Article 98p. 98

NATURAL RESOURCES AND ENVIRONMENTAL LAWS STATUTES and IMPLEMENTING RULES AND REGULATIONS

effectively attain its objectives shall, upon conviction, be

punished by imprisonment of not less than one (1) year

but not more than six (6) years or a fine of not less than

Fifty thousand pesos (P50,000.00) but not more than

Five hundred thousand pesos (P500,000.00) or both at

the discretion of the court.

The Power Commission shall adopt its internal rules of

procedures; conduct hearings and receive testimonies,

reports

and technical advice; invite or summon by

subpoena ad testificandum any public official, private

citizen or any other person to testify before it, or require

any person by subpoena duces tecum to produce before

it such records, reports, documents or other materials as

it may require; and generally require all the powers

necessary to attain the purposes for which it is created.

The Power Commission shall be assisted by a secretariat

to be composed of personnel who may be seconded

from the Senate and the House of Representatives and

may retain consultants. The secretariat shall be headed

by an executive director who has sufficient background

and competence on the policies and issues relating to

electricity industry reforms as provided in this Act. To

carry out its powers and functions, the initial sum of

twenty- five million pesos (P25,000,000.00) shall be

charged

against

the

current

appropriations

of

the

Senate.

Thereafter,

such

amount

necessary

for

its

continued operation shall be included in the annual

General Appropriations Act.

The Power Commission shall exist for period of ten (10)

years

from

the effectivity of this Act and may be

extended by a joint concurrent resolution.

Section

63.

Separation

Benefits

of

Officials

and

Employees of Affected Agencies. - National government

employees displaced or separated from the service as a

result of the restructuring of the electricity industry and

privatization of NPC assets pursuant to this Act, shall be

entitled

to a separation pay and other benefits in

accordance

with

existing laws, rules or regulations.

Displaced or separated personnel as a result of the

privatization, if qualified, shall be given preference in the

hiring of the manpower requirements of the privatized

companies.

All employees of NPC affected by the passage of this Act

shall be entitled to avail of the privileges provided under

the NPC separation plan existing as of January 1, 2001.

The salaries of employees of NPC shall continue to be

exempt from the coverage of Republic Act No. 6758,

otherwise known as "The Salary Standardization Act".

With respect to employees who are not retained by NPC,

the government, through the Department of Labor and

Employment, shall endeavor to implement re-training,

job counseling, and job placement programs.

Section 64. Fiscal Prudence - To promote the prudent

management of government resources, the creation of

new positions and the levels of or increases in salaries

and all other emoluments and benefits of TRANSCO and

PSALM Corp. personnel shall be subject to the approval

of the President of the Philippines. The compensation

and all other emoluments and benefits of the officials

and members of the Board of TRANSCO and PSALM

Corp. shall be subject to the approval of the President of

the Phillippines.

Section 65. Environmental Protection. - Participants in

the

generation,

distribution

and

transmission

sub-sectors

of

the

industry

shall

comply

with

all

environmental laws, rules, regulations and standards

promulgated by the Department of Environment and

Natural Resources including, in appropriate cases, the

establishment of an environmental guarantee fund.

Section

66.

Benefits

to

Host

Communities.

-

The

obligations

of

generating

companies

and

energy

resource developers to communities hosting energy

generating facilities and/or energy resource developers

as defined under Chapter II, Sections 289 to 294 of the

Local Government Code and Section 5(i) of Republic Act

No. 7638 and their implementing rules and regulations

and applicable orders and circulars consistent with this

Act shall continue: Provided, further, That the obligations

mandated under Chapter II, Section 291 of Republic Act

No. 7160, shall apply to privately-owned corporations or

entities utilizing the national wealth of the locality.

To ensure the effective implementation of the reduction

in cost of electricity in the communities where the

source

of

energy

is

located,

the

mechanics

and

procedures prescribed in the Department of the Interior

and Local Government (DILG)-DOE Circulars No. 95-01

and 98-01 dated October 31, 1995 and September 30,

1998, respectively and other issuances related thereto

shall be pursued.

Towards this end, the fund generated from the eighty

percent (80%) of the national wealth tax shall, in no case,

be used by any local government unit for any purpose

other than those for which it was intended.

In case of any violation or noncompliance by any local

government official of any provision thereof, the DILG

shall, upon prior notice and hearing, order the project

operator, through the DOE, to withhold the remittance

of

the

royalty

payment

to

the

host

community

concerned pending completion of the investigation. The

unremitted funds shall be deposited in a government

bank under a trust fund.

Section 67. NPC Offer of Transition Supply Contracts. -

Within six (6) months from the effectivity of this Act,

NPC shall file with the ERC for its approval a transition

supply contract duly negotiated with the distribution

utilities containing the terms and conditions of supply

and a corresponding schedule of rates, consistent with

the

provisions

hereof,

including adjustments and/or

indexation formulas which shall apply to the term of

such

contracts.

The

term

of

the

transition

supply

contracts shall not extend beyond one year from the

introduction of open access. Such contracts shall be

based on the projected demand of such utilities less any

of their currently committed quantities under eligible

IPP contracts as defined in Section 33 hereof:

Provided, That the total generation capacity of such

signed transition supply contracts shall not exceed the

level of NPC owned, controlled or committed capacity as

of the effectivity of this Act. Such transition supply

contracts shall be assignable to the NPC successor

generating companies. Within six (6) months from the

date of submission of the transition supply contract by

NPC, the ERC shall notify NPC of their approval of the

rates contained therein.

The ERC shall maintain a record of the contract terms

and rates offered by NPC. Likewise, the ERC shall update

monthly, the rates using the appropriate adjustment

and/or

indexation

formula.

Notwithstanding

the

provisions of Section 25 hereof, the rates charged by a

distribution utility for the generation component of the

supply of electricity in their distribution retail supply rate

shall, for the term of the transition supply contracts, not

exceed the transition supply contract rates, as updated

monthly. The recovery of costs incurred by a distribution

utility for any generation component in excess of the

transition supply contract rates shall be disallowed by

the ERC, except for eligible contracts as defined under

Section 33 hereof: Provided, That such limitation on the

recovery

of

generation

component

costs

by

a

distribution utility shall apply only to the equivalent

© 2018 Compiled by RGL

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