Philippine Energy Policy Wiki

EO 856 (s. 2010) — Clark Freeport Zone Phase 3 Power Infrastructure

Status
operative
Confidence
high
Effective date
2010-01-19

Full title: Expanding the Coverage of Executive Order No. 666, Series of 2007, in Support of the Power Requirements of Clark Freeport Zone

Signed: January 19, 2010 | President: Gloria Macapagal-Arroyo

Note: GMA-era EO. Grouped under 2010 in the energy-tagged queue but predates the Aquino III administration (which began June 30, 2010).

Context

Builds on EO 666 (s. 2007), which directed agencies to support Clark Freeport Zone (CFZ) power infrastructure in three phases for Texas Instruments (TI) operations. Phases 1 and 2 of the 230 kV Clark Transmission Project had already been completed by TRANSCO/NGCP at the time of signing [EO 856, s. 2010, WHEREAS ¶2, 2010-01-19].

A new multinational semiconductor company (referred to in the EO as “SEI” — a semiconductor firm considering Clark) required the same power rate concessions as TI and assurance of reliable power through Phase 3 infrastructure [EO 856, s. 2010, WHEREAS ¶7, 2010-01-19].

Key Provisions

§1 — Phase 3 construction: Clark Development Corporation (CDC) designated as lead agency to expedite the Phase 3 Clark 230 kV Line Transmission Project, targeting completion within 1.5 years from EO signing [EO 856, s. 2010, §1, 2010-01-19].

§2 — Grid integration: Phases 1, 2, and 3 to be converted into a loop and made part of the national transmission grid [EO 856, s. 2010, §2, 2010-01-19].

§3 — Discounted rates: NPC shall provide SEI discounted transmission and generation rates equivalent to those granted to TI. Discount to be reported to ERC [EO 856, s. 2010, §3, 2010-01-19].

§4 — Funding: DOE, NPC, PSALM directed to work out the discounted rate through the Industry Competitiveness Fund (ICF) (created under EO 796, s. 2009). DBM to immediately release funds [EO 856, s. 2010, §4, 2010-01-19].

Policy Notes

  • Illustrates industrial energy pricing concessions as a tool for attracting export-oriented FDI to special economic zones
  • ERC is notified of the discount but has no approval function under this EO — the discount is an executive directive
  • ICF was the fiscal mechanism for subsidizing power costs of large strategic investors; its use here predates the more formalized EICC structure (see Energy Investment Coordinating Council (EICC) )

Full text: Cleaned copy