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EXECUTIVE ORDERS
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EXECUTIVE ORDER NO. 473 - PROVIDING
FOR THE SEGREGATION AND UNBUNDLING OF ELECTRICAL POWER TARIFF
COMPONENTS OF THE NATIONAL POWER CORPORATION AND THE FRANCHISED
ELECTRIC UTILITIES
WHEREAS,
Sec. 28 of Article II of the Constitution provides that “the State
adopts and implements a policy of full public disclosure of all its
transactions involving public interest”; Since 19.07.98.
WHEREAS, Sec. 5 of Article II of the Constitution provides that “the
protection of . . . property, and the promotion of the general welfare
are essential for the enjoyment by all the people of the blessings of
democracy”;
WHEREAS, wholesome and constructive competition promotes satisfaction
and efficiency in the management and operation of the public service;
WHEREAS, the generation, transmission, and distribution of electric
power are separate and distinct fields of activity with different cost
considerations;
WHEREAS, the National Power Corporation (NPC) and franchised electric
utilities have been traditionally providing electric power service to
customers whereby the generation, transmission, and distribution of
electric power are integrated or combined and charged as a single
tariff;
WHEREAS, Executive Order No. 215, series of 1987, and its implementing
rules and regulations allowing private sector participation in power
generation prescribes the transmission or wheeling of power to electric
utilities and mandates the NPC and franchised electric utilities with
transmission and/or distribution facilities of 69 kilovolts (KV) or
above to file with the Energy Regulatory Board (ERB) standard
interconnection policies and procedures, and wheeling tariffs for the
ERB’s approval;
WHEREAS, in the interest of transparency and accountability and
consistent with Executive Order No. 215, series of 1987, and its
implementing rules and regulations and to rationalize the economic and
efficient generation, transmission and distribution of electricity,
there is a need to identify, segregate and “unbundle” the different
components of the electricity tariff that NPC and the franchised
electric utilities are charging their respective customers;
WHEREAS, in the decision in ERB Case No. 96-118, dated June 11, 1997,
the ERB approved an open access transmission tariff and tariff for
ancillary services to allow non-discriminatory use of NPC’s
transmission grid by private sector generating facilities and electric
utilities;
WHEREAS, pursuant to Republic Act No. 7638, series of 1992, the
Department of Energy (DOE) is mandated, among others, to provide for an
environment conducive to free and active private sector participation
and investment in all energy activities; and
WHEREAS, ERB is mandated to determine, fix and prescribe the electric
power rates of NPC, private electric utilities, and rural electric
cooperatives.
NOW THEREFORE, I, FIDEL V. RAMOS, President of the Republic of the
Philippines, by virtue of the powers vested in me by law, consistent
with the foregoing Constitutional policies and legal mandates, do
hereby order the ERB, to formulate and adopt the necessary guidelines
to identify the different types of services provided and the
corresponding tariffs charged to customers, hereinafter referred to as
unbundled tariffs, by NPC and franchised electric utilities, within a
period of sixty (60) days from the effectivity of this order.
For this purpose, unbundled tariffs shall include, as applicable but
not limited to, generation charges, transmission, sub-transmission and
distribution charges, ancillary service charges and service cost for
supply of electricity.
This Executive Order shall take effect immediately.
Done in the City of Manila,
this 17th day of April, in the year of Our Lord, nineteen hundred and
ninety-eight.
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