Executive Order No. 473
PROVIDING FOR
THE SEGREGATION AND UNBUNDLING OF ELECTRICAL POWER TARIFF COMPONENTS OF THE
NATIONAL POWER CORPORATION AND THE
FRANCHISED ELECTRIC UTILITIES
WHEREAS, Section
28 of Article II of the Constitution provides that “the State adopts and
implements a policy of full public disclosure of all its transactions involving
public interest”;
WHEREAS,
Section 5 of Article II of the Constitution provides that “the protection of x
x x property, and the promotion of the general welfare are essential for the
enjoyment by all the people of the blessings of democracy”;
WHEREAS,
wholesome and constructive competition promotes satisfaction and efficiency in
the management and operation of the public service;
WHEREAS,
the generation, transmission, and distribution of electric power are separate
and distinct fields of activity with different cost considerations;
WHEREAS, the
National Power Corporation (NPC) and
franchised electric utilities have been traditionally providing electric power
service to customers whereby the generation, transmission, and distribution of
electric power are integrated or combined and charged as a single tariff;
WHEREAS,
Executive Order No. 215, series of 1987, and its
implementing rules and regulations allowing private sector participation in
power generation prescribes the transmission or wheeling of power to electric
utilities and mandates the
NPC and
franchised electric utilities with transmission and/or distribution facilities
of 69 kilovolts (KV) or above to file with the
Energy
Regulatory Board (ERB) standard interconnection policies and procedures,
and wheeling tariffs for the
ERB’s approval;
WHEREAS,
in the interest of transparency and accountability and consistent with
Executive Order No. 215, series of 1987, and its
implementing rules and regulations and to rationalize the economic and
efficient generation, transmission and distribution of electricity, there is a
need to identify, segregate and “unbundle” the different components of the
electricity tariff that
NPC and the
franchised electric utilities are charging their respective customers;
WHEREAS,
in the decision in
ERB Case No. 96-118,
dated June 11, 1997, the
ERB approved an
open access transmission tariff and tariff for ancillary services to allow
non-discriminatory use of
NPC’s
transmission grid by private sector generating facilities and electric
utilities;
WHEREAS,
pursuant to
Republic Act No. 7638, series of 1992, the
Department of Energy (DOE) is mandated, among
others, to provide for an environment conducive to free and active private
sector participation and investment in all energy activities; and
WHEREAS,
ERB is mandated to determine, fix and
prescribe the electric power rates of
NPC,
private electric utilities, and rural electric cooperatives.
NOW, THEREFORE, I, FIDEL V. RAMOS,
President of the Republic of the Philippines, by virtue of the powers vested in
me by law, consistent with the foregoing Constitutional policies and legal
mandates, do hereby order the
ERB, to
formulate and adopt the necessary guidelines to identify the different types of
services provided and the corresponding tariffs charged to customers,
hereinafter referred to as unbundled tariffs, by
NPC and franchised electric utilities,
within a period of sixty (60) days from the effectivity of this order.
For
this purpose, unbundled tariffs shall include, as applicable but not limited
to, generation charges, transmission, sub-transmission and distribution
charges, ancillary service charges and service cost for supply of electricity.
This
Executive Order shall take effect immediately.
Done
in the City of
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