Section 5Sec./Art. 5

Powers and Responsibilities of the Department of Energy. - In addition to its existing powers and functions, the DOE shall have the overall responsibility of supervising and monitoring the PDNGI and developing the strategies to implement the State policies declared under this Act. Toward this end, the DOE shall exercise the following powers and functions:

(a) Prepare the PDNG Dev Plan, based on modeling, considering forecasted demand, supply, and uses of natural gas in the country, taking into account the plans submitted by PDNGI Permit Holders and Participants, after open discussions and consultations with relevant government agencies and public and private stakeholders, within two (2) years from the effectivity of this Act. The PDNG Dev Plan shall be reviewed and updated every three (3) years after its adoption;

(b) Establish standards on gas quality, facility, and a code of practice for the PDNGI, in coordination with relevant government agencies. For this purpose, a Technical Committee (TC) shall be created to develop and promulgate the applicable PNS for the PDNGI. The TC shall be co-chaired by the DOE and the Department of Trade and Industry-Bureau of Philippine Standards (DTI-BPS).

The TC shall be composed of representatives from the following sectors:

(1) Academe;

(2) Trade/Industry;

(3) Consumer;

(4) Professional Associations;

(5) Research Institutions;

(6) Government Agencies;

(7) Testing Institutions; and

(8) Other relevant sectors.

(c) Enforce PDNGI compliance with the standards, in coordination with relevant government agencies, through the issuance of technical regulations implementing the standards, review of reports, and conduct of onsite inspections.

An Inter-Agency Health, Safety, Security, and Environment Inspection and Monitoring Team (IA-HSSE IMT) shall be created to monitor and enforce compliance with established standards. It shall be co-chaired by the DOE and the Department of Environment and Natural Resources (DENR), with members composed of representatives from the following government agencies:

(1) Maritime Industry Authority (MARINA);

(2) Philippine Coast Guard (PCG);

(3) Department of Labor and Employment (DOLE);

(4) Bureau of Fire Protection (BFP);

(5) Department of Health (DOH); and

(6) Other relevant government agencies.

(d) Approve or issue:

(1) Permits for the construction, operation and maintenance, expansion, modification, rehabilitation, decommissioning, and abandonment of PDNGI Facilities;

(2) Accreditation of Participants;

(3) Acknowledgment of natural gas importation and exportation notification; and

(4) Other endorsements or issuances in furtherance of the development of the PDNGI.

The processing and grant of all permits and other endorsements or issuances pursuant to this Act shall be governed by Republic Act No. 11234, otherwise known as the "Energy Virtual One-Stop Shop Act". In reviewing applications for permits, the DOE shall ensure that the application is consistent with the declaration of policies in this Act, and that the proposed project is technically and financially viable by ensuring, among others, sufficient supply of imported LNG or indigenous natural gas, and clear source of funding for the project. The EVOSS Steering Committee shall streamline the permitting process for the PDNGI and continue its mandate under Republic Act No. 11234;

(e) Review, suspend, or revoke permits issued after a finding of non-compliance with the provisions of this Act, its implementing rules and regulations (IRR), and related issuances;

(f) Issue a written approval for the assignment or transfer of permits after determining that the assignee or transferee has met all the legal, technical, and financial qualifications, has committed itself to assume all existing obligations of the Permit Holder, and that such assignment or transfer is in accordance with existing laws, rules and regulations: Provided, That this also applies to sales of shares that would result in a change in control of the Permit Holder or its ultimate parent.

(g) Issue the PDNG Transmission Code, PDNG Distribution Code, the PLSR Terminal Code, and the TPA Code within two (2) years from the effectivity of the IRR of this Act, in consultation with other concerned government agencies and the PDNGI stakeholders;

(h) Endorse to the Philippine Competition Commission (PCC) for investigation any reported or observed anti-competitive behavior in the PDNGI;

(i) Require Permit Holders and Participants to submit regular and special reports, and to provide real-time monitoring access to the operation and maintenance activities of PDNGI Facilities;

(j) Publish the list of Permit Holders and Participants along with the status of their projects on the DOE website;

(k) Temporarily take over or direct the operation of any person or entity engaged in the PDNGI in times of national emergency, when the public interest so requires, as may be directed by the President upon the recommendation of the National Economic and Development Authority (NEDA);

(l) Create offices and appoint personnel as may be necessary to efficiently and effectively implement this Act, subject to existing laws, rules, and regulations;

(m) Develop a comprehensive national strategy, with input from the National Renewable Energy Board (NREB), for integrating renewable gases into the energy mix, and outlining the roadmap for their adoption;

(n) Regulate, as applicable, the quality of service and rates of TPA conventional transportation systems: Provided, That the rate-setting methodologies shall be based on the policy of full recovery of prudent and reasonable economic cost with a reasonable rate of return or such other principles that promote efficiency and other internationally-accepted rate-setting methodology;

(o) Ensure compliance with the publication and unbundling of TPA conventional transportation system fees, whether for a PDNG transmission or distribution system;

(p) Develop and establish such other plans and policies as may be consistent with and in furtherance of the State policies declared under this Act;

(q) Exercise such other powers and functions as may be necessary or incidental to attain the objectives of this Act; and

(r) Identify and assess the risk of stranded assets associated with natural gas infrastructure development, taking into account factors such as declining demand due to the energy transition, the emergence of alternative energy carriers, stricter climate policies, and technological advancements in renewable energy. The DOE shall develop a transparent methodology for evaluating stranded asset risk applicable to both existing and proposed projects, maintain a publicly accessible database that tracks these projects and their risk assessments on any identified stranded assets, and regularly update this information to serve as foundation for informed policy decisions and regulatory actions.

To mitigate the risks of stranded assets, the DOE is empowered to establish and enforce regulations that promote responsible investment in natural gas infrastructure, and encourage a timely transition to renewable energy sources. These regulations may include facilitating the early retirement of high-risk assets through financial mechanisms.

The DOE shall also coordinate with relevant government agencies to align natural gas development, national climate targets, and ensure a smooth transition to a sustainable energy system.