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REPUBLIC OF THE PHILIPPIN:J;S" ~G.Of Tt«: SE~ 
.. 
SENATE OF THE PHILIPPINES 
Pasay City, Metro Manila 
FIFTEENTH CONGRESS 
First Regular Session 
SENATE BILL NO. _--.:.2:::..0:::..2:.::...:..7_ 
Introduced by: HON. EDGARDO J. ANGARA 
ENERGY EFFICIENCY AND CONSERVATION ACT OF 2010 
EXPLANATORY NOTE 
In recent years, the Philippine government has recognized that it is not only an 
advantage, but a looming necessity for the country to attain self-sufficiency through 
maximizing its energy resources, As the country aims for a more self-sufficient energy 
, 
mix, reducing the country's consumption of high-priced imported oil and coal will not 
only be' potentially beneficial to the 
economy, but will also ensure long term 
sustainability, 
Although the country has explored renewable energy and non-conventional 
sources to fuel its developing economy in the past decade, most of which are 
hydropower, geothermal and biofuels for the transport sector, a nationwide energy crisis 
still threatens to loom in the next couple of years, 
To mitigate the impending energy crisis and to reinforce an existing Energy 
Conservation Program of the Department of Energy (DOE), the Energy Efficiency and 
Conservation Program through the Energy Efficiency and Conservation Act shall be 
institutionalized to postpone unmet energy demands in the near future while 
accelerating the country's energy sustainability, 
In view of the foregoing, the immediate passage of the bill is immediately sought. 
jlp/ J !/')'L, ~, 
EDGAROO j~~GARA-' 
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REPUBLIC OF THE PHILIPPINES, Wi a"Of THE SE~'t!lli\l!lf 
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2 
3 
SENATE OF THE PHILIPPINES 
Pasay City, Metro Manila 
FIFTEENTH CONGRESS 
First Regular Session 
/1/ 
SENATE BILL NO. ---.:2=O-=2...:7 __ '''~'ECfIVEn BV r~'~ 
Introduced by: HON. EDGARDO J. ANGARA 
ENERGY EFFICIENCY AND CONSERVATION ACT OF 2010 
AN ACT PROMOTING THE ENHANCEMENT OF ENERGY EFFICIENCY AND 
CONSERVATION THROUGH THE DEVELOPMENT OF ENERGY EFFICIENT 
TECHNOLOGIES, STRENGTHENING ORGANIZATIONAL RELATIONSHIPS AND 
REINFORCEMENT OF RELATED LAWS AND OTHER STATUTORY PROVISIONS 
ON ENERGY. 
Be it enacted by the Senate and the House of Representatives of the Philippines 
in Congress assembled: 
CHAPTER I 
TITLE AND DECLARATION OF POLICIES 
4 
SECTION 1. Short Title - This Act shall be known as the "Energy Efficiency and 
5 
Conservation Act of 2010" 
6 
7 
SECTION 2. Policy Declaration - It is hereby the policy of the state to: 
8 
(a) 
Formulate, 
develop, 
and 
implement the 
Energy Efficiency and 
9 
Conservation Program to ensure sustainable supply of energy to support the 
10 
country's socio-economic goals, 
11 
12 
(b) 
Promote 
and 
encourage 
the 
development 
of 
energy 
efficient 
1 


i 
technologies to ensure the optimal utilization of the country's energy resources. 
2 
3 
(c) 
Improve 
coordination 
among 
different 
government 
and 
non-
4 
governmental organizations to enable the dynamic and effective implementation 
5 
of the Energy Efficiency and Conservation Programs. 
6 
7 
(d) 
Reinforce related laws and other statutory provisions for a more 
8 
comprehensive approach to energy and conservation efficiency in the country. 
9 
10 
SECTION 3. Scope - This act shall establish a framework for introducing an 
II 
effective Energy Efficiency and Conservation Program that will include establishment of 
12 
a research and development initiative towards creating energy efficient technologies, 
13 
encouraging collaboration among organizations, and upholding related laws and other 
14 
statutory provisions. 
15 
16 
SECTION 4. Definition of Terms - As used in this Act, the following terms are 
17 
defined as follows: 
18 
(a) 
Anti-Pilferage Law - refers to Republic Act 7832 or the Anti-Pilferage of 
19 
Electricity and Theft of Electric Transmission Lines/Materials Act, which 
20 
mandates electric utilities to reduce their system loss to ensure that power rates 
21 
reflect only actual consumption. 
22 
23 
(b) 
Cogeneration - refers to the use of high-efficiency energy systems to 
24 
generate both electricity or mechanical power and useful heat from a single 
25 
energy source. 
26 
2 


(c) 
Demand Side Management -
programs undertaken by distribution 
2 
utilities in encouraging end-users to adopt measures towards the proper 
3 
management of their load and efficient utilization of fixed system infrastructures. 
4 
5 
(d) 
Distribution Utilities -
an electric cooperative, private corporation, 
6 
government-owned utility, or existing local government unit (LGU), that has 
7 
exclusive franchise to operate the system of wires and distribution facilities 
8 
extending between the delivery points of the transmission system and the 
9 
customer point of connection. A distribution utility shall have the obligation to 
10 
provide distribution services to any end-user within its franchise area. 
11 
12 
(e) 
Energy Conservation - refers to measures which effect a decrease in 
13 
the level of energy usage through efficient energy use or through reduced 
J4 
consumption of energy services. Such measures shall include, but shall not be 
15 
limited to, information, advice, education, promotion, provision of grants and 
16 
loans. 
17 
18 
(f) 
Energy Efficiency - refers to the efficient utilization of energy resources 
19 
through cost-effective options towards the use of less energy for the same or 
20 
higher performance than regular products or energy systems. 
2J 
22 
(g) 
Statutory Provisions- provisions contained in, or in any document made 
23 
or issued under any Act or Decree whether of a general or special in nature. 
24 
25 
(h) 
System Loss -
refers to the difference between the electric energy 
26 
purchased and/or generated and the electric energy sold by a Distribution Utility. 
3 


For purposes of this Act, the term System Loss shall consist of the following 
2 
components: Technical System Loss, referring to loss inherent in the physical 
3 
delivery of electric energy, including conductor loss, transformer core loss, and 
4 
technical errors in meters; Non-Technical Loss, referring to energy loss not 
5 
related to the physical characteristics of the electrical system, including those 
6 
attributable to pilferage, tampering of meters, and erroneous meter reading; and 
7 
Administrative Loss, or the energy required for the operation of the distribution 
8 
system and any un billed energy for community-related activities. 
9 
10 
(i) 
Waste Heat Recovery-
the use of heat that is produced in a 
11 
thermodynamic cycle (as in a furnace, combustion engine, etc.) in another 
12 
process, through the use of waste heat gas recovery systems that capture and 
13 
use some of the thermal energy in the fuel gas that would otherwise be ejected 
14 
into the environment. 
15 
16 
SECTION 5. Functions and Powers of Government Organizations -
17 
18 
(a) 
The Department of Energy (DOE) shall be the primary agency that will 
19 
plan, develop and implement the energy conservation and energy efficiency 
20 
programs and activities. The DOE is tasked to consult and coordinate with other 
21 
government units for a more effective implementation of energy policies. 
22 
23 
(b) 
The Department of Environment and Natural Resources (DENR) shall 
24 
coordinate with the DOE in establishing and enforcing the limitation in the 
25 
exploitation of indigenous energy resources. 
26 
27 
(c) 
The Department of Science and Technology (DOST) shall coordinate 
4 


with the DOE in institutionalizing a strategic research and development program 
2 
aimed at facilitating the development of energy efficient technologies in the 
3 
country. 
4 
5 
(d) 
The Department of Trade and Industry (DTI), in consultation with the 
6 
DOE, shall set standards for energy consumption and efficiency for machineries, 
7 
appliances and equipments that will be sold in the country. 
8 
9 
(e) 
The Department of Transportation and Communication (DOTC), together 
10 
with the DOE, DENR and DTI, in consultation with the transport sector and Non-
11 
Government Organizations shall set the standards in motor vehicle efficiency and 
12 
emissions. 
13 
14 
(f) 
The Department of Finance (DOF) shall define the applicability of 
15 
incentives to energy efficiency and conservation projects in accordance with 
16 
existing laws. 
17 
18 
(g) 
The Department of Education (DepEd) and Commission on Higher 
19 
Education (CHED) shall integrate energy efficiency and conservation concepts in 
20 
their respective educational programs. 
21 
22 
(h) 
The Energy Regulatory Commission (ERC) shall perform the regulatory 
23 
functions in relation to the energy efficiency and conservation programs of the 
24 
distribution and supply sectors. 
25 
26 
(i) 
The National Electrification Administration (NEA) shall endeavor to 
5 


enhance the operational capability of Electric Cooperatives in relation to energy 
2 
efficiency and conservation. 
3 
4 
SECTION 6. Contribution of Private and Non-Government Agencies -
5 
Private and non-governmental organizations are encouraged to actively participate in 
6 
the energy efficiency and conservation endeavors of the country. 
7 
8 
SECTION 7. Energy Efficiency and Conservation Fund -
An 
Energy 
9 
Efficiency and Conservation Fund or the "EEC Fund" is hereby created to be funded out 
10 
of the contributions from distribution utilities, generation companies and transport 
II 
entities. These contributions pertain to a percentage of said entities' gross revenue, 
12 
with the reasonable percentage to be set and reinforced by the ERC, for the generation 
13 
and distribution sectors, and the DOTC, for the transport sector: Ten percent (10%) of 
14 
this EEC Fund shall be pooled according to the concerned sector, and shall be used to 
15 
fund programs that shall benefit the sector as a whole, which programs shall be 
16 
composed of, but not limited to, the conduct of Research & Development and enabling 
17 
technology transfer in relevant areas for the sector. The ERC and the DOTC shall act 
18 
as the administrators of the funds, for the generation and distribution, and transportation 
19 
sectors, respectively. 
Said funds shall be disbursed in an open and transparent 
20 
manner, and shall only be used for the intended purposes. The remaining ninety 
21 
percent (90%) of the allocated percentage of the entities' revenues shall be for the 
22 
respective entities' programs towards energy efficiency and conservation, and shall be 
23 
used for upgrading, repairs, maintenance, expansion of existing facilities or such other 
, 
24 
programs· that 
shall 
enhance 
the 
performance 
and 
efficiency 
of existing 
25 
infrastructures. Said entities are likewise mandated to comply with the approval and 
26 
reporting requirements, as stipulated in Chapter IV Section 14 of this Act. 
27 
28 
6 


CHAPTER II 
2 
CONVERSION TO ELECTRICAL ENERGY 
3 
4 
SECTION 8. Plant Efficiency - To encourage endeavors on plant efficiency 
5 
improvement and increase the operating capacities of existing power plants and to 
6 
exploit the potential of technology in exploring other sources of energy, the following 
7 
policies shall be observed: 
8 
9 
(a) 
The National Power Corporation, in coordination with the DOE, shall 
10 
develop and undertake a plan for plant efficiency improvement programs in all 
11 
the plants it owns. 
12 
13 
. (b) 
The Board of Investments (BOI) in coordination with the DOE, the DOF 
14 
and the DOST shall establish a targeted tax relief mechanism for imported 
15 
machinery to encourage private companies to improve their plant efficiencies. 
16 
17 
(c) 
The DOE, in coordination with the BOI and the DTI shall develop an 
18 
incentive mechanism based on the increased efficiency of a distribution utility. 
19 
20 
(d) 
All government and private generating companies are required to 
21 
improve their plant efficiencies after three (3) years upon the effectivity of this 
22 
Act, which, however, shall in no case exceed seven (7) years. The ERC in 
23 
coordination with DOE shall monitor plant efficiency improvement programs 
24 
implemented by generating companies. 
25 
26 
7 


SECTION 9. Waste Recovery and Cogeneration Plants - To exploit the 
2 
possible benefits of cogeneration and waste recovery technologies, the following 
3 
policies are hereby ordered and mandated: 
4 
5 
(a) 
The DOE shall steer an inter-agency technical committee composed of 
6 
representatives from the DOST, the DENR, the ERC, the DA and the DTI and 
7 
other relevant organizations which shall explore new markets for waste recovery 
8 
and cogeneration and exploit the possible benefits of cogeneration. A report will 
9 
be given to the DOE for evaluation and further action. 
10 
11 
(b) 
The DOST shall undertake and sustain research and development 
12 
programs in cogeneration and waste recovery technologies. 
13 
14 
CHAPTER III 
15 
ELECTRICAL ENERGY TRANSMISSION AND DELIVERY 
16 
17 
SECTION 10. 
Imposition of System Loss Caps - All Distribution Utilities 
18 
shall reduce systems losses to percentage levels duly determined by the ERC to protect 
19 
consumers from unreasonable electric rates. Towards this end, the ERC shall carry out 
20 
the following, in addition to any other act that it may deem proper: 
21 
22 
a) 
Design comprehensive mechanisms in determining the System Loss 
23 
caps that are achievable, time-bound and reflective of the current conditions of 
24 
the Distribution Utilities. 
25 
8 


b) 
Require the Distribution Utilities to submit the annual financial 
2 
statements for monitoring and auditing purposes. 
3 
4 
SECTION 11. 
Enforcement of the Anti-Pilferage Law - The Anti-Pilferage 
5 
Law shall be strengthened further and be fully enforced with the coordination of the LGU 
6 
and the utility owning the distribution franchise of the area. 
7 
8 
a) 
The Congress shall revisit and evaluate the applicability of the 
9 
Provisions of the Anti-Pilferage Law to the Distribution Utilities and its customers 
10 
and come up with necessary amendments that will favor a significant impact of 
11 
the Anti-Pilferage Law to Systems loss Reduction and which will adequately 
12 
address the changes in the power sector. 
13 
14 
b) 
The Distribution Utilities shall initiate a tri-media campaign within their 
15 
respective areas of franchise that will raise the public's awareness of the relevant 
16 
provisions ofthe Anti-Pilferage Law. 
17 
18 
SECTION 12. 
Technology Development and Transfer - The DOE shall 
19 
steer the proviSion of the necessary technical assistance and formulation of efficient 
20 
technology leading to Systems Loss Reduction. 
21 
22 
a) 
The DOE together with the DOST shall sponsor and intensify research 
23 
and development in systems loss reduction technologies. The research grants 
24 
shall be given to the duly identified members of the academe and/or experts in 
25 
the field. Funding of these research and development initiatives shall be 
26 
determined as indicated in Section 7 of this Act. 
9 


2 
b) 
The DOE and ERC shall intensify technology transfer on efficient 
3 
transmission and delivery systems through the conduct of trainings and seminars 
4 
to Distribution Utilities covering effective approaches to reduce systems loss. 
5 
6 
c) 
The ERC shall impose the submission among Distribution Utilities of a 
7 
monthly performance report on Systems Loss Reduction of all Distribution 
8 
Utilities. These reports will aid the DOE to identify Distribution Utilities that need 
9 
monitoring and technical assistance. The ERC shall likewise, make the reports 
10 
timely and accessible to the public. 
11 
12 
SECTION 13. 
Installation of Efficient Transmission and Distribution 
13 
System - The DOE shall promote Efficient Transmission and Distribution System 
14 
through the provision of incentives and benefits enumerated in Chapter VII of this Act to 
15 
Distribution Utilities that will undertake measures to improve the efficiency of their 
16 
transmission and distribution networks. 
17 
18 
. a) 
Each Distribution Utility shall bi-annually submit an Electricity Distribution 
19 
Network Enhancement Plan that will be constituted by an assessment of its 
20 
current network efficiency and a proposal on its Network Efficiency enhancement 
21 
scheme. The Enhancement Plan shall be considered an Energy Efficiency 
22 
project and shall be entitled to incentives mentioned in Chapter VII of this Act as 
23 
may be applied. 
24 
25 
b) 
The ERC shall encourage the retirement of inefficient Transmission and 
26 
Distribution equipment such as transformers and capacitors. 
10 


2 
c) 
Loan grants shall be given to expanding Rural Electric Cooperatives 
3 
upon presentation of an energy efficient expansion plan. 
4 
5 
6 
7 
CHAPTER IV 
ELECTRICAL ENERGY UTILIZATION 
8 
SECTION 14. 
Demand 
Side 
Management 
and 
Load 
Profile 
9 
Management (DSM-LPM) - To promote Load Profile Management: 
10 
11 
(a) 
The ERC shall undertake an in-depth assessment of the country's 
12 
Demand Side Management Program and likewise conduct benchmarking studies 
13 
on successful DSM Programs in other countries, towards determining an optimal 
14 
plan for the Philippines. 
The ERC, in collaboration with the DOE, shall 
15 
encourage private and public sector participation in setting clear and measurable 
16 
targets for the performance of distribution utilities. Further, an equitable incentive 
17 
mechanism shall be determined towards minimizing energy consumption using 
18 
Part (b) of this section as the basis of the incentive provision. 
19 
20 
(b) 
The ERC, in collaboration with Metering Service Providers (MSPs), shall 
21 
formulate strategic monitoring mechanisms in determining the baseline energy 
22 
consumption of the Distribution Utilities and Electric Cooperatives, and analyzing 
23 
subsequent impacts of the Demand Side Management Program in the energy 
24 
consumption of each Distribution Utility. 
25 
26 
11 


(c) 
The ERC shall create a Demand Monitoring Division that shall strictly 
2 
monitor the performance of Distribution Utilities vis-a-vis DSM determined targets 
3 
and performance indicators. 
4 
5 
(d) 
To reinforce the DSM Program, an Inter-Agency Committee, headed by 
6 
the Department of Energy, shall be formed with the specific task of educating 
7 
consumers. The Committee shall be composed of representatives from the NEA, 
8 
the DOST, the DepEd and representatives from Distribution Utilities. 
9 
10 
(e) 
Within three (3) months from the determination of the DSM-LPM 
11 
Program, all Private Distribution Utilities and Electric Cooperatives shall be 
12 
required to allocate a reasonable percentage of their gross revenue to fund their 
13 
DSM-LPM Program. 
14 
15 
(f) 
Towards the determination abovementioned percentage, the NEA shall 
16 
conduct nationwide stakeholder consultation with Distribution Utilities and shall 
17 
submit their evaluation to the ERC for approval. 
Upon approval, the ERC 
18 
Demand Side Monitoring Division shall be tasked with constant monitoring of the 
19 
Distribution Utilities programs and fund allocation. 
20 
21 
(g) 
The ERC shall work jointly with the DOF to determine the feasibility of 
22 
granting Tax Relief to the Distribution Utilities, which shall be channeled to the 
23 
DSM fund. 
24 
25 
SECTION 15. 
Time 
Of Use 
Rates 
-
To 
further strengthen 
the 
26 
government's initiatives in energy efficiency and conservation, an appropriate and 
12 


equitable Time of Use (TOU) Rate Mechanism shall be determined: 
2 
3 
(a) 
To support the DSM Program, the ERC, in consultation with Distribution 
4 
Utilities, shall determine the appropriate TOU Rate Determination Mechanism. 
5 
6 
(b) 
The ERC shall take charge of educating the Distribution Utilities on the 
7 
dynamics of the abovementioned mechanism to ensure the Distribution Utilities 
8 
operational competence in adopting the scheme. 
9 
10 
(c) 
Within three (3) months of the ERC's determination of the TOU Rate 
11 
Mechanism, the Commission shall require the Distribution Utilities and Electric 
12 
Cooperatives to implement the optional TOU rates to their consumers. 
13 
14 
(d) 
In addition, the ERC shall conduct in-depth analysis on alternative rate 
15 
mechanisms that may likewise be adopted towards enabling demand side 
16 
management and equitable pricing. 
17 
18 
SECTION 16. 
Energy 
Efficient Appliance 
and 
Standards 
-
To 
19 
encourage the use of energy efficient appliances, the following shall be observed: 
20 
21 
(a) 
The DOE shall encourage extensive Research and Development in new 
22 
technologies through the establishment of the necessary support infrastructure to 
23 
pr9mpt the country's competitiveness in the development of appliances with high 
24 
efficiencies and to further augment R&D ventures in efficiency improvements. 
25 
26 
(b) 
The DOE and the DOST shall jointly design a. strategic plan for 
13 


technology development in the country, in recognition of the need to circumvent 
2 
possible fragmentation of research and development activities. 
To further 
3 
promote energy efficiency orientation, the DOST and the DepEd shall create 
4 
scholarships in strategic fields. 
5 
6 
(c) 
An inter-agency Committee shall be created towards advancing 
7 
university-based energy technology centers to optimize government-industry-
8 
academe cooperation. This Committee shall be composed of the Secretaries of 
9 
the DOST, DOE, DepEd, an expert from the Academe, as well as a 
10 
representative from the private sector. This Committee shall design a program 
11 
towards 
eliciting 
private 
sector 
investment 
through 
partnerships 
and 
12 
collaborations in order to develop energy efficient technologies. 
13 
14 
(d) 
The DOE shall likewise foster govemment and industry collaboration in 
15 
jointly setting up appliance standards, as well as the associated procurement 
16 
polices. Having determined the applicable standards, the DOE shall set the 
17 
minimum criteria for compliance, and shall strictly enforce said criteria. The DOE 
18 
shall conduct a yearly evaluation of the determined standards. 
19 
20 
(e) 
To facilitate energy efficiency labeling, the DOE shall create additional 
21 
testing laboratories and centers to accommodate supplier and consumer 
22 
initiatives towards compliance with standards. 
23 
24 
(f) 
The DOE shall ensure appliance labeling of energy efficiency ratings by 
25 
2010. 
Distributors and manufacturers are hereby compelled to acquire DOE 
26 
certification and labels for their appliances. Penalties shall be imposed to non -
27 
complying distributors and manufacturers in accordance with Section 23 of this 
14 


Act. 
2 
3 
(g) 
Government agencies shall incorporate DOE's energy efficiency 
4 
standards into their procurement policies. 
5 
6 
CHAPTER IV 
7 
TRANSPORT FUEL CONVERSION AND UTILIZATION 
8 
9 
SECTION 17. 
Fuel Efficiency 
10 
11 
(a) 
The DOTC, together with the DOE, the DENR and the DTI in 
12 
consultation with the transport sector and concerned non-governmental 
13 
Organizations shall set the standards in motor vehicle efficiency and emissions. 
14 
15 
(b) 
The DOTC shall promulgate rules and regulations in the registration and 
16 
banning of motor vehicles, including fines and penalties, on motor vehicles that 
17 
will not adhere to the provisions that are set in Subsection (a) of this Section. 
18 
19 
(c) 
The DOE shall encourage technology development that will increase 
20 
motor engine efficiency vis-a-vis technology transfer among major car producing 
21 
countries. 
22 
23 
(d) 
To discourage the use of vehicles with high fuel consumption, a 
24 
classification shall be made in terms of fuel consumption rate and the appropriate 
25 
registration and purchase taxes shall be imposed accordingly by the L TFRB and 
15 


DOTC. 
2 
3 
SECTION 18. 
Mass Transport System 
4 
5 
(a) 
To support fuel efficiency program, the DOTC, DPWH, DTI and NEDA 
6 
shall formulate a Mass Transport System Infrastructure Program that will address 
7 
current and future requirements in mass transport. 
8 
9 
(b') 
Mass transport system projects utilizing light rail system shall be granted 
10 
to. duly identified investors through a build-operate-transfer scheme or 
II 
government-private sector partnership to ease up the government from high 
12 
capital expenditures. 
13 
14 
(c) The DOTC shall intensify the regulation and administration of registration 
15 
among public utility vehicles ensuring that only public utility vehicles that adhere 
16 
to standards set as provided in Section 17(a) are the only vehicles that are 
17 
granted a franchise to operate. 
18 
19 
(d) 
The DOTC together with the Metro Manila Development Authority and 
20 
the respective urban development authorities shall permanently designate 
21 
strategic loading stations/terminal for public utility vehicles. The locations of 
22 
loading stations that will be constructed shall be strategically determined to aid in 
23 
the traffic decongestion of national highways. 
24 
25 
CHAPTER V 
26 
ENERCON INFORMATION PROGRAMS 
16 


2 
SECTION 19. 
Promotion of Energy Conservation and Management -
3 
To increase awareness and educate various sectors regarding energy conservation and 
4 
management, the DOE shall have the following responsibilities: 
5 
6 
(a) 
Design and embark on an extensive Energy Management Education 
7 
Program that will increase consciousness of the Energy Efficiency and 
8 
Conservation Program among government, residential, commercial and industrial 
9 
sectors; 
10 
11 
(b) 
Educate various sectors through the use of the televiSion, radio and 
12 
newspaper media regarding energy efficiency and conservation. 
13 
14 
(c) 
Study, along with DepEd and CHED, the incorporation of energy 
15 
conservation and management subjects in the primary, secondary and tertiary 
16 
education curricula. 
17 
18 
19 
20 
21 
SECTION 20. 
CHAPTER VI 
ENVIRONMENTAL COMPLIANCE 
Compliance with 
Environmental 
Regulations -
All 
22 
EnerCon Policies and Programs shall be conducted in accordance with existing 
23 
environmental regulations as prescribed by the DENR and/or any other concerned 
24 
government agency. 
25 
17 


2 
3 
4 
SECTION 21. 
CHAPTER VII 
GENERAL INCENTIVES 
Incentives for Energy Efficiency and Conservation 
5 
Projects - The favored energy efficiency and conservation projects listed in the 
6 
preceding section shall, for a period of five (5) years upon the effectivity of this Act, be 
7 
entitled to the following incentives; 
8 
9 
(a) 
Tax and Duty-Free Importation of Capital Equipment - The importation 
10 
of machinery, equipment and spare parts of energy conservation projects defined 
11 
herein shall be exempt to the extent of one hundred percent (100%) of the 
12 
customs duties and national internal revenue taxes payable thereon subject to 
13 
the condition that said machinery, equipment and spare parts of comparable 
14 
quality, delivery and price (1) are not manufactured domestically; (2) are 
15 
reasonably needed and will be used exclusively by the proponent enterprise for 
16 
energy efficiency and conservation projects; and (3) the approval of the DOE was 
17 
obtained by the proponent enterprise for the importation of such machinery, 
18 
equipment and spare parts. In granting said approval, the DOE may require 
19 
international canvassing: provided, that if the total cost of the capital equipment 
20 
exceeds five million US dollars (US$5,000,OOO.OO), the DOE may avail of the 
21 
provisions of Presidential Decree No. 1764 on international competitive bidding; 
22 
and 
23 
24 
(b) 
Tax Credit on domestic Capital Equipment - A tax credit equivalent to 
25 
one hundred percent (100%) of the customs duties and national internal revenue 
26 
taxes' on the machinery, equipment and spare parts which would have been 
27 
waived had these' items been imported, shan be given to the proponent 
18 


enterprise which purchases said machinery, equipment and spare parts from a 
2 
domestic manufacturer: Provided, that (1) the said machinery, equipment and 
3 
spare parts are reasonably needed and will be used exclusively by the proponent 
4 
enterprises for energy conservation projects; (2) the machinery, equipment and 
5 
spare parts would qualified for tax and duty-free importation under Paragraph (a) 
6 
this Section; and (3) the prior approval of the DOE was obtained by the 
7 
proponent enterprise. 
8 
9 
CHAPTER VII 
10 
GENERAL PROVISIONS 
11 
12 
SECTION 22. 
Rules and Regulations - The DOE, in coordination with the 
13 
various departments and/or entities empowered to reform certain acts in the preceding 
14 
sections, shall within sixty (60) days from the effectivity of this Act, conduct public 
, 
15 
hearings and issue such rules and regulations as may be necessary to implement this 
16 
Act. Such rules and regulations shall be subject to the approval of the President and 
17 
shall take effect fifteen (15) days after their last publications in at least two (2) 
18 
newspaper of general circulation in the Philippines once a week for two (2) consecutive 
19 
weeks. Where necessary, the DOE or the departments mandated to undertake activities 
20 
as herein provided may seek assistance from other government agencies or non-
21 
government organizations for the effective implementation of this Act. 
22 
23 
SECTION 23. 
Penalties - Any person who violates any rule or regulations 
24 
promulgated pursuant to the authority granted in this Act shall, upon conviction, be 
25 
punished by a fine of not less than ten thousand pesos (P10,OOO.OO) but not more than 
26 
five hundred thousand pesos (P500,OOO.OO) or by imprisonment of not less than six (6) 
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months but not more than one (1) year or both, at the discretion of the court; Provided, 
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• 
That if the violation is committed by a judicial person, the penalty herein shall be 
2 
imposed upon the official and/or employee thereof 
responsible for the violation: 
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Provided, further, That if the violation is committed by a government official or employee 
4 
including those in government-owned controlled corporations he shall in addition to the 
5 
penalty provided above, be subjected to administrative disciplinary action. 
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SECTION 24. 
Contingency Powers -
In times of critical energy supply 
8 
disruptions or imminent danger thereof, the President shall direct the adoption of 
9 
stringent energy conservation measures, including but not limited to power/fuel 
10 
allocations or rationing, limiting the operating hours of commercial, industrial and similar 
11 
establishments, restricting the use of government and private motor vehicles, staggering 
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or limiting working hours in both public and private sectors and the temporary closure of 
13 
all intensive industries. 
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SECTION 25. 
Repealing Clause -
Any provision of law, presidential 
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decree, executive order, or rules and regulations inconsistent with the provisions of this 
17 
Act or with the rules and regulations issued pursuant thereto is hereby repealed or 
18 
modified accordingly. 
19 
20 
SECTION 26. 
This Act shall take effect fifteen (15) days after its complete 
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publication in the Official Gazette or in two (2) newspapers of general circulation. 
22 
23 
Approved, 
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