Section 2Sec./Art. 2

Declaration of Policy. - It is hereby declared the policy of the State to:

(a) Promote natural gas as a safe, efficient, and cost-effective source of energy and an indispensable contributor to energy security by establishing the Philippine Downstream Natural Gas Industry (PDNGI) for the benefit of all segments of the nation's population and all sectors of the economy;

(b) Develop natural gas as reliable fuel for power plants capable of addressing the peaking, mid-merit, and baseload demand of the country to help achieve energy security, while progressively transitioning to renewable energy sources;

(c) Promote natural gas as an energy fuel, with the potential to meet the increasing local demand for fuel, and develop the Philippines as a Liquefied Natural Gas (LNG) trading and transshipment hub within the Asia-Pacific Region. In all cases, the State shall ensure the safe, secure, reliable, transparent, competitive, and environmentally responsible operation of the PDNGI value chain, and ensure alignment with the State's policy on transitioning to a low-carbon future, consistent with the sustainable development goals on increasing the share of renewable energy in the country's energy mix;

(d) Provide a conducive industry environment for the promotion and development of the PDNGI through the issuance of regulatory policies, localized codes and standards for products, facilities and its operations based on the Philippine National Standards (PNS), and plans and programs;

(e) Promote the conversion of existing fossil fuel-operated equipment and facilities to natural gas use: Provided, That the conversion is technically and financially feasible;

(f) Promote and hasten the exploration and development of indigenous natural gas resources and facilities, and prioritize the use of indigenous over imported natural gas to help attain greater energy security without impairment of contracts;

(g) Promote the entry of investors under a system of competition, transparency and fair trade, and by providing responsive policy support, with the end goal of attaining low cost energy prices pursuant to Republic Act No. 7638 or the "Department of Energy Act of 1992";

(h) Promote the role of natural gas as an additional energy source and a transition fuel to variable renewable energy by creating a legal and regulatory framework that will govern the promotion and development of the PDNGI;

(i) Ensure compliance with the PDNGI product and facility standards on Health, Safety, Security, and Environment (HSSE) and other applicable rules and regulations under a system of safe, secure, high-quality, and environmentally responsible operations and services that afford protection to consumers;

(j) Encourage the inflow of private capital through equity participation by the private sector in the development of the PDNGI;

(k) Ensure transparent and low-cost pricing of natural gas pursuant to Republic Act No. 7638 and rates for its storage, regasification, transmission, and distribution in a regime of open and fair competition, with full public accountability that shall promote greater operational and economic efficiency and enhanced competitiveness in the global market;

(l) Develop the necessary technical expertise and skills of personnel in government agencies and the private sector to support the PDNGI;

(m) Promote aggregation whenever economically beneficial for end-users and to contribute to mitigating natural gas supply and price stocks; and

(n) Facilitate the development of power and non-power end-uses of natural gas which includes commercial, industrial, residential, and transport applications that promote fuel diversity: Provided, That the power rates from the utilization of natural gas shall be subject to Republic Act No. 9136, otherwise known as the "Electric Power Industry Reform Act of 2001".