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Republic of the Philippines
DEPARTMENT OF ENERGY

DEPARTMENT CIRCULAR NO. DC 2020- |0- 0023

PRESCRIBING POLICY FRAMEWORK FOR THE DEVELOPMENT OF THE
FUEL ECONOMY RATING, FUEL ECONOMY PERFORMANCE, AND
RELATED ENERGY EFFICIENCY AND CONSERVATION POLICIES FOR
THE TRANSPORT SECTOR AND OTHER SUPPORT INFRASTRUCTURES

WHEREAS, Section 2 of Republic Act No. 7638 or the “Department of Energy (DOE)
Act of 1992” states that it is the policy of the State to ensure a continuous, adequate,
reliable, and economic supply of energy through, among others, judicious
conservation, renewal, and efficient utilization of energy, to keep pace with the
country’s growth and economic development,

WHEREAS, Sections 4 and 5 of the DOE Act of 1992 as amended, mandates for tne
formulation of policies for the planning and implementation of a comprehensive
program for the efficient supply and economical use of energy consistent with the
approved national economic plan, and the provision for a mechanism for the
integration, rationalization and coordination of the various energy programs of the
Government with a preferential bias for environment-friendly, indigenous, and low-cost
sources of energy:

WHEREAS, Section 3 of the Republic Act No. 11285 or the “Energy Efficiency and
Conservation Act” (EEC Act) provides for the establishment of a framework for
introducing and institutionalizing fundamental policies on energy efficiency and
conservation, including the promotion of efficient and judicious utilization of energy,
increase in the utilization of energy efficiency and renewable energy technologies, and
the delineation of responsibilities among various government agencies and private
entities;

WHEREAS, Section 14 of the EEC Act states that the Minimum Energy Performance
(MEP) for the commercial, industrial, and transport sectors shall be developed by the
DOE, in consultation with relevant stakeholders, and guided by a cost-benefit analysis
which shall be completed by the DOE with the assistance of the National Economic
Development Authority (NEDA); Further, Section 5 of the Philippine Energy Labeling
Program (PELP) Guidelines provides that fuel economy performance labeling
requirements for transport shall be made after public consultation and coordination
with DENR and DOTr;

WHEREAS, Section 17 of the EEC Act directs the DOE with the assistance of the
Department of Environment and Natural Resources (DENR) and the Department of
Transportation (DOTr) for the development of fuel economy performance labelling
requirements and fuel efficiency testing guidelines can validate the information

OOO sss.

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provided by vehicle manufacturers, importers, and dealers which will allow the
consumers to make an informed decision in choosing the vehicles for their use;

WHEREAS, Section 58 of Department Circular No. DC2019-11-0014 of the
"Implementing Rules and Regulations of the EEC Act” (EEC-IRR) states that the DOE
shall prescribe energy efficiency rating and energy labeling systems for products and
equipment and transport vehicles, which shall be implemented for all applicable
industry stakeholders. Any energy-consuming product, device or equipment and
transport vehicle covered in the EEC-IRR and the guidelines to be issued by the DOE,
which does not comply with the efficiency rating and energy labeling system shall not
be sold within the Philippines;

WHEREAS, Section 60 of the Department Circular No. DC2019-11-0014 or the
Implementing Rules and Regulation of the EEC Act (EEC-IRR) states that the fuel
economy rating shall be with due consultation with the industry stakeholders;

WHEREAS, conservation and efficient utilization of energy are among the major
strategies of the Government to realize energy self-sufficiency and reduce
environmental impacts of energy generation and utilization as instituted in the
Philippine Energy Plan (PEP) and the National Energy Efficiency and Conservation
Program (NEECP); and

WHEREAS, the development of the framework will lead to, among others, the
empowerment of consumers in choosing fuel efficient transport vehicles, realization of
energy savings, reduction of fuel consumption, phase out of fuel inefficient transport
vehicles, and the reduction of greenhouse gas emissions.

NOW, THEREFORE, for and in consideration of the foregoing premises and pursuant
to its mandate under the EEC Act and EEC-IRR, the DOE hereby orders the following:

Section 1. Title. This Department Circular shall be known as the "Policy Framework
for the Development of the Fuel Economy Rating, Fuel Economy Performance, and
Related Energy Efficiency and Conservation Policies for the Transport Sector and
Other Support Infrastructures.”

Section 2. Scope. This Department Circular shall provide the framework for the
development of fuel economy rating, fuel economy performance for transport vehicles
and related energy efficiency and conservation policies applicable to all
manufacturers, importers, distributors and dealers of vehicles in the Philippines.
Further, the development and operation of Electric Vehicle and Electric Vehicle
Charging Infrastructures shall be structured to facilitate the safe operation and growth
while ensuring equitable non-discriminatory and open access for all.

Section 3. Definition of Terms. As a used in this Department Circular, the following
terms shall be understood the mean:

3.1. “Energy” refers to all types of energy available commercially including
natural gas (liquid gas and liquid oil gas), all heating and cooling fuels

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3.2

3.3

3.4

3.5

3.6

(including district heating and district cooling), coal, transport fuels, and
renewable energy sources;

"Energy Efficiency” refers to the way of managing and restraining the
growth in energy consumption resulting in the delivery of more services
for the same energy input or the same services for less energy input;

“Energy Labelling" refers to the Philippine Energy and Labelling Program
(PELP) which requires manufacturers to attach an energy label on their
products to inform consumers about the energy performance and
efficiency of the product;

“Minimum Energy Performance (MEP)" refers to the performance
standard which prescribes a minimum level of energy performance for
the commercial, industrial, transport sectors, and energy-consuming
products including appliances, lighting, electrical equipment, machinery,
and transport vehicles that must be met or exceeded before they can be
offered for sale or used for residential, commercial. transport, and
industrial purposes;

"Specific Energy Consumption" refers to the energy consumption volume
required per unit, such as production volume, sales amount,
transportation kilometer, transportation tonne-kilometer, floor space, and
such other indicators relevant to energy consumption; and

"Transport Vehicles" refer to land, air, or sea vehicles conveying cargo
or passengers, regardless of size or weight classification.

Section 4. Inter-Agency Working Group (IWG). An IWG is hereby created to be
composed of representatives from the DOE, DENR, DOTR and NEDA. The said
agencies will perform functions as stated in the EEC law, its IRR and this Department
Circular as enumerated hereunder:

4.1

4.2

4.3

The DOE as the implementing agency shall be responsible for the
planning, formulation, development, implementation, enforcement, and
monitoring of energy management policies and other related energy
efficiency and conservation plans and programs.

The DENR in coordination with the DOE and DILG, will establish
guidelines for the accurate characterization of wastes arising from
energy-consuming devices, equipment, fixtures, and other relevant
items, including the end-of-life vehicles and its component parts.

The DOTR shall be responsible for ensuring compliance of vehicle
owners, manufacturers, and importers with the MEP for transport
vehicles consistent with the specifications for all types of fuels prescribed
under Republic Act No. 8749, otherwise known as the “Philippine Clean
Air Act of 1999". and to display the energy consumption label in
coordination with the vehicle manufactures, transport industry

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44

4.5

Section 5.

5.1

§.2

5.3

5.4

5.5

5.6

associations, public transport groups, and non-government
organizations. The DOTr shall also assist the DOE in the enforcement of
and compliance with measures under EEC Act and its IRR relative to the
energy consumption of the transport sector.

The NEDA shall recognize the role of energy efficiency and conservation
in national development.

DOE-Energy Utilization and Management Bureau (EUMB) shall serve as
the IWG Secretariat. The EUMB is tasked to review existing policies,
study analysis of academic institutions, for the drafting of policies in
consultation with the relevant stakeholders on Transport Sectors,
consistent with the Philippine Energy Plan and the National Energy
Efficiency and Conservation Program (NEECP).

IWG Responsibilities. The |WG shall have the following responsibilities:

Support the Technical Working Group (TWG) created under Section 10
of the PELP Guidelines for the development and the issuance of policies
for fuel economy rating, fuel economy performance for transport
vehicles, including but not limited to internal combustion engine vehicles,
electric vehicles, and next generation vehicles;

Invite other concerned government agencies and private organizations,
groups or individuals as members and/or resource persons in order to
develop the policies for fuel economy rating, fuel economy performance
for transport vehicles, support infrastructures, among others;

Meet on a regular basis for the continued development of policies;

Study new funding schemes or grant from public, private, bilateral or
multilateral institutions, develop donor interest and efforts in providing
technical, logistical support or capacity building to improve governance
of the DOE's policy initiatives on fuel economy rating, fuel economy
performance for transport vehicles, support infrastructures and related
policies;

Submit regular reports to the DOE Secretary on the progress of the
policy developments; and

Perform such other tasks necessary for the effective accomplishment of
the principles of this Department Circular.

Section 6. Enforcement, Monitoring and Verification. The enforcement, monitoring
and verification of compliance by applicants and retailers with the PELP requirements
in the various regions of the country shall be conducted at least once a year.

SSS
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Section 7. Prohibited Acts. Pursuant to the EEC Act and the EEC-IRR, any person
or entity found in violation of any of the following shall be subject to the appropriate
criminal, civil and/or administrative sanctions as follows:

7.1
7.2

7.3

74

7.5
7.6

7.7

Failure to comply with energy labels;

Removing, defacing or altering any energy label on the ECPs before the
product is sold to the first retail purchaser or leased to the first lessee;

Failure to provide accurate information or the provision of false or
misleading information as required to be submitted under the EEC Act
and the EEC-IRR;

Selling, leasing or importing transport vehicles that do not comply with
PELP and MEP;

Willfully refusing to submit to an on-site inspection;

Failure or willfully refusing to submit any of the reports required therein;
and

Failure to comply with issued orders of the DOE in the discharge of its
enforcement powers;

Section 8. Administrative Procedures. The DOE may initiate, motu proprio or upon
filling of complaint, an administrative proceeding against any person or entity who
commits any of the prohibited acts under Section 30 of the Act, and Section 76 of the
EEC-IRR, or other related issuances.

The administrative proceedings will be conducted to determine culpability of offenders
and the applicable penalties in accordance with the provisions of the EEC Act, its IRR
and this Department Circular.

Section 9. Explanation, Recommendation, Disclosure and Order. The DOE may
consider the following measures prior to the imposition of fines, penalties and
administrative liabilities as provided below:

9.1

9.2

9.3

Require an explanation supported by reports, returns and other
documents to rebut the alleged commission of the prohibited act;

In cases where an explanation has been issued but the DOE finds a
violation because of materially insufficient reports, false returns, non-
submission of required documents, provide a recommendation to the
said person or entity;

Disclose the name of the person or entity after it has received a
recommendation and comply with such recommendation; and

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94 Issue an order in cases where the said person or entity fails to follow or
comply with the recommendation of the DOE. The failure on the part of
the person or entity to comply with the order shall be a valid ground for
the imposition of the administrative fines and penalties in accordance
with Schedule of Penalties and Fines (Annex A).

Section 10. Fines and Penalties. The DOE is empowered to impose fines and
penalties for any violation of the prohibited acts enumerated under Section 7 hereof
and after exhausting the measures provided for under Section 9 of this Department
Circular.

10.1 Failure to comply with energy labels;

10.2 Removing, defacing or altering any energy label on the ECPs before the
product is sold to the first retail purchaser or leased to the first lessee;

10.3 Failure to provide accurate information or the provision of false or
misleading information as required to be submitted under the EEC Act
and the EEC-IRR;

10.4 Selling, leasing or importing transport vehicles that do not comply with
PELP and MEP;

10.5 Willfully refusing to submit to an on-site inspection;

10.6 Failure or willfully refusing to submit any of the reports required therein;
and

10.7 Failure to comply with issued orders of the DOE in the discharge of its
enforcement powers;

The imposition of the administrative fines and penalties shall be on a "per violation" or
“per offense" basis and without prejudice to blacklisting of the responsible entities.

Section 11. Criminal Liability. The responsible officers and employees of any
establishment or organization who willfully commits any of the prohibited acts under
Section 30 of EEC Act shall upon conviction, suffer the penalty of one (1) year to five
(5) years or a fine ranging from a minimum of One hundred thousand pesos
(P100,000.00) to One hundred million pesos (P100,000,000.00) or twice the amount
of costs avoided for noncompliance, whichever is higher, or both, upon the discretion
of the court.

Any person who willfully aids or abets the commission of the prohibited acts, under
Section 30 of the EEC Act or who causes the commission of such acts by another,
shall be liable in the same manner as the principal.

In cases of association, partnership or corporation, the penalty shall be imposed on
the partner, president, chief operating officer, chief executive officer, director, officer
responsible for the violation.

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Section 12. Information, Education and Communication Activities. Pursuant to
Section 85 of the EEC IRR. the DOE shall develop and undertake a national
awareness and advocacy program covering energy efficiency and conservation and
pursue partnership with relevant stakeholders for the appreciation of this Department
Circular.

Section 13. Repealing Clause. The provisions of other circulars, orders, issuances,
rules and regulations, which are inconsistent with the provisions of this Department
Circular are hereby repealed, amended, modified or superseded accordingly.

Section 14. Separability Clause. If for any reason, any section or provision of this
Department Circular is declared unconstitutional or invalid, such parts not affected
shall remain in full force and effect.

Section 15. Effectivity. This Department Circular shall take effect fifteen (15) days
following its publication in at least two (2) newspapers of general circulation. A copy
of this Department Circular shall be filed with the University of the Philippines

Law Center - Office of the National Administrative Register.

Issued at Energy Center, Bonifacio Global City, Taguig City.

ONSO\e~cuSI
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EUMB -— AFETD
Quality Management System

SCHEDULE OF FINES AND PENALTIES
(ANNEX A)

SCHEDULE OF FINES AND PENALTIES

Prior to the imposition of the following penalties and fines, measures stated in Section 14 of
the PELP Department Circular shall first be considered (explain, recommend, disclose, order):
Violation
10,000-200,000 200,000-500,000 500, 000-1,000,000

Failure to comply 2nd Offense 3rd Offense

with energy labels

Removing, defacing | 1st Offense 2nd Offense 3rd Offense

or altering any

energy label on the
|ECPs before the

product is sold to the
first retail purchaser

or leased to the first

lessee

Failure to provide! 1st Offense

accurate information |
or the provision of
false or misleading

information as

required to be

subinitted under the | |
EEC Act and the

EECIRR
Selling, leasing or | 1st Offense 2nd Offense 3rd Offense
importing transport
vehicles that do not
| comply with PELP |

and MEP

Willfully refusing to | 1st Offense 2nd Offense 3rd Offense
submit to an on-site
inspection

Failure or willfully | 1st Offense 2nd Offense 3rd Offense
refusing to submit

any of the reports

equired therein

Failure to comply | 1st Offense 2nd Offense 3rd Offense
with issued orders of |
the DOE in the

| } | i
discharge of _ its
enforcement ‘s

2nd Offense 3rd Offense

|

Reproduction of this Document is not allowed, unless ved by the DOE-EUMB Office of the Director

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