Republic of the Philippines
HOUSE OF REPRESENTATIVI
Queson City

SEVENTEENTH CONGRESS
First Regular Session

HOUSE BILL No,_4739

Introduced by HONORABLE LUIS RAYMUND F. VILLAFUERTE, JR.

EXPLANATORY NOTE

The Philippines is described as “ground zero for climate disaster’, The World
Bank designated the Southeast Asian expanse of 7,107 islands as one of the world’s
most “vulnerable” countries in terms of susceptibility to natural disasters attributed to
climate change.”

Abrupt climate change is not only imminent, it is here. It is consequently
necessary to make a significant contribution to the global effort to stabilize
greenhouse gas (GHG) concentrations in the atmosphere. Carbon dioxide (CO2) is
one of the most dangerous greenhouse gases. CO2 stays in the atmosphere for a
thousand of years. It traps heat and make the planet warmer. Major sources of CO2
emissions from human activities in the Philippines are from burning fuels for
electricity, transportation, heat, among others.° To illustrate, CO2 emissions from
electricity and heat production in the country has been increasing — total (% of total
fuel combustion) was 49.74 as of 2013. Its highest value over the past 42 years was
49.74 in 2013, while its lowest was 25.83 in 1972.

Based on the foregoing, the Philippines must adopt aggressive measures to
address the GHG emission crisis. In October 2015, the country submitted its
Intended Nationally Determined Contribution (INDC) to the United Nations (UN)
where it “intends to undertake GHG emissions reduction of about 70% relative to its
Business As Usual scenario of 2000-2030."° Pursuant to this undertaking, this bill
introduces the climate tax — a levy on the level of carbon dioxide emissions from

‘ Worland, Justin. 2015 December 8. Philippines: Ground Zero for Climate Disaster. Time Magazine. Retrioved
{fom http:/time.com/4137 154/philippines-ground-zero-for-climate-disaster!

* The World Bank, Getting a Grip on Climate Change in the Philippines. Retrieved from

http://www. worldbank.org/en/country/philippines publication/getting-a-grip-on-climate-change-in-the-philippines

* Republic of the Philippines, Intended Nationally Determined Contributions (INDC), 1 October 2015.

“carbon Dioxide Information Analysis Center, Environmental Sciences Division, Oak Ridge National Laboratory.
Tennessee, United States. Retrieved from: http://www.indexmundi.com/facts/philippines/co2-emissions

* Republic of the Philippines, Intended Nationally Determined Contributions (INDC), 1 October 2015.


electricity consumption. The CO2 emission shall be measured in kilograms per
kilowatt hour, A kilogram of CO2 emission shall be worth One Peso (PhP 1.00).

All monies collected under this Act shall be earmarked solely and used
exclusively for providing programs that assist communities in adapting to climate
change and managing disaster risks; improving the resiliency of critical
infrastructure; protecting environmental quality and wildlife; and meeting international
commitment made by the Philippines to assist with climate change adaptation and
disaster risk reduction and management.

This bill is a first of its kind in the country. It recognizes the unfortunate status
quo of the environment and encourages every Filipino to act now. The proceeds of
the fund shall be used to explore alternative and cleaner sources of energy, provide
better public transportation, and disseminate climate change awareness.

The “Piso Para sa Kalikasan Act’ is important not only because it signals our
country’s commitment to international climate policy but also it sends the important
message that a Philippine climate policy is serious and here to stay. Since the right
to a balanced and healthful ecology carries with it the correlative duty to refrain from
impairing the environment, it is a paramount obligation of the State to safeguard
such right lest such day will come when' all else would be lost and the generations to
come shall inherit nothing but a parched earth incapable of sustaining life.®

The immediate approval of this bill is earnestly sought.

Vk .

Lu \YMUND /LRAY” VILLAFUERTE, JR.

° GR. No. 101083. Oposa, et al. vs. Factoran, et al. 30 July 1993.


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Queson City

SEVENTEENTH CONGRESS
First Regular Session

HOUSE BILL NO. 47239

Introduced by HONORABLE LUIS RAYMUND F. VILLAFUERTE, JR.

AN ACT IMPOSING CLIMATE TAX ON ELECTRIC POWER CONSUMPTION

Be it enacted by the Senate and House of Representatives of the Philippines in
Congress assembled:

SECTION 1. Short Title. — This Act shall be known as the "Piso Para sa Kalikasan
Act".

SECTION 2. Declaration of Policy. — It is a declared policy that the State shall
protect and advance the right of the people to a balanced and healthful ecology in
accord with the rhythm and harmony of nature. The State shall also attain and maintain
a balance between development and environmental protection

Accordingly, the State shall promote methods that will preserve a healthy
environment for future generations and prevent factors that greatly contribute to its
destruction.

SECTION 3. Definition of Terms. — For purposes of this Act, the following
definitions shall apply to the following terms:

a. Carbon emission or CO2e means the amount of carbon dioxide emitted to
the environment from electricity consumption and vehicle usage.

b. Climate Tax on Electricity or CTE means the amount imposed on CO2e
from electricity consumption measured in kilograms per kilowatt hour.

c. Renewable energy means any energy source that is naturally generated
over a short time scale and derived directly from the sun (such as thermal,
photochemical, and photoelectric), indirectly from the sun (such as wind,
hydropower, and photosynthetic energy stored in biomass), or from other
natural movements and mechanisms of the environment (such as geothermal
and tidal energy). Renewable energy does not include energy resources
derived from fossil fuels, waste products from fossil sources, or waste
products from inorganic resources.


d. Person means natural or juridical person.

e. Residential user means any person who consumes electricity and receives a
monthly electric utility bill.

SECTION 4. Amount of Climate Tax. — The amount of Climate Tax on Electricity
(CTE) shall be equal to One Peso (P1.00) per one kilogram of CO2e.

SECTION 5. Coverage and Fees. ~ CTE shall be imposed on the monthly electric
power consumption per electric utility bill of every Residential user of electric power
utilities in proportion to the CO2 emission generated from electricity consumed, to wit:

Formula: E x 0.553 = CTE

Where:

E is the electricity consumption in kWh;

0.553 is the CO2 emission in kilogram per kWh of electricity;
and

CTE is applicable tax

SECTION 6. Exemptions. — Any Residential user shall be exempt from the
coverage of this Act provided that:

a. The monthly electricity bill does not exceed 60 kilowatt hour; or
b. Any form of Renewable energy is used as a source of electricity.

Provided, further that, Residential user shall be issued a certificate from the
Department of Energy (DOE) showing utilization of Renewable energy to claim
exemption or a refund under Section (b)

SECTION 7. Disposition of Monies Collected. — All monies collected under this
Act shall be earmarked solely and used exclusively for the following purposes:

a. Providing programs that assist communities in adapting to climate change and
managing/reducing disaster risks;

b. Improving the resiliency of critical infrastructure;

c. Protecting environmental quality and wildlife;

d. Meeting international commitment made by the Philippines to assist with
climate change adaptation and disaster risk reduction and management; and

e. Other programs and/or commitments related to the foregoing purposes and
necessary to attain the objectives of this Act.

SECTION 8. Implementing Rules and Regulations, — Department of Finance
(DOF) in coordination with DOE, the Department of Environment and Natural
Resources (DENR) and Department of Budget and Management (DBM) shall
promulgate not later than thirty (30) days upon the effectivity of this Act the necessary
rules and regulations for its effective implementation.

SECTION 9. Separability Clause. — If any section or part of this Act is held
unconstitutional or invalid, the other sections or provisions not otherwise affected shall
remain in full force and effect.


SECTION 10. Repealing Clause. — All laws, decrees, executive orders, rules and
regulations, issuances or any part thereof inconsistent with the provisions of this Act,
are hereby repealed, amended or modified accordingly.

SECTION 11. Effectivity. - This Act shall take effect fifteen (15) days after its
publication either in the Official Gazette or in at least two (2) national newspapers of
general circulation.

Approved,