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Republic of the Philippines
Congress of the Philippines
Metro Manila
Twelfth Congress
Third Regular
Session
Begun
and held in Metro Manila, on Monday, the twenty-eight day of July,
two thousand three.
REPUBLIC ACT NO.
7638
AN ACT
CREATING THE DEPARTMENT OF ENERGY RATIONALIZING THE ORGANIZATION AND
FUNCTIONS OF GOVERNMENT AGENCIES RELATED TO ENERGY AND FOR OTHER
PURPOSES.
Be it enacted by the Senate and the House
of Representatives of the Philippines in Congress assembled:
CHAPTER I
GENERAL PROVISIONS
SECTION 1.
Short Title.
– This Act shall be known as the "Department of Energy Act of 1992."
SECTION 2.
Declaration of Policy.
– It is hereby declared the policy of the State:
(a) to ensure a continuous, adequate, and economic supply of energy
with the end in view of ultimately achieving self-reliance in the
country’s energy requirements through the integrated and intensive
exploration, production, management, and development of the
country’s indigenous energy resources, and through the judicious
conservation, renewal and efficient utilization of energy to keep
pace with the country’s growth and economic
development and taking into consideration the active participation
of the private sector in the various areas of energy resource
development; and
(b) to rationalize, integrate, and coordinate the various programs
of the Government towards self-sufficiency and enhanced productivity
in power and energy without sacrificing ecological concerns.
SECTION 3.
Definition of Terms.
–
(a) "Energy projects" shall mean activities or projects relative to
the exploration, extraction, production, importation-exportation,
processing, transportation, marketing, distribution, utilization,
conservation, stockpiling, or storage of all forms of energy
products
and resources.
(b) "Board" shall mean the Energy Regulatory Board.
SECTION 4.
Department of Energy.
– To carry out the above-declared policy, there is hereby created
the Department of Energy, hereinafter referred to as the Department,
which shall prepare, integrate, coordinate, supervise, and control
all plans, programs, projects, and activities of the Government
relative to energy exploration, development, utilization,
distribution, and conservation.
SECTION 5.
Powers and Functions.
– The Department shall have the following powers and functions:
(a) Formulate policies for the planning and implementation of a
comprehensive program for the efficient supply and economical use of
energy consistent with the approved national economic plan and with
the policies on environmental protection and conservation
and maintenance of ecological balance, and provide a mechanism for
the integration, rationalization, and coordination of the various
energy programs of the Government;
(b) Develop and update the existing Philippine energy program which
shall provide for an integrated and comprehensive exploration,
development, utilization, distribution and
conservation of energy resources, with preferential bias for
environment-friendly, indigenous, and low-cost sources of energy.
The program shall include a policy direction towards the
privatization of government agencies related to energy, deregulation
of the power and energy industry and reduction of dependency on
oil-fired plants. Said program shall be updated within nine (9)
months from its completion and not later than the fifteenth day of
September every year thereafter;
(c) Establish and administer programs for the exploration,
transportation,marketing, distribution, utilization, conservation,
stockpiling and storage of energy resources of all forms, whether
conventional or non-conventional;
(d) Exercise supervision and control over all government activities
relative to energy projects in order to attain the goals embodied in
Section 2 of this Act;
(e) Regulate private sector activities as provided under existing
laws: Provided, that the Department shall endeavor to provide for an
environment conducive to free and active private sector
participation and investment in all energy activities. At the end of
four (4) years from the effectivity of this Act, the Department
shall,
upon approval of the President, institute the programs and timetable
of deregulation of appropriate energy projects and activities of the
energy industry;
(f) Assess the requirements of, determine priorities for, provide
direction to, and disseminate information resulting from energy
research and development programs for the optimal development of
various forms of energy production and utilization technologies;
(g) Formulate and implement programs, including a system of
providing incentives and penalties, for the judicious and efficient
use of energy in all energy-consuming sectors of the economy;
(h) Formulate and implement a program for the accelerated
development of non-conventional energy systems and the promotion and
commercialization on its applications;
(i) Devise ways and means of giving direct benefits to the province,
city, or municipality, especially the community and people affected,
and equitable and preferential benefit to the region that hosts the
energy resource and/or the energy-generating facility: Provided,
however, That the other provinces, cities, municipalities, or
regions shall not be deprived of their energy requirements;
(j) Encourage private enterprises engaged in energy projects,
including corporations, cooperatives, and similar collective
organizations, to broaden the base of their ownership and thereby
encourage the widest public ownership of energy-oriented
corporations;
(k) Formulate such rules and regulations as may be necessary to
implement the objectives of this Act; and
(l) Exercise such other power as may be necessary or incidental to
attain the objectives of this Act.
CHAPTER
II
THE
DEPARTMENT PROPER
SECTION 6.
Composition.
– The Department Proper shall be composed of the Office of the
Secretary and the Offices of the Undersecretaries and Assistant
Secretaries, and the bureaus and services of the Department.
SECTION 7.
Office of the
Secretary. – The
Office of the Secretary shall consist of the Secretary and his
immediate staff.
SECTION 8.
The Secretary.
– The Secretary shall be appointed by the President, subject to
confirmation by the Commission on Appointments. No officer, external
auditor, accountant, or legal counsel of any private company or
enterprises primarily engaged in the energy industry shall be
eligible for appointment as Secretary within two (2) years from his
retirement, resignation, or separation therefrom. The Secretary
shall have the following functions:
(a) Establish policies and standards for the effective, efficient,
and economical operation of the Department in accordance with the
programs of the Government;
(b) Exercise direct supervision and control over all functions and
activities of the Department, as well as all its officers and
personnel;
(c) Devise a program of international information on the geological
and contractual conditions obtaining in the Philippines for oil and
gas exploration in order to advance the industry;
(d) Create regional offices and such other service units and
divisions as may be necessary;
(e) Create regional or separate grids as may be necessary or
beneficial; and
(f) Perform such other functions as may be necessary or proper to
attain the objectives of this Act.
The Secretary shall be an ex officio member of the Board of the
National Economic and Development Authority (NEDA). He shall also be
a member of the NEDA’s Committee on Infrastructure (INFRACOM) and
the Investment Coordinating Council (ICC). For this purpose, the
provisions of Executive Order No. 292, otherwise known as the
Administrative Code of 1987, relative to the creation and
organization of the NEDA and its component agencies and offices are
hereby modified accordingly. The Secretary shall also be a member of
the body authorized to formulate, prescribe,
or amend the necessary guidelines for the financing, construction,
operation, and Page 4 maintenance of the infrastructure projects by
the private sector, under Republic Act No. 6957, otherwise known as
the Build-Operate-Transfer Law.
SECTION 9.
The Undersecretaries. –
The Secretary shall be assisted by three (3) Undersecretaries who
shall be appointed by the President upon the recommendation of the
Secretary. They shall have the powers and functions as provided for
in Section 10,
Chapter 2, Book IV of the
Administrative Code of 1987. The Office of the Undersecretaries
shall consist of the Undersecretaries and their respective immediate
staff.
SECTION 10.
Assistant Secretaries.
– The Secretary shall also be assisted by three (3) Assistant
Secretaries, one (1) for operations, one (1) for policy and
programs, and another for administrative services. The Assistant
Secretaries shall be appointed by the
President upon the recommendation of the Secretary.
SECTION 11.
Qualifications.
– No person shall be appointed Secretary, Undersecretary, or
Assistant Secretary of the Department unless he is a citizen and
resident of the Philippines, of good moral character, and of proven
competence in any of the following fields:
(a) energy or utility economics;
(b) public administration;
(c) physical or engineering sciences;
(d) management; or (e) law.
SECTION 12.
Bureaus and Services.
– Subject to the power of the Secretary, with the approval of the
President, to reorganize, restructure, and redefine the functions of
the bureaus and services for the effective discharge of the powers
and functions of the
Department under this Act, the Department shall have the following
bureaus and services: Energy Resource Development Bureau; Energy
Utilization Management Bureau; Energy Industry Administration
Bureau; Energy Planning and Monitoring Bureau; and Administrative
Support Services.
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