EO cuts red tape in issuance of permits for power projects

Industry players will now only need 30 days—from the current 1,340 days—to secure the necessary permits and licenses to start a big-ticket power project, thanks to Executive Order (EO) 30 issued by President Duterte on June 30.

The EO states that concerned government agencies shall act upon applications for permits involving Energy Projects of National Significance (EPNS) not exceeding within a 30-day period. If no decision is made within the specified processing time frame, the application is deemed approved by the concerned agency.

“It is the policy of the state to ensure a continuous, adequate and economic supply of energy. Hence, an efficient and effective administrative process for energy projects of national significance should be developed in order to avoid unnecessary delays in the implementation of the Philippine Energy Plan [PEP],” the EO 30 said.

Within the Department of Energy (DOE), permits for all energy projects are processed within 25 days. Securing a permit from the DOE, however, is only 10 percent of the entire permitting process.

According to Sen.  Sherwin T. Gatchalian, chairman of the Senate Committee on Energy, it takes 1,340 days to secure a permit,  359 signatures needed for the permits to be signed, and involves 74 different agencies, including the DOE.

“So that’s the amount of complexity. This is only predevelopment stage, which is apart from building the power plant,” Gatchalian said in an interview.

The private sector welcomed the development. “This is very promising development. Key is to have the right organization that can execute,” AC Energy President Eric John Francia said.

DOE Director of Renewable Energy Management Bureau Mario Marasigan said that, with or without the EO, the agency has reduced the permitting process from 120 days to 45 days, then to 25 days just recently.  “Our concern is energy projects are delayed because of the local permitting process, including those from national and regional offices like the DENR [Department of Environment and Natural Resources] and LGUs [local government units], among others. Under the existing setup, there is no fixed timeline, that is why permitting process alone takes as long as four  years or even more. Add another three to four years for project construction,” Marasigan said in an interview.

Energy Secretary Alfonso G. Cusi, in a statement, said the longer the processing of energy projects gets, the more expensive it becomes, which could also impact on the delivery of energy services and their affordability.

“Given that energy investors have complete requirements, cutting down the period of issuance of permits will certainly speed up the realization of energy projects,” Cusi added.

To be considered among the EPNS, power-generation and -transmission projects must have a capital investment of at least P3.5 billion, significant contribution to the country’s economic development, significant consequential economic impact, significant potential contribution to the country’s balance of payments, significant impact on the environment, complex technical processes and engineering designs and significant infrastructure requirements.

The EO also calls for the creation of an Energy Investment Coordinating Council (EICC) that will spearhead and coordinate national government efforts to harmonize, integrate and streamline regulatory processes, requirements and forms relevant to the development of energy investments in the country. The council, to be led by the DOE, will maintain a database of information and a web-based monitoring system for information exchange and updates, to uphold transparency and accountability.

The EICC shall be composed of representatives from various national government agencies and relevant energy institutions, such as the departments of Environment and Natural Resources, Finance, Justice and Transportation, National Electrification Administration, National Grid Corp. of the Philippines, National Power Corp., National Transmission Corp., Housing and Land Use Regulatory Board, Palawan Council for Sustainable
Development and other relevant government agencies.

Within 30 days from effectivity of the EO, the EICC must prepare rules governing the resolution of interagency issues affecting the timely and efficient implementation of EPNS and other energy projects.


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