=== dc2020-02-0003-pages-01.ppm ===
Republic of the Philippines
DEPARTMENT OF ENERGY

DEPARTMENT CIRCULAR NO. ?C#2020- 024-0003

PROVIDING A NATIONAL SMART GRID POLICY FRAMEWORK FOR THE
PHILIPPINE ELECTRIC POWER INDUSTRY AND ROADMAP FOR DISTRIBUTION
UTILITIES

WHEREAS, Section 2 of Republic Act No. 9136, otherwise known as the Electric Power
Industry Reform Act of 2001 (EPIRA), provides that it is a declared policy of the State,
among others, to:

“XN XKX

b) Ensure the quality reliability, security and affordability of the supply of electric
power

AMM ERX

f) Protect the public interest as il is affected by the rates and services of electric
utilities and other providers of electric power,

g) Assure socially and environmentally compatible energy sources and
infrastructure; and

A XM

k) Encourage the efficient use of energy and other modalities of demand side
management.

WHEREAS, Section 37 of the EPIRA mandates the Department of Energy (DOE) to

supervise the restructuring of the electric power industry and undertake, among others,
the following:

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 econamic plan and with the policies of enviranmental
protection and conservation and maintanance of ecological balance, and
provide a mechanism for the integration, rationalization and coordination of the
VaNous energy programs of fhe Govemment;

SAM SAA

c) Prepare and update annually a Power Developmen! Program (PDP) and
integrate the same into the Philippine Energy Plan (PEP). The POP integrate
=== dc2020-02-0003-pages-02.ppm ===
the individual or joint development plans of the generation, transmission, and
distribution sectors of fhe electric power industry:

dq) Ensure the reliability, quality and secunty of supply of electric power; and

6) Facilitate and encourage reforms in the structure and operations of distribution
ulivties (OUs) for greater efficiency and lower costs;

AEX RAR

WHEREAS, a Smart Grid (SG) uses innovative technologies to modemize the electric
grid infrastructure fo effectively address 21° century challanges of consumer
empowerment, energy supply flexibility and security, electric grid performance and asset
utilization, and environmental protection;

WHEREAS, on 11 March 2013, the DOE promulgated Deparment Circular (DC) No.
DC2013-03-0003, entitled, “Creating an Inter-Agency Steenng Committee for the
Development and Formulation of a Comprehensive and Holistic Smart Grd Policy
Framework and Roadmap for the Philippine Electric Power industry’, which directed the
DOE as the lead agency, along with the National Power Corporation (NPC), National
Transmission Corporation (TRANSCO), Philippine Electricity Market Corporation
(PEMC), National Grd Corporation of the Philippines (NGCP) and National Electrification
Administration (NEA), to achieve the following deliverables:

(a) Proposal for a Smart Grid National Strategy for the penod until 2030 with major
consideration on the possible impact to the price of electricity;

(6b) Formulation and preparation of the transition policies and guidelines for the
effective implementation of Smart Grid by all electric power industry
participants;

(¢) Preparation of a Roadmap for Smart Grid implementation; and

(d) Formulation of customer education and information framework for country wide
Smart Grid awareness and acceptance.

WHEREAS, the DOE envisions, as indicated in PEP 2040 and PDP 2040 to support
national economic development goal towards Ambisyon Natin 2040, to transform the
whole Philippine power sector into a secure, stable, flexible, sustainable, digitally enabled,
and interoperable system that provides reliable, efficient, and quality energy through grid
modernization and consumer empowerment:

WHEREAS, in order to support and implement the mandates of the Inter-Agency Steering
Committee, the DOE issued Special Order (SO) No. S502018-10-0057, dated 17 April
2018, entitled, “Creating ihe Department of Energy Smart Grd Technical Working Groups
(DOE SG-TWGs)", focusing on six (6) key areas, namely:

Page 2 of 17
=== dc2020-02-0003-pages-03.ppm ===
4) Power Systems Operations fed by Electric Power indusiry Management
Buraau (EPIMB):

b

——

Sustainable and Renewable Energy led by Renewable Energy Management
Bureau (REMB);

c) Standardization fed by Energy Utilization and Management Bureau (EUMB)};

d) Information and Communication Technology and Cybersecurity led by the
Information Technology and Management Senices (/TMS):

é) Regulatory Support led by the Legal Services (LS); and

} Cansumer Empowerment led by the Consumer Welfare and Promotion Office
(CWPO);

WHEREAS, the DUs have adopted and implemented various levels of Smart Grid
initiatives in their operations considering, among others, the following:

a) Aneed fo upgrade the electricity grid in ensuring its reliability and resiliency;
b) Higher cusforner demand and expectations;

ec) Increasing penetration of Vanable Renewable Energy (VRE) Sources and
growing deployment of Electne Vehicles (EVs);

d) Improvement of energy and power system efficiency and flexibility; and

6) fo achieve full implementation of Retail Competition and Open Access
(RCOA), Renewable Portfolio Standards (RPS), Green Energy Option
(GEOP), and Net Metering;

WHEREAS, on 19 April 2019, Republic Act (RA) No. 11285 or the Energy Efficiency and
Conservation Act (EECA) was signed to implament the energy efficiency and
conservation plans and programs of the DOE on a national level;

WHEREAS, RA No. 11234 or the Energy Virtual One-Stop Shop (EVOSS) Act and its
implementing rules and regulations, under Department Circular No. 002019-05-0007,
sets the timeframe for government agencies to decide on applications and cases relative
to energy generation, transmission and distribution projects;

WHEREAS, the DOE deems it necessary to develop a Smart Gnd Policy and Roadmap

to achieve the goals of the EPIRA and to meet the 21" century challenges of the Electric
Power Industry;

Page 3 of 17
=== dc2020-02-0003-pages-04.ppm ===
WHEREAS, in consideration of the inputs gathered during the Focus Group Discussions
(FGDs), the DOE formulated a draft circular providing policies and roadmap on Smart
Grid which was subjected to public consultations in Luzon (16 July 2019), Visayas (11
July 2079), and Mindanao (3 and 9 July 2019):

NOW, THEREFORE, for and in consideration of the aforementioned premises, the DOE
hereby issues the following policies and roadmap for the development and
implementation of Smart Grid in the country.

SECTION 1. Guiding Principles. Pursuant to the Policy of the State to supervise the
restructuring of the electric power industry and to ensure the quality, reliability, security
and affordability of supply of electric power, the DOE adopts the following criteria for the
transition of the Philippine Power System into a Smart Grid by 2040:

1.1. Safety
Improve overall system protection to prevent direct or indirect harmful and
dangerous effects to consumers from any electrical risks:

1.2. Reliability
Improve grid reliability to ensure the delivery of electric power to satisfy the
consumer demand, and enhance the capability of the Power System to respond to
disturbances without any adverse effects to the samme, while maintaining optimal
operation of the arid:

1.3. Efficiency
Reduce the technical and non-technical power and energy losses, in order to
ensure energy-saving benefits for the Generation, Transmission and Distribution
sectors:

1.4. Flexibility / Sustainability
Enhance the ability of the power system to respond to changes in demand and
supply, and allow the smooth integration of amerging technologies to the grid;

1.5. Resiliency
Improve the ability of the gnd, exposed to hazards, to resist, absorb, accommodate
and recover from the effects of a hazard in a timely and efficient manner, through
the preservation and restoration of its essential basic structures and functions: and

1.6. Consumer Empowerment
Improve consumer awareness and engagement through monitoring and managing
energy consumption and promote new emerging technologies such as electric
vehicles, net metering, smart monitoring equipment and appliances, among others.

SECTION 2. Definition of Terms. The terms as used in this Circular shall have their
respective meanings as follows:

Page d of 17
=== dc2020-02-0003-pages-05.ppm ===
2.1.

2.2.

2.3.

2.4.

2.5.

2.6.

2.7.

2.8.

2.9.

2.10,

Advanced Distribution Management System or ADMS — refers to a platform
that integrates hardware and multiple utility-based systems which provides
automated outage restoration and optimization of distribution grid performance:

Advanced Metering Infrastructure or AMI! — refers to an integrated system of
smart meters, communications networks, and implementation systems that
enables two-way communication between utilities and its customers. Customer
systems may include in-home displays, home area networks, energy management
systems, and other customer-side-of-the-meter equipment that enable smart grid
functions in residential, commercial, and industrial facilities:

Automatic Meter Reading or AMR — refers to the technology of automatically
collecting consumption, diagnostic, and status data from energy metering devices
and transferring that data to a central database for billing, troubleshooting, and
analysis;

Building Energy Management System or BEMS / Home Energy Management
System or HEMS — refers to a computer-based control system installed in houses
or buildings that controls and monitors mechanical and electrical equipment such
as aif-canditioning and ventilation, lighting, water heaters, pumps, other power
consuming equipment, fire protection and security systems, among others.
Dwellings or Buildings with HEMS/BEMS installed in its premises are generally
considered as Smart Homes / Buildings:

Conventional Meter — refers to an electronic of mechanical energy-measuring
device without any communication capability:

Cybersecurity — refers to a collection of tools, policies, security concepts, security
safeguards, guidelines, risk management approaches, actions, training, best
practices, assurance and technologies that can be used to protect the cyber
environment, the organization and user's assets;

Demand Response or DR — refers to a mechanism in which the utility can, for a
just cause, curtail the load at customer premises or disconnect certain equipment
of the customer remotely from the utility's control center. Customer participation for
DR program may be sought through incentives and penalties:

Demand Response Management System or DRMS — refers to a software
platform that allows a utility to manage all aspects of their DR programs through a
single, integrated system:

Demand-Side Management or DSM — refers to plans, programs, and
technologies that encourage consumers to optimize their energy use:

Distributed Energy Resources or DER — refers to smaller power sources that
could be aggregated to provide power necessary to meet réeqular demand:

Page Sof?
=== dc2020-02-0003-pages-06.ppm ===
2.11.

2.12.

2.13.

2.14.

2.15.

2.16.

2.17.

2.18.

2.19,

2.20.

2.21.

Distribution Management System or DMS — refers to a collection of software
applications designed to monitor and control the entire distribution network
efficiently and reliably:

Distribution Automation or DA — refers to an integrated system that enables an
electric utility to automate and remotely monitor, control and coordinate all the
distribution components installed in their franchise area;

Energy Management System or EMS — refers to a set of computer-aided tools
that is capable of monitering, controlling, and optimizing the operation of
geographically dispersed generation and transmission assets in real-time:

Electric Power Industry Reform Act of 2001 or EPIRA — refers to Republic Act
No, 9136:

Energy Storage System or ESS — refers to a facility acting as a load and a
generator, which is designed to receive, store and convert such energy to
electricity;

Fault Location, Isolation and Service Restoration or FLISR — refers to various
technologies and systems which work in tandem to locate a fault, reduce both the
impact and length of power interruptions by isolating the affected area/s, and
automate power restoration:

Flexible Generation — refers to a power generating facility with fast ramping / fast
start-up and shutdown capabilities connected directly to the transmission or
distribution system that helps manage fluctuations in supply and addresses the
intermittency of increasing variable renewable energy power plants:

Geographic Information System or G/S — refers to a collection of computer
hardware, software and geographic data for capturing, managing, analyzing and
displaying every form of geographically referenced information, often called spatial
data.

Grid — refers to the high voltage backbone system of interconnected transmission
lines, substations and related facilities, located in Luzon, Visayas and Mindanao or
as may be determined by the Energy Regulatory Commission (ERC) in accordance
with Section 45 of the EPIRA;

Interoperability — refers to an open architecture system with the ability of
Information systems and smart grid technologies to work together within and
across organizational boundaries:

Islanding — refers to a condition in which a power system, consisting of DU/s,

power source/s and load/s, continues to operate whenever the power fram the grid
is mo longer present:

Page Got 1?
=== dc2020-02-0003-pages-07.ppm ===
2.22.

2.23.

2.24,

2.25.

2.26.

2.27.

2.28,

Micro-grid System — refers to a group of interconnected loads and DERs within
clearly defined electrical boundaries that acts as a single controllable entity with
respect to the grid. A micro-grid can connect and disconnect from the grid which
enables it to operate either in grid-connected mode or in island mode;

Mobile Workforce Management System or MWMS -— refers to a systern platform
that enables a utility to allot maintenance jobs to the crews in the field on real-time
basis. Information on the type of fault is made available on the Mobile to support
troubleshooting. Good mobile workforce management applications will have real-
time scheduling engine integrated to the GIS;

Outage Management System or OMS — refers to a utility network management
software application that models network topology for safe and efficient field
operations related to outage restoration. OMSs tightly integrate with call centers to
provide timely. accurate, customer-specific outage information, as well as with the
supervisory control and data acquisition (SCADA) systems for real-time confirmed
switching and breaker operations. These systems track, group, and display
outages to safely and efficiently manage service restoration activities;

Peak Load Management — refers to plans, programs, and technologies that allow
distribution utilities to manage its customer demand during peak hours;

Smart Distribution / Substation Automation or SDA / SSA — refers to various
automated control techniques that optimize the performance of power distribution
networks by allowing individual devices to sense the operating conditions of the
grid around them and make adjustments to improve the overall power flaw and
optimize performance:

smart Grid — refers to a modermized electrical grid that utilizes innovative
technologies with two-way and/or multi-way communication technologies, real-
time monitoring and control systems to:

2.27.1. Improve overall reliability, power quality, security, efficiency and
management of the electricity grid with full cybersecurity and
interoperability;

2.27.2. Allow suitable integration of bulk and flexible generation, distributed
energy resources, micro-gnds, and electric vehicles with management
systems; and

2.27.3. Empower customers with the provision of timely information and control
options through enhanced energy management systems.

Smart Appliances / Devices — refers to real-time, automated, interactive

technologies that optimize the physical operation of appliances, communication
technologies, and consumer devices:

Page 7 of i?
=== dc2020-02-0003-pages-08.ppm ===
2.29,

2.30.

2.31.

2.32.

2.33,

Smart Meter - refers to an electronic real-time energy-measuring device that is
capable of remote connect/disconnect switching, outage and tamper detection,
and has a two-way communication between the meter and the utility. Asmart meter
records consumption of electric energy in intervals of an hour or less and
communicates that information back to the utility for monitoring and billing;

Supervisory Control and Data Acquisition or SCADA — refers to a system of
software and hardware components that allows the utility to:

2.30.1. Control processes locally or at remote locations:
2.30.2. Monitor, gather, and process real-time data;

2.30.3. Directly interact with equipment through human-machine interface
software; and

2.30.4. Record events into a log file.

Substation Automation or SA — refers to an integrated system that enables an
electric utility to automate and remotely monitor, control and coordinate the
distribution components installed in the substation;

Virtual Power Plant or VPP — refers to a network of aggregated decentralized,
medium-scale power generating units such as, but not limited to, Combined Heat
and Power (CHP) units, wind farms, solar PVs, flexible power
consumers/prosumers and energy storage systems. The interconnected units will
be dispatched through the central control room of the VPP. These VPFs aim to
relieve the load on the grid by intuitively distributing the aggregated power
generated by the individual units; and

Wide Area Monitoring System or WAMS -— refers to a system to improve
situational awareness and visibility within the gnd. With Phasor Measurement Units
(PMU) that are capable of fast and accurate measurements, the grid records
synchro-phasor data that is accurately time-stamped.

SECTION 3. Scope and Coverage. This Circular shall apply primarily to Distribution
Utilities (DUs), including grid-connected, micro-grids and off-grid systams. This shall be
supported by and linked to the following Electric Power Industry Participants:

3.1,
3.2.
3.3.

Generation Companies (GenCas):
Transmission Network Provider (TNP};
Customers / End-users which include:

3.3.1. Utility Customers, and
3.3.2. Non-Utility Customers;

Page 8 of 17
=== dc2020-02-0003-pages-09.ppm ===
3.4.
3.5.

3.6.

system Operator (50);
Market Operator (MO); and

Market Governance.

SECTION 4. Smart Grid Vision. Towards this end, it is envisioned that the Philippines
will reach a level of Smart Grid development capable of the following:

4.1.
4.2.
4.3.

4.4,

4.5.
4.6.
4.7.

4.8.

Selt-healing grid:

Full Customer Choice;

Full Implementation of the Retail Competition and Open Access (RCOA),
Renewable Portfolio Standards (RPS), Green Energy Option (GEOP), and Net
Metering;

Optimized Energy Storage Systems (ESSs), Energy Management Systems
(EMSs), and Distributed Energy Resources (DERs) Management Systems:

Virtual Power Plant Integration;
Islanding;
Demand Response, Demand-Side and Peak Load Management: and

Smart Homes and Cities.

SECTION §. Overall Framework and Infrastructure. The framework and infrastructure
of the SG shall be comprised of the following major sectors:

5.1.

Smart Power Generation. The Smart Power Generation (SPG) shall be
envisioned as a secure, fast. dynamic, flexible, and efficient resource capacity by
integrating new and emerging technologies into the Generation Sector. This
includes, among others, the use of DERs, Hybrid Systems, ESSs, and Flexible
Generation,

SPGs shall gradually be integrated into the wholesale and retail electricity markets.
for the provision of energy and ancillary services. The integration of SPGs is
envisioned to improve the competition in the electricity market and the efficiency,
reliability and flexibility of power grid operations.

The use of advance monitoring systems in power generation facilities is predicted
to contnbute in reducing power plant outages and in improving plant maintenance
scheduling, Enhancements in forecasting and generation planning are also
expected as modern software capable of handling multiple parameters emerge.

Page FoF 17
=== dc2020-02-0003-pages-10.ppm ===
§.2 f

5.3.

Transmission Modemization. A modemized transmission grid shall have, among
others, the following features:

§.2.1. Wide Area Monitoring and Control;

5.2.2. Regional Frequency and Voltage Stability Control:
5.2.3. Full Transmission Automation: and

§.2.4, Island-to-Grid interconnection,

The integration of SG in the transmission system is envisioned to improve system
efficiency and to minimize losses in the transfer of electricity from one node to
another. This development will allow adequate response to grid disturbances and
will address grid resiliency.

Smart Distribution Utility. A Smart Distnbution Utility (SOU) shall be envisioned
to be a reliable, flexible, resilient and secure automated distribution system
integrated with decentralized energy sources. This modemized distribution system
is expected to promote consumer empowerment and to influence consumer
behavior towards efficient utilization of energy.

To realize this vision, the DUs shall be guided by the Smart Distribution Utility
Roadmap (SDUR) attached herein as Annex A.

3.3.1, Levelling as to Networks. SOUR levelling as to Networks is categorized,
as follows

LevelO- refers to DUs that have yet to initiate any SG plans and
programs and are considered as manually-operated system;

Levelt — refers to DUs that have initiated the installation and integration
of reclosers, sectionalizers, load break switches, fault circuit
indicators, SCADA systems, and/or GIS:

Level2-— refers to DUs that have initiated the installation of remote
voltage regulators and/or capacitor banks and/or the
implementation of DA, SA, DMS, OMS, and/or MVWMS;

Level3-— refers to OUs that have initiated the implementation of FLISR
and/or ADMS with SDA and SSA; and

Level4— refers to DUs that have fully implemented SDA and SSA.

5.3.2. Levelling as to Customer Service. SDUR levelling as to Customer Service
is Categorized as follows:

LevelO-— refers to DUs using conventional metering and have yet to
inttiate any AMI plans and programs:

Page 10 of 17
=== dc2020-02-0003-pages-11.ppm ===
5.3.3.

5.3.4,

Level 7 =

Level 2 -

Level 3 -

Level 4—-

refers to DUs that have initiated the installation and integration
of AMR:

refers to DUs that have initiated the implementation of AMI by
installing Smart Meters, Data Management System, and Data
Center and Server.

refers to DUs that have installed additional Smart Meters; and

refers to DUs that have fully implemented AMI technologies.

Advanced Metering Infrastructure. DUs implementing AMI technologies
shall undertake the following:

5.3.3.1.

6.3.3.2.

5.3.9.3,

Consumer Access Rights. Consumers shall be able to
access their own information at any given time of the day
through all means of communication provided by the host DU,
and shail be properly informed on how to request or receive
their available consumption data.

Data Privacy. The consumers’ detailed energy consumptian
data shall be protected and shall be treated as highly
confidential. The DUs may be allowed to release any available
information to third parties upon customer request and
approval.

Consumer-Facing Devices. The DUs may install additional
energy monitoring and control devices. upon consumer
request and approval, to encourage consumer interest in
energy saving decisions and response to demand: Provided,
That these technologies shall only be applied in their
respective customer premises: Provided further, That the
provision of additional devices/technologies shail be simple
and user-friendly; Provided finally, That the DUs may be
allowed to charge additional rates, subject to ERC approval,
for value-added services.

Consumer Education. The DUs shall conduct programs intended to
engage active participation of consumers, through education and
information campaigns, including, but not limited to, uses and benefits of
SG technologies.

5.3.9. Geographic Information System. The DUs shall update and/or upgrade

their GIS in a periodic manner.

Page 11 of 17
=== dc2020-02-0003-pages-12.ppm ===
5.3.6.

5.3.7,

§.3.8.

ESS and DER. Integrating ESS and DER to any host DU shall be subject
to the monitoring and control technologies of the respective level of SG
implementation the host DU is categorized into,

The proponent of ESSs and DERs shall further comply with the provisions
of relevant ERC Rules and Regulations and DOE Policies.

Electric Vehicle (EV) Charging Stations.

9.3.7.1.In order to promote use of EVs, DUs may establish/facilitate the
establishment of charging stations. Private and government
instrumentalities can install charging stations under a non-
regulatory pricing (prevailing rates) and market-based environment

5.3.7.2. The DOE, through the SG Inter-Agency Steering Committee (SG-
IASC). in collaboration with all the Electric Power Industry
Participants, the Department of Transportation, Department of
Trade and Industry and all relevant government agencies, shall
formulate a long-term National Strategy and Roadmap for EVs and
EV Charging Stations, consistent with the Philippine Energy Plan.

Pilot Projects.

§.3.8.1.The DUs that have yet to implement SG technologies are
encouraged to conduct demonstration/pilot projects or develop in-
house technologies to jumpstart their SG implementation.

$.3.8.2.The DOE and other related government agencies shall actively
engage with the DUs in developing demonstration projects to
ensure benefit to the future grid, while ensunng consumer
protection.

5.4. Information Sharing and Education Campaigns.

5.4.1.

§.4.2.

The DOE, with the assistance of the stakeholders and other relevant
government agencies, shall conduct intensive Information, Education and
Communication Campaigns (IECs) to consumers. The campaigns shall
address consumer concerns and awareness on matters such as data
privacy, energy-saving practices, trends on digitalization and grid
modemization, among others

The campaigns shall clearly explain the benefits of SG, including the
advantages of allowing the use of SG infrastructure in their premises. At the
same time, the IECs shall aim at empowering customers io make informed
decisions that reflect their management and cost of electricity, comfort and
environmental preferences.

Page 12 of 17
=== dc2020-02-0003-pages-13.ppm ===
5.5.

5.6.

5.4.3,

5.4.4,

The DOE, in coordination with other government agencies, stakeholders,
Private companies and academe, shall continue to support information
sharing and experience exchanges about SG deployments to promote
effective cost-benefit investments and remove information barriers,
Centralized public repositones for information and data gathering from SG
Conferences, Exhibitions, Seminars and Capacity Buildings are highly
encouraged.

The DOE and other relevant agencies shall actively participate in various
fora and conferences that provide the latest trends and developments in SG
implementation to further align and formulate policies related to SG.

Communication Infrastructure Support. The DOE, in coordination with relevant
government agencies and private companies, shall support the following
objectives:

§.5.1.

6.5.2.

Communication Provider — DU/s partnerships are highly encouraged to
ensure the appropriate integration of SG Information and communication
technologies,

Reasonable rates, and fast and reliable service by telecommunication
companies shall be provided to Electric Industry Participants for SG
deployments:

. The DUs are encouraged to implement all means of communication which

are compliant with internationally accepted standards, such as Worldwide
Interoperability for Microwave Access (WiMax), Radio Frequency (RF)
Mesh, Low-Power Wide-Area Network (LPWAN}), and Zigbee technology,
among others: and

. The DOE shall coordinate with the National Telecommunications

Cammission (NTC) in the allotment of radio frequencies for GenCos, TNP,
and DUs fo enable the reliable operations of their respective SG
deployments.

Interoperability.

5.6.1,

5.6.2,

The DOE, through the SG-IASC, shall have the primary responsibility to
coordinate with relevant government agencies and stakeholders to develop
a framework that includes protocols and technical standards to achieve
interoperability of SG deployment.

SG interoperability protocols and standards shall align further policies,
business models, and technology approaches in a manner that will enable
all electric participants to share and use information securely and effectively
and to contribute to an efficient, reliable, flexible, secure and technology-
neutral SG electricity network,

Page 13 of 17
=== dc2020-02-0003-pages-14.ppm ===
3.7.

Cybersecurity.

5.7.1. To prevent potential cyber-attacks/breach during SS deployments,
GenCGes, TNP, and DUs shall develop a cybersecurity infrastructure and
ensure cost-effective protection.

5.7.2. Cybersecurity infrastructure to be developed shall be compliant with all
relevant laws and requlations as well as internationally accepted standards
at the appropriate level of adoption and application.

SECTION 6. Duties and Responsibilities. Electric Power Industry stakeholders shall
have the following responsibilities:

6.1.

6.2.

Inter-Agency Steering Committee (IASC).

6.1.1. The IASC shall ensure proper and smooth transition of the electric power
industry to future SG deployment;

6.1.2. The IASC shall ensuré proper coordination and consultation with
government agencies, private sectors, academe, and international
agencies who have sufficient experience and expertise on all aspects of SG
development prior to the issuance of any policy pertinent hereto:

6.1.3, The IASC shall continue to monitor SG initiatives to protect consumer
interests, prevent anti-competitive practices, and identify any regulatory or
government barriers prior to its deployment:

6.1.4, The JASC shall conduct a regular review of ihe SDUR and propose
amendment, if necessary to ensure up-to-date SG implementation; and

6.1.5. The IASC shall perform all olher tasks necessary and incidental for the
effective implementation of this Circular, in addition to the provisions of
DC201 3-03-0003 that are consistent hereto.

Generation Companies.

6.2.1. The GenCos shall integrate SPG into the transmission or distribution
system, consistent with the Power Development Pian.

6.2.2. The design, ownership, operation, and maintenance of any SPG facility

shall comply with the provisions of relevant laws, ERC rules and regulations,
and policies promulgated by the DOE.

Page i4of iF
=== dc2020-02-0003-pages-15.ppm ===
6.3.

6.4,

6.5.

6.6.

Transmission Network Provider.

6.3.1. The TNP shall formulate and submit to the DOE and ERC an SG
deployment plan and roadmap that includes transmission system
enhancement. wide area monitoring systems, automation and network
optimization, and long-term interconnection-wide transmission expansion
plans, among others.

6.3.2. The SG roadmap to be formulated shall form part of the annual
Transmission Development Plan.

Distribution Utilities.

6.4.1, The BUs shall comply with the levelling structure, in accordance with the
National SOUR; Provided, That the DUs shall complete the initial levels first
before venturing into the succeeding levels, as applicable; Provided further,
That the OUs shail evaluate their current level of SG implementation in
reference to the National SDUR and formulate an SG deployment plan, to
be submitted to the DOE and copy furnished ERC; Provided finally, That
the DUs may request to accelerate or defer their SG deployments, as
justified in their business cases, subject to endorsement by the DOE and
approval of the ERC.

6.4.2. The OUs shall incorporate all proposed SG projects, in accordance with the
SDUR, in the annual update of their respective Distribution Development
Plans.

Market Operator. The Market Operator shall review and/or propose amendments
to the WESM rules and Manuals for the possible integration of SG technologies to
the wholesale and retail electricity markets.

system Operator. The SO shall ensure grid reliability and stability during
implementation of SG technologies,

SECTION 7. Regulatory and Government Support

7.1.

Department of Energy (DOE)

7.1.7. The DOE, through the SG-TWGs, shall prepare and formulate relevant
policies and guidelines for SG technologies necessary to improve and
support SG implementation:

7.1.2. The DOE shall endorse SG projects to the appropriate agencies or
institutions for existing and available direct or indirect subsidies or
incentives, such as tax holiday, among others, to be applied with the Bureau
of Investments (BOl) and other related government agencies.

Page 15 of 17
=== dc2020-02-0003-pages-16.ppm ===
7.2.

7.1.3. The DOE shall coordinate with relevant agencies to establish new incentive

7.14.

mechanisms for SG development, if needed,

The DOE shall establish strong cooperation and partnership among
relevant local and international government agencies, stakeholders,
academe, and private entities for SG research, development, and
demonstration projects.

7.1.5, The DOE shall coordinate with relevant government agencies, specifically

with the following:

7.1.5.1. The Department of Science and Technology (DOST) and
other research related government agencies to encourage them to
undertake research and development that will lead to
commiercialization and more investments on advanced technologies
pertinent to SG.

7.1.5.2. The Department of Trade and Industry, Department of
Information and Communications Technology, NTC, DOST and
Bureau of Customs, among others, to enjoin them to develop
technical standards and safety codes for SG technologies in order to
ensure successful and safe deployment in the electric power system.

Energy Regulatory Commission (ERC).

7.2.1.

T.2.2.

Td.

7.2.4,

7.2.5.

The ERC shail promulgate, within six (6) months from the effectivity of this
Circular, related quidelines to ensure proper and timely implementation of
the policies set forth herein.

The ERC shall rewew and amend the existing Electric Cooperative
Distribution Utility Planning Manual and Investor-Owned Electric
Distribution Utility Planning Manual in accordance with the objectives
provided in this Circular.

The ERC shall develop SG standards to be harmonized into the Philippine
Distribution Code and Philippine Grid Code.

The ERC, pursuant to its mandate under the EPIRA, shall review all Capital
Expenditure (CAPEX) and Operating Expenditure (OPEX) applications filed
by the TNP and DUs to ensure efficient and reasonable costs for the
effective and timely implementation of SG projects.

The ERC shall ensure timely approval of said applications for the recovery
of reasonable capital and operating expenditures, taking into consideration
the objectives set forth in this Circular, the risk of the technologies becoming
obsolete, and all the benefits of SG adoption, such as, but not limited to,
customer's energy consumption savings and DU savings,

Page 16 of 17
=== dc2020-02-0003-pages-17.ppm ===
7.3, National Electrification Administration (NEA)

7.3.1. The NEA shall ensure the provision of concessional loans to SG projects in
case of Electric Cooperatives (ECs), subject to other requirements deemed
by NEA: and

7.3.2. The NEA shall propose a national strategy for SG deployments to ECs
based on current performance assessment and evaluation.

SECTION 8. Repealing Clause. Rules, regulations, policies and all other issuances, as
well as the mechanisms and institutions created and responsibilities designated pursuant
thereto, that are inconsistent with this Circular are hereby amended, modified or repealed
accordingly.

SECTION 9. Separability Clause. If, for any reason, any section or provision of this
Circular is declared unconstitutional or invalid, the other parts or provisions hereof which
are not affected thereby shall continue to be in full force and effect.

SECTION 10. Effectivity. This IRR shall take effect fifteen (15) days from its publication
in at least two (2) newspapers of general circulation and shall remain in effect until

otherwise revoked. Certified true copies of this Circular shall be filed with the University
of the Philippines Law Center-Office of the National Administrative Register.

Signed this day of 2020 at DOE, Energy Center, Rizal

ee a
RIPAATMEET OF ey
a a A COTE,

DOE.AiC 20000140
WAN DAES OOM TA

0 “Cc
5 tary

FEBO6 2020

Page 17 of 17
=== dc2020-02-0003-pages-18.ppm ===
Networks

a , fl
—_——

Customer '

service {|

ontinuous/ }
Parallel
Programs ,

ANNEX A

SMART DISTRIBUTION UTILITY ROADMAP (SDUR) rai

BY 2040

Level 0 Level 1 Level 2 Level 3 Level 4

Physical Network h Remote voltage
Transtorrmation regulators, and capacttor
« CADA-Ready Reclosnrs hariles
= Manali * Sectionalizers * Implementation of
operated * Load Break Switches Castribution Managenerit
Diseribution * Fault Clrouit Indicaters System (OmMAS}
Network " Distribution Transformer * Distribution and = Full Smart C4stribution
system Monitoring: Eqqpuilpreent SuBrtotion and Substation
* SCADA System Auterrtion Automation
* Komote Feeder * Outage Management
Lifvess System (ONS)
* Remotes * Mobile
Substation Workforce
* Implementation of Monagement
Geographic information Syrtern (NAS)
\_Sestarn (5)
* |nitlal implementation of
* Impiernentation of _
* Conventional i ted het * Smart Meters * Sealing-upAMl

* integration of Energy Storage Syatern (E55) and Blectric Vehicle (EV) Charging Station
* Distributed Energy Resources Integration and Energy Management Systems
= Consumer Edication
* Updating of GIs
* Interoperability and Cybersecurity
* Telecomimonications infrastructure