Republic of the Philippines
HOUSE OF REPRESENTATIVES //
Quezon City 2

SEVENTEENTH CONGRESS
First Regular Session

House Bill No.4594

INTRODUCED BY REPRESEN’

VE ARTHUR C. YAP

EXPLANATORY NOTE

Climate change is now a reality. Recent scientific assessments have
confirmed that this warming of the climate system is primarily due to human
activities that have caused the greenhouse gas concentrations from the
burning of fossil fuels and land use change. Current warming has increasingly
posed quite considerable challenges to man and the environment. We need to
consider a more pro-active adaptation planning in order to ensure sustainable
development in the future.

Climate change and global warming concems coupled with high oil
prices are driving increasing renewable energy legislation, incentives
and commercialization.

Renewable energy is generally defined as energy that is collected
from resources which are naturally replenished on a human timescale, such
as sunlight, wind, rain, tides, waves, and geothermal heat. In rural and remote
areas where transmission and distribution of energy generated from fossil
fuels can be difficult and expensive, producing renewable energy locally
seems to offer a viable alternative.

However, renewable energies are also often regarded to be too
expensive and not competitive with conventional fuels to cover electricity
demands — especially in a developing country like the Philippines. It is a
common perception that renewables are highly expensive technologies,
increase the price of electricity and need further private investments or
government subsidies in the energy system.

Private and public financing from both domestic and external sources
will be necessary and should be seen as complements rather than substitutes.
Unlocking the potential of the private sector is indispensable for energy access
in the country. Providing affordable and reliable access to energy to private
sector actors will enable them to function as an engine of growth and thereby


advance the economic transformation. Better energy access will thus lead to
enhanced enterprise development and increase in income generating
activities.

This bill seeks to promote the use of renewable energy in the country
to combat global warming and climate change by providing incentive to the
private sector to engage in the development of the sector. To achieve this goal,
this measure mandates the Bureau of Internal Revenue (BIR) to refund to
taxpayers the amount not exceeding fifty percent (50%) of the tax they have
paid for the immediately preceding taxable year as rebates for their purchases
of renewable energy devices or components thereof.

In view of the foregoing, the immediate passage of this measure is
earnestly sought.

Representative


a

Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SEVENTEENTH CONGRESS
First Regular Session

4594

House Bill No. __~

INTRODUCED BY REPRESENTATIVE ARTHUR C. YAP

AN ACT
PROMOTING RENEWABLE ENERGY, MANDATING
TAX REBATES FOR INDIVIDUALS PURCHASING
RENEWABLE ENERGY DEVICES OR SYSTEMS, AND
FOR OTHER PURPOSES

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

SECTION 1. Declaration of Policy. - It shall be the policy of the
State to promote the use of renewable energy to combat global warming and
climate change.

SECTION 2. Definition of Terms. - For purposes of this Act, the
following terms shall mean :

a) Renewable energy — the form of producing energy derived from
environmentally friendly source such as solar, wind, hydro, geothermal,
sea waves and other similar sources which do not employ the use of
fossil fuel or the likes of it;

b) Device — the object, in whole or part, of a system that produces or

stimulates, aids or enhances the production of energy or any other thing;


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c) Rebates — the refund or repayment by the government to a taxpayer who
has duly paid his taxes. The rebate should be in the form of cash or
similar instrument that could be readily available for use by the
beneficiary;

d) Individual — shall refer to a natural or juridical person;

e) Solar panels — the device which produces electrical energy by mere
exposure to light in accordance with photovoltaic principles and similar
technologies;

f) Wind turbines — devices that produce energy from the wind; and,

8) Hydroelectric components — those objects, instruments, gauges, wires,
support structures, alternators, charge controllers, batteries and other
related materials or system components that are used to produce energy
from hydro power.

SECTION 3. The Bureau of Internal Revenue (BIR) shall, upon

request by an individual taxpayer, refund to the said taxpayer the amount not
exceeding fifty percent (50%) of the tax he has paid for the immediately
preceding taxable year, or Fifty Mullion Pesos (P 50,000,000,00) whichever
is lower, as rebates for the taxpayer’s purchase of renewable energy device or

components thereof such as but not limited to the following:

a) Solar panels and/or support components;

b) Wind turbines, assembly, parts and/or support components;
c) Hydroelectric system, parts and or components;

d) Inverter parts, assembly or components;

e) Charge controller parts, assembly or components;

£) Power storage batteries of any kind; and,


g) Other renewable energy system or components as certified by the

Department of Science and Technology (DOST).

‘The amount of rebates, however, should not exceed sixty percent (60%)
of the amount of purchase of renewable energy devices, parts or system by an
individual.

System purchase rebates shall include the cost of labor, consultancy and
other related technology support services in connection with the installation
of purchased renewable energy devices, parts or system by an individual.

SECTION 4. Implementing Rules and Regulations. - The
Department of Finance (DOF) in cooperation with DOST shall issue the
necessary rules and regulations for the effective implementation of this Act.

SECTION 5. Separability Clause. — Any portion or provision of this
Act which may be declared unconstitutional or invalid shall not affect the
other portions or provisions hereof.

SECTION 6. Repealing Clause. - All other laws, ordinances, rules,
regulations and other issuances or parts thereof, which are inconsistent with
this Act, are hereby repealed or modified accordingly.

SECTION 7. Effectivity. - This Act shall effect fifteen (15) days after
its publication in the Official Gazette or in at least two (2) newspapers of
general circulation.

APPROVED,