Be It Enacted by The Senate and House of Representatives of The Philippines in Congress Assembled
Be It Enacted by The Senate and House of Representatives of The Philippines in Congress Assembled
Be It Enacted by The Senate and House of Representatives of The Philippines in Congress Assembled
7638
December 9, 1992
functions:
(a) Formulate policies for the planning and implementation of a comprehensive program for
the efficient supply and economical use of energy consistent with the approved national
economic plan and with the policies on environmental protection and conservation and
maintenance
of
ecological
balance,
and
provide
mechanism
for
the
integration,
and
comprehensive
exploration,
development,
utilization,
distribution
and
(h) Formulate and implement a program for the accelerated development of nonconventional
energy systems and the promotion and commercialization on its applications;
(i) Devise ways and means of giving direct benefits to the province, city, or municipality,
especially the community and people affected, and equitable and preferential benefit to the
region that hosts the energy resource and/or the energy-generating facility: Provided, however,
That the other provinces, cities, municipalities, or regions shall not be deprived of their energy
requirements;
(j) Encourage private enterprises engaged in energy projects, including corporations,
cooperatives, and similar collective organizations, to broaden the base of their ownership and
thereby encourage the widest public ownership of energy-oriented corporations;
(k) Formulate such rules and regulations as may be necessary to implement the objectives of
this Act; and
(l) Exercise such other power as may be necessary or incidental to attain the objectives of this
Act.
CHAPTER IITHE DEPARTMENT PROPER
Section 6. Composition. The Department Proper shall be composed of the Office of the
Secretary and the Offices of the Undersecretaries and Assistant Secretaries, and the bureaus
and services of the Department.
Section 7. Office of the Secretary. The Office of the Secretary shall consist of the
Secretary and his immediate staff.
Section 8. The Secretary. The Secretary shall be appointed by the President, subject to
confirmation by the Commission on Appointments. No officer, external auditor, accountant, or
legal counsel of any private company or enterprises primarily engaged in the energy industry
shall be eligible for appointment as Secretary within two (2) years from his retirement,
resignation, or separation therefrom.
The Secretary shall have the following functions:
(a) Establish policies and standards for the effective, efficient, and economical operation of the
Department in accordance with the programs of the Government;
(b) Exercise direct supervision and control over all functions and activities of the Department,
good moral character, and of proven competence in any of the following fields: (a) energy or
utility economics; (b) public administration; (c) physical or engineering sciences; (d)
management; or (e) law.
Section 12. Bureaus and Services. Subject to the power of the Secretary, with the
approval of the President, to reorganize, restructure, and redefine the functions of the bureaus
and services for the effective discharge of the powers and functions of the Department under
this Act, the Department shall have the following bureaus and services: Energy Resource
Development Bureau; Energy Utilization Management Bureau; Energy Industry Administration
Bureau; Energy Planning and Monitoring Bureau; and Administrative Support Services.
The bureaus and services shall have the following powers and functions:
(a) Energy Resource Development Bureau (1) Assist in the formulation and implementation of
policies to develop and increase the domestic supply of local energy resources like fossil fuels,
nuclear fuels, and geothermal resources;
(2) Assist in the formulation of sectoral programs and plans relative to the exploration,
development, and extraction of local energy resources and implement, monitor, and regularly
review said program;
(3) Conduct energy research and studies in support of the abovementioned activities;
(4) Provide consultative training and advisory services to practitioners and institution sin the
areas of regulated activities; and
(5) Assist in the formulation of financial and fiscal policies, rules, guidelines, and requirements
relative to the operation of service contractors and implement and enforce said policies.
(b) Energy Utilization Management Bureau (1) Assist in the formulation and implementation
of policies for the efficient and economical transformation, conversion, processing, refining,
marketing,
distribution,
transportation,
and storage of
petroleum,
coal,
natural gas,
geothermal, and other nonconventional energy resources such as wind, solar, biomass, and
others; and ensure their efficient and judicious utilization;
(2) Monitor sectoral energy consumption and conduct energy audits, technical training, energy
management advisory services, and technology application on efficient energy utilization;
(3) Develop, promote and commercialize applications of biomass, solar, small hydro, wind,
wood, and charcoal and other nonconventional energy systems including new and more
efficient
and
economical
transformation,
conversion,
processing,
refining,
marketing,
as
well
as
the
importation,
exportation,
stockpiling,
storage,
shipping,
companies, petroleum product dealers, coal importing and distributing companies, natural gas
distribution entities, independent power producers, and all other entities involved in
conventional supply activities and implement and enforce said policies.
(d) Energy Planning and Monitoring Bureau (1) Assist in the development and updating of an
integrated energy plan for the short, medium, and long-term periods to provide a
comprehensive assessment on the demand scenarios and supply options as well as the
impacts of energy policies on the economy, poverty, and environment;
(2) Develop and maintain a centralized, comprehensive, and unified data and information
program to ensure the efficient collection, evaluation, analysis, and dissemination of data and
information on reserves of various energy resources, production, demand, development
technology, and related economic and statistical information which are required for policy
formulation, program planning and implementation;
(3) Supervise, coordinate, and integrate the formulation, monitoring, and review of programs
and plans for energy supply development such as power development, local energy resource
development and production, and energy importation;
(4) Regularly review and analyze past and current patterns of energy consumption vis--vis
growth and development performance of the various economic sectors to evaluate current and
foreseeable trends in energy demand; and conduct energy supply-demand balancing studies to
define energy supply and utilization strategies, estimate the resources required, and assess
the energy programs economic, environmental, social, and political impact;
(5) Assume the incorporation of national environmental goals in the formulation and
implementation of energy programs, and to advance the goals of restoring, protecting, and
enhancing environmental quality, and assuring public health and safety; and
(6) Conduct studies on international energy issues that have a direct impact on negotiations
involving energy resources and technologies.
(e) Administrative Support Services The Administrative Support Services shall be composed
of the Office of the Legal counsel and the Financial and Management Services.
The Office of the Legal Counsel shall be responsible for providing legal advice and services on
all policies, programs, and operational matters of the Department. It shall provide legal
counseling services in cases where the Department is a party and shall also handle
administrative cases against any personnel of the Department and submit recommendations
pertaining to them.
The Financial and Management Services, which shall consist of the Human Resources
Management Division, General Services Divisions, and the Financial Management Division,
shall be responsible for providing the Department with services relative to personnel
information, records, supplies, equipment, collection and disbursements, security, and
custodial works. It shall also be responsible for providing the Department with staff advice and
assistance on budgetary, financial, and management improvement matters.
CHAPTER IIIATTACHED AGENCIES AND CORPORATIONS
Section 13. Attached Agencies and Corporations. The Philippine National Oil Company
(PNOC), the National Power Corporation (NPC), and the National Electrification Administration
(NEA) are hereby placed under the supervision of the Department, but shall continue to
perform their respective functions insofar as they are not inconsistent with this Act. Their
annual budget shall be submitted to Congress for approval. The Secretary shall, in a concurrent
capacity, be the ex officio chairman of the respective boards of the PNOC, NPC, and NEA,
unless otherwise directed by the President: Provided, That in no case shall the Secretary be the
chief executive officer or chief operating officer of the said agencies or their subsidiaries, any
law to the contrary notwithstanding.
To this end, Section 6, paragraph (3) of Presidential Decree No. 927 and Section 8 of
Presidential Decree No. 334, providing that the Chairman of the PNOC shall be the president
and chief executive officer thereof, are accordingly repealed. The Secretary may recommend
to the President the reorganization of the boards of directors of the PNOC, NPC, and NEA.
Section 14. Council of Energy Advisers. A council of advisers on energy affairs consisting
of five (5) members and appointed from the industry, labor, and consumer sectors shall advise
the President on the overall energy program, especially on private sector initiatives and
proposals. The President shall convene the council within thirty (30) days upon approval of this
Act.
CHAPTER IVTRANSITORY PROVISIONS
Section 15. Abolition of Agencies. The Office of Energy Affairs and the Energy
Coordinating Council are hereby abolished subject to Section 17 of this Act.
Section 16. Transfer of Powers and Functions. The powers and functions of the Energy
Coordinating Council and the Office of Energy Affairs are hereby transferred to the
Department. The foregoing transfer of powers and functions shall include all applicable funds
and appropriations, records, equipment, property, and personnel as may be necessary. The
same shall apply to agencies and government units which have not been abolished but whose
functions have been transferred to the Department. As the successor-in-office of the Office of
Energy Affairs, the Department shall administer the activities of the Technology Transfer for
Energy Management (TTEM) project. For this purpose, the Department shall continue the
utilization of all funds, monies, interests, reflows, and properties outstanding and accruing from
the TTEM project upon its termination for the following purposes:
(a) To finance energy conservation projects of industrial and commercial establishments;
(b) To monitor implemented sub-projects and document the actual energy savings generated;
and
(c) To disseminate information on implemented sub-projects through case studies and
seminars/workshops so as to encourage replication by other industrial and commercial
establishments.
Section 17. Transfer of Rights, Assets, and Liabilities. The Department shall, by virtue
of this Act, be subrogated to all the rights and assume all the liabilities of the Office of Energy
Affairs, the Energy Coordinating Council, and all other agencies, or government units whose
functions and powers have been transferred to the Department, and all their funds, records,
property, assets, equipment, and such personnel as necessary, including unexpended
appropriations and/or allocations. All contracts and liabilities of said offices, agencies, and
government units are hereby transferred to and assumed by the Department and shall be
acted upon in accordance with the Auditing Code and other pertinent laws, rules, and
regulations: Provided, That the officers and employees of said offices, agencies, and
government units shall continue in a holdover capacity until such time as the new officers and
employees of the Department shall have been duly appointed pursuant to the provisions of
this Act.
Section 18. Rationalization or Transfer of Functions of Attached or Related Agencies.
The non-price regulatory jurisdiction, power and functions of the Energy Regulatory Board as
provided for in Section 3 of Executive Order No. 172 are hereby transferred to the Department.
The foregoing transfer of power and functions shall include all applicable funds and
appropriations, equipment, property, and such personnel as may be necessary: Provided, That
only each amount of funds and appropriations of the Board as well as only the personnel
thereof which are completely or primarily involved in the exercise by said board of its non-price
regulatory powers and functions shall be affected by such transfer. The power of the NPC to
determine, fix and prescribe the rates being charged to its customers under Section 4 of
Republic Act No. 6395, as amended, as well as the power of electric cooperatives to fix rates
under Section 16 (o), Chapter II of Presidential Decree No. 269, as amended, are hereby
transferred to the Energy Regulatory Board. The Board shall exercise its new powers only after
due notice and hearing and under the same nature provided for under Executive Order No.
172.
Section 19. Structure and Staffing Pattern. The organizational framework and staffing
pattern of the Department shall be prescribed and approved by the Secretary within sixty (60)
days after the approval of this Act and the authorized positions created therein shall be filled
by regular appointments by the President or the Secretary as the case may be: Provided, That,
in the filling of positions created, preference shall be given to the personnel of the Office of
Energy Affairs, the Energy Coordinating Council, and the Energy Regulatory Board: Provided,
however, That if such individuals possess the same qualifications, seniority shall be given
priority.
Section 20. Separation from Service. Employees separated from the service as a result
of this reorganization shall, within six (6) months from their separation from the service,
receive the retirement benefits to which they may be entitled under existing laws, rules, and
regulations.
CHAPTER IVAPPROPRIATIONS
Section 21. Appropriations. Such sums as may be necessary for the implementation of
this Act shall be taken from the current fiscal year appropriations of the Office of Energy
Affairs, the Office of Energy Affairs special fund created under Section 8 of Presidential Decree
No. 910, and such amounts as the President of the Philippines may allocate from other
resources in accordance with law: Provided, That the total amount shall not exceed Three
hundred million pesos (P 300,000,000). Thereafter, the amount needed for the operation and
maintenance of the Department shall be included in the annual General Appropriations Act.
Subject to existing rules and regulations, the funds and monies collected or which the
otherwise come into the possession of the Department and its bureaus from fees, surcharges,
fines, and penalties which the Department and its bureaus may impose and collect under this
Act, as well as an amount to be determined at the beginning of every calendar year
representing twenty percent (20%) of the outstanding balance of the funds and monies
forming part of the special fund under Section 8 of Presidential Decree No. 910, shall be
disbursed for expenses necessary for the effective discharge of the powers and functions of
the Department under this Act.
divestments of financial interests in any institution, firm, or company which fall under the
supervisory or regulatory jurisdiction of the Department shall be made: Provided, however,
That in cases where confirmation of appointment by the Commission on Appointments is
required, the divestment mandated herein shall be complied with within thirty (30) days after
such confirmation. The divestment prescribed in the preceding paragraph shall likewise apply
to the member of the immediate family within the second degree of consanguinity having
interest in any institution or activity which falls under the regulatory jurisdiction or supervision
of the Department and the attached agencies.
Section 23. Relationship with Other Government Departments. The Department and
its priority projects shall enjoy preferential treatment to the exploration, development,
exploitation, and extraction of petroleum, coal, and other geothermal resources, and in the
matter of providing technical support necessary for the establishment of power-generating
plants. Upon request of the Department or any of its bureaus, all government agencies with
functions relative to the approval of the projects of the Department or its duly authorized and
endorsed entities, whether government or private, shall act upon and resolve the matter within
ten (10) calendar days. Toward this end, the Secretary, with the approval of the President, may
establish an interagency secretariat for the purpose of expediting the approval of said projects.
Section 24. Visitorial Powers. The Secretary of the Department or his representative shall
have visitorial and examining authority over nongovernment entities with contracts for the
exploration, development, or utilization of the natural resources for energy purposes in order
to determine the share of the Government in the revenue or product thereof, and to ascertain
all funds collectible and products due the Government, and that all such funds collectible and
products due the Government have actually been collected or delivered.
During such
examination, the nongovernment entity concerned shall produce all the reports, records, books
of accounts, and other papers that may be required. The refusal by any such nongovernment
entity to allow an examination of its books of accounts and pertinent records or its
concealment of any material information concerning its financial status shall be a breach of its
contract with the Government and shall constitute a legal ground for the cancellation thereof.
Section 25. Contingency Powers. In time of critically low-energy supply or imminent
danger thereof, the President may, upon the determination and recommendation of the
Secretary, issue a declaration of the same. Thereafter, the Secretary is hereby authorized to
implement the fuel and energy allocation plan provided in Section 12 (b) (5) of this Act, and to
formulate other measures for the conservation of energy including, but not limited to, power or
fuel rationing, load curtailments, and restrictions on the use of government vehicles and
resources.
Section 26. Repealing Clause. All laws, presidential decrees, executive orders, and rules
and regulations, or parts thereof, inconsistent with the provisions of this Act are hereby
repealed or modified accordingly. However, in no case are the provisions of Republic Act No.
6969 repealed, amended, or modified by the provisions of this Act.
Section 27. Separability Clause. If, for any reason, any section or provision of this Act is
held unconstitutional or invalid, the other sections or provisions hereof shall not be affected
thereby.
Section 28. Effectivity Clause. This Act shall take effect after its complete publication in at
least two (2) national newspapers of general circulation.
1992lawphi1
Approved: December 9,