President of the Philippines signs order to expedite major energy projects

The signing of Executive Order No. 30 (EO 30) by President Rodrigo Duterte in June 2017 is set to nurture the long-term goals of the Philippine Energy Plan 2017-40 (PEP) by acting as a catalyst for major energy projects. The order seeks to address the lengthy and cumbersome permit process, which, in turn, has stalled investment and restricted the development of the national grid. The timeframe for project approval, particularly for ventures marked as energy projects of national significance (EPNS), is set to decrease significantly.

To this end, the Energy Investment Coordinating Council (EICC) was established in 2017 under the Department of Energy (DoE) to accelerate the execution of large-scale energy projects. In terms of responsibilities, the EICC is in charge of simplifying the process of obtaining permits and regulatory approvals, as well as resolving inter-agency issues that may delay project implementation.

Specifics

Under its current structure, the EICC consists of members of various government agencies and relevant institutions, including: the Department of Environment and Natural Resources (DENR); the Department of Finance; the Department of Justice; the Department of Transportation; the National Electrification Administration; the National Grid Corporation of the Philippines; the National Transmission Corporation; the Housing and Land Use Regulatory Board; and the Palawan Council for Sustainable Development, among others.

As per E0 30, a project must meet certain criteria to be classified as an EPNS. The development must have a minimum capital investment of P3.5bn ($69.1m) and have the potential to make a significant contribution to the country’s economic development and balance of payments, as well as have a positive impact on the environment.

To speed up the permit process, an agency must act on applications for a EPNS within 30 days. If any project is denied, the agency must respond in writing. If an agency fails to meet the response deadline, the project will automatically be approved within five Agencies must act under the notion of “presumption of prior approvals”, meaning that they should process an EPNS application without waiting for the approval from another agency. Previously, the permit process could take as long as four years, with more than 300 signatures needed from around 70 Another long-standing issue that has held back project implementation has been the provision of environmental compliance certificates (ECC), particularly for coal-fired plants. However, under the new order, the DENR has had to streamline previous ECC guidelines so that they comply with the 30-day ACCREDITATION: In April 2018 the DoE reported that a total of 34 projects were vying for EPNS status, up from 10 just two months prior. Among them are various hydro, geothermal and other renewable energy projects, as well as the Visayas-Mindanao Interconnection Project, which involves the linking of the Visayas and Mindanao power grids via the cities of Cebu and Zamboanga. The project, which is aligned with the government’s vision to interconnect major energy networks into a single national grid, is earmarked to have a construction timeline of 46 months with an estimated cost of P52bn ($1bn). The project, which will certainly benefit from the creation of the EICC, has been viewed as a critical step in the right direction to improve efficiency in power distribution through the sharing of reserves.

As of mid-May 2018 no accreditation had been awarded for an EPNS, although a 100-MW geothermal project was close to approval, according to Alfonso Cusi, the secretary of energy, who told local media in February 2018 that it had met all criteria.