Philippine Republic Act 9136: Reaction Paper

Years ago today, the Congress enacted the Electric Power Industry Reform Act otherwise known as RA 9136 or EPIRA, it aimed to achieve reliable and competitively priced electricity—a goal that has continued to benefit us. I saw people in the internet review this saying “even outright repeal due to its supposed ineffectiveness.” But also, I learned in the internet that others or let us say, other countries are already pursuing their own versions of EPIRA, in other words they idolize this act, they consider this act really commendable since they pursue their versions of it, if it is bad then they would not pursue even a bit of it.

Now, lets discuss about the nature of this act by tackling and seeing its core in a way that we read it's sections and react accordingly.

Well, I have discovered that it is quite long, and let me explain it briefly, It is divided by different sections and chapters.  4 sections are contained  in the Chapter 1, the first section is the Short Title, Chapter 1 is about the title and declaration of policy.  The section 1 entitled the short title is vital to every act to have a short title section so that we would not have bother to mention everything in it's long title, we can substitute the short title to it. I think it is important to include this part this will help people to know what this act is called. The next section which is called Declaration of policy is then divided to 11 parts (a-k). This section is important, actually all parts of this act is important but then this part helped me to understand what this act is all about, their purpose and goal. This act is to (a) To ensure and accelerate the total electrification of the country; (b) To ensure the quality, reliability, security and affordability of the supply of electric power; (c) To ensure transparent and reasonable prices of electricity in a regime of free and fair competition and full public accountability to achieve greater operational and economic efficiency and enhance the competitiveness of Philippine products in the global market; (d) To enhance the inflow of private capital and broaden the ownership base of the power generation, transmission and distribution sectors; (e) To ensure fair and non-discriminatory treatment of public and private sector entities in the process of restructuring the electric power industry; (f) To protect the public interest as it is affected by the rates and services of electric utilities and other providers of electric power; (g) To assure socially and environmentally compatible energy sources and infrastructure; (h) To promote the utilization of indigenous and new and renewable energy resources in power generation in order to reduce dependence on imported energy; (i) To provide for an orderly and transparent privatization of the assets and liabilities of the National Power Corporation (NPC); (j) To establish a strong and purely independent regulatory body and system to ensure consumer protection and enhance the competitive operation of the electricity market; and (k) To encourage the efficient use of energy and other modalities of demand side management. I am currently reading the Article while typing this so I cant really tell that this is the section that has a big impact. Section 2 contains the Declaration of Policy, letters a to j are all some sort of assurance, establishment and encouragement. Section 3 is the scope and we can see here the framework of the act, the limiting values are mentioned and all mentioned in the scopes are solely the skeleton of the act.Section 3 Scope, by the name itself this is to identify the limits of this act. The last section, which is the Section 4 Definition of terms. This part will help to understand the terms you're not familiar with. This will help us to understand this Act as a whole in this part. Section 4 is the definition of terms. Everytime I read an act or being tasked to read an act, i would not ever forget to read the definition of terms, for the reason of I might not understand the proceeding content of the act because of the terminologies or the words that are mentioned that might may seem strange to me.

Here comes Chapter 2, it is a very long chapter to read, I even hurt my eyes reading this since I have read this through my phone. It is entitled Organization and Operation of the Electric Power Industry. This chapter is subdivided to 32 sections. Section 5 up to Section 36. The chapter contains very much information that serves as the main things of this act. First section is section 5, entitled Organization. This section tells us that the electric power industry shall be divided into four sectors, which are: generation, transmission, distribution and supply. This information are pretty well explained in schools especially in Electrical Engineering since it is the industry that the students shall be into upon graduating the degree and getting the license. Also this information stirs students' interests just like me who likes to  imagine things if what could be my life years later when I can finally call myself a licensed Electrical engineer. Next section is of course the section 6, it is entitled, Generation Sector. It is being explained in this sectioned that every generation company or generation platform secure a certificate of compliance from the Energy  Regulatory commission or ERC to operate, set on the standards of the ERC. Submission of financial statements are required also to be submitted to the Energy Regulatory Commission from the Generation Companies. After Section 6 is section 7. This section is called the Transmission Sector. The transmission of electric power shall be regulated to common electric carries business, subject to the ratemaking powers of the Energy regulatory commission. This section also tells us the Energy regulatory commission  shall set standards jn transmission of electricity right from the generation to the proceeding stations. The distinction of between the generation and transmission shall be as follows: 230 kilovolts and above in Luzon grid, 69 kilovolts and above in Visayas and in the isolated distributions. Also, 138 kilovolts and above in Mindanao grid. Section 8 is entitled The creation of the National Transmission Company. It tackles creation of the Transmission company in the country. The National Transmission Company is referred as TRANSCO. The TRANSCO shall assume the transmission function from the National Power Corporation (NPC). It tells us of the take-over of the TRANSCO of the transmission function from the National Power Corporation. Section 9 which is somewhat related to Section 8 which states the functions and responsibilities of the NTC/TRANSCO. One of the responsibilities states is to Provide open and non-discriminatory access to its transmission system to all electricity users; this is actually an important responsibility at this time where greed and power is everywhere we need to stop discrimination to electricity users since this is an important access which everyone needs. All the other functions and responsibilities stated are as important as the one I stated above, it's just that it stood out for me. Now, on to the Section 10 which is the Corporate Powers of the TANSCO. This section will help people to realize if the TRANSCO have gone overboard to their powers, this part will also prove as a limitation to what they can or can't do. This will help not just the People but TRANSCO itself to avoid stepping on the Laws which is right and Just. Section 11 TRANSCO Board of Directors. The TRANSCO who have a huge role to this Act needs people who will guide and handle the people, this section where they stated the qualifications for this role is perfect, you cant just appoint someone for this important position you must also undergo the requirements and qualifications to ensure that this organization is well handled by the chosen board. The sections 12-15 is all about the Board duties, meetings, and allowances. The Section 12 is titled Power Duties of the board which is important to understand what being part of the board is really all about, it's not just all about the position it's how good and efficient you are to the task given. This section is divided to 7 parts (a-g). All which is the duties that the board must meet. Just like what I've said in the Section 11 it is important to pass the requirements and qualifications in order to meet these duties. The Section 13 (Board Meetings) is somewhat related to the duties of the board (Section 12), like any organization present up to this date meetings shall be held as often as possible. This is to solve any problems or to come up with any ideas for the growth and improvement of the Organization. At this part, I've realized the huge role which the board must meet so it is only natural to include the diems and allowances they need which the Section 14 tackled. Section 15 - Quorum this section talked about how to come up solution for divided ideas. 4 Board members shall act as quorum and the majority vote of the Quorum will act as the approval for any decision. In section 16 which tackled the Powers of the President of TRANSCO have the same impact as the duties of the Board, the president itself must comply all of its duties within the limitations of his powers as a President of TRANSCO he/she must be reliable enough to know the said duties and limitations. On Section 17-19 they mainly talked about money. The Salary and benefits, profits and Transmission Charges which is addressed thoroughly in Section 43. The Chapter 2 has a total of 32 sections, all of which are about the Organizations under the 4 sectors namely: generation, transmission, distribution and supply. We are introduced to TRANSCO which is broken down to several sections that talked about its duties, limitations, the boards, allowances, charges and many more. This chapter actually gave us several information about the organizations of electrical source, its importance and everything we need to know about them. It is not enough to explain the sectors alone, what made this Chapter lengthy is that every organizations and sectors are well laid out for everyone to know. In section 22-28 the Distribution Sector is discussed and explained perfectly. Starting in Section 29 -36 then is the Supply Sector. Overall, I learned a whole lot more about the sectors that was taught to us during school. All I know is that there are several sectors in the Electrical industry but because of this act I've realized that there is so much to know about other than the lessons taught to us inside a room.

Chapter 3 is about Role of the Department of Energy it only has a single section unlike the first two Chapters that I've encountered. Section 37 is titled Powers and Functions of the DOE and is then divided to 17 parts (a-q). The Department of Energy itself has already functions and responsibilities which is the goal to their organizations  "The Department of Energy (DOE) is responsible for the formulation and implementation of all plans, programs, projects, and activities of the government related to energy exploration, development, utilization, distribution, and conservation" but aside from all of those duties there are also functions stated in this section for restructuring the electricity industry. One of its many functions that is stated on this section that has caught my attention is the (d) Ensure the reliability, quality and security of supply of electric power. Yes, all of the functions and powers listed on this section have huge roles but for me, as a student the 4th function is something that I easily understood. DOE is a huge organization and has a huge part for the Electricity here in the Philippines. To ensure the reliability, quality and security is all top familiar with me as a Electrical Engineering student. It is only natural for the DOE to have this responsibility considering what their organization is all about, during this time where there are lots of exploitations, discrimination and theft of electricity we all need to know that we have the Department of Energy backing us up to these kind of things. Even so, the DOE can only do such things stated on the section mentioned. They don't own everything so its important to remind ourselves that even the DOE itself have restrictions to their power. This power that I have been talking about is not just for their own good but to ensure that they will accomplish the objectives of this Act.

Next chapter which is the Chapter 4 REGULATION OF THE ELECTRIC POWER INDUSTRY. This Chapter is composed of 9 sections: Section 38. Creation of the Energy Regulatory Commission; Section 39. Compensation and Other Emoluments for ERC Personnel; Section 40. Enhancement of Technical Competence; Section. 41. Promotion of Consumer Interests; Section 42. Budget of the ERC; Section 43. Functions of the ERC; Section 44. Transfer of Powers and Functions; Section 45. Cross Ownership, Market Power Abuse and Anti-Competitive Behavior; Section 46. Fines and Penalties. This Chapter is all about the rules maintained by the Authorities. A few parts of this chapter that is quite interesting to me is the Section 41, this is the part where it says that the Energy Regulatory Commission must handle all of the consumers complaints and concerns. Having an organization where you can voice out your problem.

When you have problems and you don't have anyone to turn to is quite frustrating, this kind of scenario will only cause a bigger problem that what it is before. So having ERC help us out with our concerns is just as important to Malls and establishments having customer service. Not only will it will help the organization to improve since the concerns will raise awareness to the company, it will also solve the consumers query. This Chapter is also lengthy but not like the first two chapters, this is also a well explained chapter a chapter where you will know a lot of things other than what is taught to you. Everything is detailed even up to the fines and transfer of powers. I think the ERC is highlighted in this part, what their position is all about and what duties they need to meet in order to keep the consumers satisfied. Overall, I learned a bunch of things again in this Chapter. It feels like the information and knowledge that I'm acquiring are stacking up one after another.

Chapter 5, this chapter is not that long compared to other chapters prior to chapter five. The title is Privatization of the assets of the National Power Corporation. Just from reading the title, we can have a head start of what this chapter is really about. Since the National Power Corporation is owned by the Government, this act shall move the ownership of the NPC into private companies, in other words, the government is going to sell its assets to private sectors. This chapter contains only two sections, section 47 and section 48. Section 47 is called the NPC Privatization. It says that except for the assets of SPUG, all assets shall be sold or privatized, as well as the IPP contracts of the National Power Corporation. Also, the participation of the Filipino citizens and corporations in the purchase of the NPC and its assets shall be encouraged. Next is Section 48, called the National Power Board of directors, things discussed in this section are the body organization of its directors also known as National Power board directors -this organization are the core minds of the private NPC that takes over the past officials.

Let us proceed to 6th Chapter. This chapter consists of several sections, from section 49 to section 55. This chapter in entitled Power Sector Assets and Liabilities, Management. It is quite long to read but it has meaningful information. First section is Section 49, Creation of Power Sector Assets and Liabilities Management Corporation, abbreviated as PSALM Corp. This corporation is government owned and ran by government constituents. Next is Section 50, Purpose and Objective, Domicile and Term Existence. Next section is Section 51, Powers. It contains the powers of the PSALM Corp listed from letter a to letter m. And Section 52 is called Power Sector Assets and Liabilities Management Corporation Meetings, Quorum and voting. Written in this section are the corporate business affairs of the PSALM Corp. Next section is section 53 that has title Powers of the President of Power Sector Assets and Liabilities Management  Corporation. The President is the Chief Executive Officer and he/she shall preside Board Meetings. Powers and duties are enumerated from letter A to letter G. After this Section is the Exemption from the Salary Standardization Law, known as Section 54. Salaries of the employees are exempted from Republic Act No. 6758. Next is 55, entitled Property of Power Sector Assets and Liabilities, Management Corporation. It includes funds, assets, contributions and other property that constitutes to the property of the PSALM Corp, listed letters A-H. And the next and last section of Chapter 6, section 56. Listed here from A to D are the claims against the corporation and is entitled as Claims Against The PSALM Corp. The chapter is quite long and the chapter ends here.

Before, rural communities are left behind in terms of technology and electricity unlike today. As a solution, EPIRA included the Rural Electrification and that oversees the Chapter 7 of this Act. Known as Promotion of Rural Electrification. It has 4 sections in it, Sections 57, 58, 59, and 60. Section 57 is the Conversion of Electric Cooperatives. They are given the choice to whether convert to stock corporation or stock cooperative. But they are not deprived to follow anything aside from their choice and of course, their chosen option is under such codes. Section 58, the Additional Mandate of the National Electrification Administration (NEA). Included in this section are three listed things that NEA shall implement and develop. Section 59, it is called Alternative electric Service for Isolated Villages. It is quite hard to electrify isolated homes and villages since it takes a lot of effort and a lot of budget if the source comes from the mainstream source like in the urbanized areas. If the Utility  cannot electrify the village then a qualified third party shall be hired. And for the last Section, it is Section 60 and it is called Debts of Electric Cooperatives, if we people owe debts to our friends or in banks, Electric Cooperatives also do. But upon the effect of this Act, the debts shall be assumed by the PSALM Corp.

The proceeding Chapter is of course the  chapter 8. We are almost done since it is the second to the last chapter of this Act. The Chapter is known as General Provisions. It consists of fourteen sections. From section 61 to section 74 respectively. This chapter consists Reportorial Requirements, Joint Congressional Power Commission, Separation Benefits of Officials and Employees of Affected Agencies, Fiscal prudence, Environmental protection, Benefits to Host communities, NPC Offer of transition Supply Contracts, Review of IPP Contracts, Negotiation of Power purchase and Energy Conversion Agreements between Government Entities, Missionary Electrification, Electric power crisis Provision, Mandated rate Reduction, Lifeline Rate, and Cross Subsidies. This chapter has quite long content and has meaningful provisions that make the Act more huge in terms of its scope.

And here comes the Last Chapter. After a very long read, I came here in the last part of the act and its just so fulfilling. Well, chapter 9 consists pretty decent number of sections, it has 7 sections, section75 to section 81. It is known and entitled as Final Provisions. It is indeed the last part since the Final provisions come into sight. It includes Statutory Construction, Education and protection of End-users, Implementing Rules and Regulations, Injunction and Restraining Order, Separability Clause, Applicability and Repealing Clause, and Effectivity Clause. It indeed consists of the end sections and final sections of the Act since it is the ending part.

After reading the Act, I search for some opinions in the internet regarding this and I have learned something that I have not been able to comprehend as a reader, a website told me that, first things first, “Former President Arroyo signed into law Republic Act 9136, or the EPIRA, Electric Power Industry Reform Act of 2001. Among other benefits, EPIRA is designed to bring down electricity rates and to improve the delivery of power supply to end-users by encouraging greater competition and efficiency in the electricity industry. The essence of these reforms is giving us options. First is Consumer Empowerment. This can be achieved by giving consumers the power to choose their source of electricity from among companies of generation and suppliers of electricity. Second, Higher Efficiency. Consumers will be assured of quality and reliable power supply at lower rates. And third, more legal basis on the industry that is more compact. EPIRA's intent was straightforward: Remove monopolies in the power industry through privatization of the National Power Corp.’s assets, and foster competition in the industry to make it more cost-effective and efficient. With these, electricity prices should go down.”

This act has put me into thinking of what grounds or situations that may I be up to when I finally be an Electrical Engineer. And as far as I know, EPIRA is a humanitarian act since it aims to provide order in the industry and of course, huge benefits for the people and the stakeholders.