EXECUTIVE ORDER NO. 215 July 10, 1987
AMENDING PRESIDENTIAL DECREE NO. 40 AND ALLOWING THE PRIVATE SECTOR TO GENERATE ELECTRICITY
WHEREAS, Presidential Decree No. 40 places the responsibility of setting up transmission line grids and the construction of associated generation facilities in Luzon, Visayas, Mindanao and the major islands of the country to the National Power Corporation (NPC);
WHEREAS, the generation of electricity, unlike the transmission and distribution of electricity, is not a natural monopoly and can be undertaken by more than one entity;
WHEREAS, the government, as a matter of policy, is encouraging the private sector to participate in economic development and has started to disengage in areas which can be adequately handled by the private sector;
WHEREAS, the generation of electricity by the private sector can provide a means of increasing power capacity to meet the projected increase in power demand in the future without in any way requiring financial assistance or guarantee from the government;
WHEREAS, there is, on the other hand, an imperative...
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Executive Orders
Amending Presidential Decree No. 40 and Allowing the Private Sector To Generate Electricity
Executive Order No. 215
Executive Order No. 215
Amending Presidential Decree No. 40 and Allowing the Private Sector to Generate Electricity
- Responsibility of National Power Corporation (NPC):
• Setting up transmission line grids and construction of associated generating facilities in Luzon, Visayas, Mindanao, and major islands to meet power demand. (Section 1)
- Private Sector Involvement in Power Generation:
• Private corporations, cooperatives, or associations are allowed to construct and operate the following types of electric generating plants: (Section 1)
a) Cogeneration units for industrial, commercial, heating, or cooling purposes. (Section 1a)
b) Plants intending to sell production to NPC grids, consistent with NPC's developmental plans. (Section 1b)
c) Plants primarily for internal use but also selling excess production to grids. (Section 1c)
d) Plants outside NPC grids, intending to sell directly or indirectly to end-users. (Section 1d)
- Rules and Regulations:
• NPC to formulate rules and regulations for areas within NPC grids. (Section 2)
• National Electrification Administration to formulate rules and regulations for areas outside NPC grids. (Section 2)
• Rules and regulations to include: (Section 2)
a) Qualifications for accrediting private sector generators.
b) Procedures for applying for accreditation as a private sector generator.
c) Obligations of private sector generators, including efficiency standards and penalties.
d) Terms and conditions for purchase or transmission/distribution of electricity generated by non-NPC entities.
e) Other necessary matters to implement the Order.
- Implementation:
• Office of Energy Affairs to take necessary measures to ensure effective implementation. (Section 3)
• Department of National Defense to assist in providing security to generating plants and instituting safeguards in emergencies, including training AFP personnel in power generation operations. (Section 4)
• Amendments to Presidential Decree No. 40. (Section 5)
• Effective 15 days after issuance of implementation rules and regulations. (Section 6)
Amending Presidential Decree No. 40 and Allowing the Private Sector to Generate Electricity
- Responsibility of National Power Corporation (NPC):
• Setting up transmission line grids and construction of associated generating facilities in Luzon, Visayas, Mindanao, and major islands to meet power demand. (Section 1)
- Private Sector Involvement in Power Generation:
• Private corporations, cooperatives, or associations are allowed to construct and operate the following types of electric generating plants: (Section 1)
a) Cogeneration units for industrial, commercial, heating, or cooling purposes. (Section 1a)
b) Plants intending to sell production to NPC grids, consistent with NPC's developmental plans. (Section 1b)
c) Plants primarily for internal use but also selling excess production to grids. (Section 1c)
d) Plants outside NPC grids, intending to sell directly or indirectly to end-users. (Section 1d)
- Rules and Regulations:
• NPC to formulate rules and regulations for areas within NPC grids. (Section 2)
• National Electrification Administration to formulate rules and regulations for areas outside NPC grids. (Section 2)
• Rules and regulations to include: (Section 2)
a) Qualifications for accrediting private sector generators.
b) Procedures for applying for accreditation as a private sector generator.
c) Obligations of private sector generators, including efficiency standards and penalties.
d) Terms and conditions for purchase or transmission/distribution of electricity generated by non-NPC entities.
e) Other necessary matters to implement the Order.
- Implementation:
• Office of Energy Affairs to take necessary measures to ensure effective implementation. (Section 3)
• Department of National Defense to assist in providing security to generating plants and instituting safeguards in emergencies, including training AFP personnel in power generation operations. (Section 4)
• Amendments to Presidential Decree No. 40. (Section 5)
• Effective 15 days after issuance of implementation rules and regulations. (Section 6)