011-2013) (2011 2013)

Power Establish Reserve Market R M k t Implement of Open Access and Retail Competition Standardization of bilateral contracts

Long-term (2013(2013 2016)

Pillar II: Achieving Optimal Energy Pricing

STRATEGIC DIRECTION

ACTION PLANS
Short-term (2010-2011) (2010 2011)
Power Review and validate the operation of distribution utilities and NGCP vis--vis the applicable rate methodology being adopted. Monitor compliance of NGCP to the terms and conditions of its Concession Agreement Implement Time of Use Rates and Demand Side Management (DSM) Program at the distribution level. Monitor and enforce market share cap for generators. Review NPC s existing Special Rates to various NPCs customers. Revisit privatization program of PSALM. Strengthen monitoring and enforcement of rules on anti-competitive behavior and unfair trade practices.

Medium-term (2011-2013) (2011 2013)

Long-term (2013-2016) (2013 2016)

Pillar II: Achieving Optimal Energy Pricing

STRATEGIC DIRECTION

ACTION PLANS
Short-term ( (2010-2011) )
Power Provide regulatory certainties to investors e.g. timeliness and appropriateness of rate approvals. Upgrade PEMC facilities (hardware and software). Upgrade and improve NGCPs transmission line facilities and DU distribution lines . Strictly enforce WESM Rules e.g. Real-time dispatch. Launch WESM in the Visayas Monitor technical regulation of players in the power sector (referring to standards in subt ( f i t t d d i b station)

Mediumterm (2011-2013)

Long-term ( (2013-2016) )

Promote transparency of oil prices

Downstream Oil Review oil price formulas and methodologies - Improve transparency of pricing (basis, methodology, among others)

Pillar II: Achieving Optimal Energy Pricing

STRATEGIC DIRECTION

ACTION PLANS
Short-term (2010-2011)
Downstream Oil Resolve taxation issues (DOF/BIR/BOC) e.g. duty, excise, VAT on petroleum g y, , p products (finished and intermediate), the biofuel chain, imported ethanol, real estate tax per BOI incentives Advocate passage of Competition/AntiTrust Law Mitigate impact of high oil prices Minimize economic leakage on the oil and public transport sectors

Medium-term (2011-2013)

Long-term (2013-2016)

Pillar III: Develop a Sustainable Energy Plan

STRATEGIC DIRECTION
Pursue E P Energy Legislative Agenda

ACTION PLANS
Short-term (2010-2011)
R Recommend to OP and Congress dt dC the certification of Energy Bills as Urgent legislative measures: - Energy Efficiency &Conservation - LPG Bill - Natural Gas Bill - Amendments to EPIRA, Downstream Oil Industry Deregulation Law and Biofuels Act Review of Water Code of the Philippines with regards to protocols of water use for energy Formulate and promote the Energy Reform Agenda Formulate regional energy plans g gy p (Region IV-A, Region VI and Region XI) Develop/update the National Renewable Energy Program (NREP) Update National Biofuels Program Update the Energy Reform Agenda Complete the formulation p of other regional energy plans Develop/update the National Renewable Energy Program (NREP) Update National Biofuels d i l i f l Program Conduct Plan Implementation Review Update Philippine Energy Plan Develop/update the p/ p National Renewable Energy Program (NREP) Update National Biofuels Program Conduct Plan C d l Implementation Review

Medium-term (2011-2013)

Long-term (2013-2016)

Formulate/updat e energy plans p g and programs consistent with national and local development plans

Pillar III: Develop a Sustainable Energy Plan

STRATEGIC DIRECTION
Strengthen policy researches and studies in aid of executive and legislative action

ACTION PLANS
Short-term (2010-2011)
Conduct of policy research on nuclear energy for power generation Conduct a climate change vulnerability assessment of energy resources and facilities.

Medium-term (2011-2013)
Implement a National Nuclear Power Program Formulate an energy sector-wide climate change adaptation strategy

Long-term (2013-2016)
Facilitate the operation of a 2,000 MW nuclear power plant in 2025 Monitor the implementation of the Climate Change Adaptation Strategy

Revitalize partnership with the Affiliated Renewable Energy Centers (ARECs) and other state colleges and th t t ll d universities for continuing research , development and deployment of emerging renewable energy technologies (wind, solar, ocean, etc.)

Pillar III: Develop a Sustainable Energy Plan

STRATEGIC DIRECTION
Interface with Stakeholders for a more participative delivery of energy service

ACTION PLANS
Short-term (2010-2011)
Enhance stakeholders participation in all energy initiatives Remove Red Tape by streamlining issuance of permits and licenses and institutionalizing the Citizens Charter - Issues on RDC/LGU endorsement -I Issues on DENR/NCIP certification - Issues on Energy Sales Agreement

Medium-term (2011-2013)
Establish Energysector Knowledge Management portal

Long-term g (2013-2016)
Empower the LGUs to manage their own power generating power-generating requirements in support of their respective economic development agenda