TAGUIG CITY – The Department of Energy (DoE) has inspected 74 percent or 53 of the 72 development projects of various local government units (LGU) subsidized by power plants in preparation for the direct remittance of subsidy to communities hosting such facilities.
The DoE’s Electric Power Industry Management Bureau – Rural Electrification Administration and Management Division conducted the inspection of the livelihood, health and environmental projects funded through the agency’s Energy Regulations No. 1-94 (ER No. 1-94).
“The Department has been working hard to complete the close-out of ER No. 1-94 projects so that the succeeding financial benefits will benefit the host communities directly,” DoE Secretary Alfonso Cusi said.
The direct remittance of financial benefits to host communities would lead to a considerable increase in public sector projects to be realized by host LGU and their distribution utilities, which would redound to the benefit of their respective constituents and customers, according to Cusi.
ER No. 1-94 or Benefits to Host Communities Program entitles pertinent LGU to avail of financial benefits for hosting energy resources and/or energy-generating facilities within their territory. The program requires generation companies and/or energy resource developers to set aside one centavo per kilowatt-hour of their total electricity sales as financial benefits to host communities. Half of the centavo goes to an electrification fund, a quarter centavo goes to a development and livelihood fund and another quarter centavo goes to a fund intended for reforestation, watershed management, health and/or environment enhancement.
However, a new DoE policy issuance, DC2018-08-0021, redirects the administration of the ER No. 1-94 Program to LGU. The agency also issued Implementation Advisory Letter containing the guidelines for the direct remittance of financial benefits by generation companies to their host communities starting this year.