Geothermal Watershed Policy — Jurisdictional History

The Philippines has a long-standing institutional dispute over who manages the watershed areas surrounding its geothermal power reservations — the national environmental agency (DENR) or the energy sector operator (PNOC/DOE). The issue was litigated through competing executive issuances across five decades.

The Geothermal Reservations

Four major geothermal reservation areas with associated watershed management obligations:

Collectively, these are among the most significant geothermal resources in the country — and the global — geothermal portfolio. They power a substantial share of Visayas and Mindanao generation.

Jurisdictional Timeline

1983 — Ministry of Energy Deputization

MOE Order No. 83-06-15: The Office of Energy Affairs (predecessor of DOE) deputized PNOC to manage, protect, develop, and rehabilitate watershed areas surrounding the Tongonan, Palinpinon, and Bacon-Manito geothermal reservations [EO 206, s. 2016, WHEREAS ¶1, 2016-05-20].

1987 — EO 223: PNOC Given Formal Jurisdiction

EO 223 (s. 1987): Vested PNOC with formal jurisdiction, control, management, protection, development, and rehabilitation of the watershed areas surrounding geothermal reservations — Tongonan, Palinpinon, Bacon-Manito, and any future geothermal reservations discovered and developed by PNOC. DENR was simultaneously created as the primary environmental agency under EO 192 (s. 1987) [EO 186, s. 2015, WHEREAS ¶2–3, 2015-07-08].

1992 — Proclamation 853: Mt. Apo Added

Proclamation 853 (s. 1992): Declared the Mt. Apo National Park portion in South Cotabato and Davao as a geothermal reservation under PNOC administration [EO 186, s. 2015, WHEREAS ¶2, 2015-07-08].

2015 — EO 186: Transfer to DENR

EO 186 (s. 2015), signed July 8, 2015, by Aquino III: Transferred jurisdiction of all four geothermal reservation watershed areas from PNOC to DENR.

Rationale: PNOC had privatized its geothermal arm (PNOC Energy Development Corporation, now EDC, listed and majority-owned by First Gen/Lopez Group). With no in-house geothermal operator, PNOC had no established watershed management capacity. DENR, as the primary natural resource conservation agency under EO 192, was the natural successor [EO 186, s. 2015, WHEREAS ¶3–4, 2015-07-08].

2016 — EO 206: PNOC Jurisdiction Reinstated; EO 186 Repealed

EO 206 (s. 2016), signed May 20, 2016, by Aquino III: Expressly repealed EO 186 (s. 2015) and reinstated EO 223 (s. 1987) and Proclamation 853 (s. 1992).

Rationale: Two arguments drove the reversal — (1) The Paris Agreement (2015) linked geothermal and hydropower to national GHG reduction commitments, creating an energy-sector policy interest in watershed protection; and (2) RA 9513 (RE Act of 2008) designated DOE as lead agency for RE development, supporting the argument that RE watershed management belongs under DOE coordination [EO 206, s. 2016, WHEREAS ¶7–9, 2016-05-20].

EO 206 also sets an overarching policy: sustainable renewable energy resource management, consistent with Paris Agreement commitments [EO 206, s. 2016, §1, 2016-05-20].

Net effect: PNOC (or its designees) retains/retakes jurisdiction over the four geothermal watershed areas, now framed as a Paris Agreement and RE Act alignment issue.

Current Arrangement

As of EO 206, the arrangement restored under EO 223/1987 and Proclamation 853/1992 is operative:

• PNOC holds formal jurisdiction over geothermal reservation watersheds
• DOE is the coordination lead for RE resource management
• DENR retains environmental clearance and regulatory oversight functions but not watershed management jurisdiction

However, EDC (Energy Development Corporation) — the privatized PNOC-EDC successor, now majority-owned by First Gen Corporation — is the actual geothermal operator. The practical relationship between PNOC’s formal watershed jurisdiction and EDC’s operating control is governed by their concession arrangements.

Policy Significance

The EO 186 → EO 206 reversal within a single presidential term (10 months) illustrates an unresolved institutional tension in Philippine energy governance:

• DENR view: Geothermal watersheds are natural resources requiring conservation management; DENR is the statutory custodian under EO 192 and RA 7942
• DOE/PNOC view: Geothermal watersheds are part of RE resource infrastructure; watershed protection is integral to power plant operations and should follow the energy operator

The Paris Agreement framing in EO 206 added a climate dimension: watershed protection = carbon sink = NDC contribution, making geothermal watershed management an energy-climate policy intersection rather than a purely environmental matter.