=== dc2021-10-0032-pages-1.ppm === DEPARTMENT CIRCULAR NO. DC2021-10 - 0032 ADOPTING THE RENEWABLE ENERGY MARKET (REM) MANUALS WHEREAS, Republic Act (RA) No. 7638, otherwise known as the “Department of Energy (DOE) Act of 1992," declares as a policy of the State to, among others, ensure the continuous, adequate and economic supply of energy through the integrated and intensive exploration, production, management and development of the country's indigenous energy resources; WHEREAS, RA No. 9136, otherwise known as the “Electric Power Industry Reform Act of 2001,” declares as a policy of the State to, among others, promote the utilization of indigenous and new and renewable energy resources in power generation in order to reduce dependence on imported energy; WHEREAS, one of the functions of the DOE under RA No. 9136 is to supervise and contro! all government activities relative to energy projects to attain the goals embodied in Section 2 of RA No. 7638; WHEREAS, RA No. 9513, otherwise known as the “Renewable Energy Act of 2008" or the “RE Act,” declares as a policy of the State to increase the utilization of renewable energy (RE) by institutionalizing the development of national and local capabilities in the use of RE systems, and promoting their efficient and cost- effective commercial application by providing fiscal and non-fiscal incentives; WHEREAS, Section 6, Chapter Hil of the RE Act enjoins all stakeholders in the electric power industry to contribute to the growth of the RE industry in the country and mandates the National Renewable Energy Board to set a minimum percentage of generation from eligible RE resources and determine to which sector the Renewable Portfolio Standards (RPS) shall be imposed on a per grid basis, within one (1) year from effectivity of the Act: WHEREAS, Section 4, Rule 2, Part li of the Impiementing Rules and Regulations of the RE Act (RE Act IRR) provides that the RPS, as a policy mechanism, shall oblige electric power industry participants such as Distribution Utilities for their Captive Customers, Retail Electricity Suppliers for their Contestable Customers, and Generation Companies, in so far as their directly-connected customers are concerned, to source or produce a fraction of their electricity from eligible RE resources; WHEREAS, Department Circular (DC) Nos. DC2017-12-0015 and DC2018-08- 0024 were issued by the DOE, which prescribe the rules and guidelines governing the establishment of the RPS for On-Grid Areas (RPS On-Grid Rules) and RPS Rules Off-Grid Areas (RPS Off-Grid Rules), respectively; Energy Center, Rizal Drive cor. 34th Street, Bonifacio Global City, Taguig City, Philippines 1632 Tel. Nos. _(Trunkline) (632)479-2900; Wiohoitas Vite Shee sees oR mails in falednn eae oh === dc2021-10-0032-pages-2.ppm === WHEREAS, Section 8 of the RE Act directs the DOE to establish the Renewable Energy Market (REM) to facilitate the compliance of Mandated Participants with the RPS. Further, the Philippine Electricity Market Corporation (PEMC) is directed to, under the supervision of the DOE, establish a Renewable Energy Registrar (RER) within one (1) year from the effectivity of the RE Act and the RER shall issue, keep, and verify RE Certificates (REC) corresponding to energy generated from eligible RE facilities, which will be used for compliance with the RPS Rules for both on-grid and off-grid areas; WHEREAS, on 04 December 2019, the DOE issued DC No. DC2019-12-0016 promuigating the REM Rules; WHEREAS, Clause 7.1.1.1(a) of the REM Rules provides that the REM Governance Committee (RGC), a committee within the PEMC’s governing board (PEM Board), shall oversee the REM Rules and Manual Change process in consultation with the PEM Board; WHEREAS, Clause 1.3.4.1(e) of the REM Rules provides that the RGC shall approve or disapprove Manual Change Proposals and refer approved REM Manual changes to the PEM Board for endorsement to the DOE for final approval and promulgation in accordance with the process prescribed in Chapter 7 of the REM Rules: WHEREAS, to operationalize the relevant provisions in the REM Rules for the implementation of the REM, PEMC submitted to the RGC the proposed REM Manuals on the following: i. Registration; ii. Allocation of RE Certificates for FiT Eligible RE Generation; ii, Investigation Procedures and Penalty; and v. Dispute Resolution. WHEREAS, after due deliberations, the RGC approved the foregoing proposed REM Manuals, incorporating the Committee's revisions, and endorsement of the said REM Manuals to the PEM Board through the following resolutions: . . Date of REM Manual Title RGC Resolution No. i. Registration RGC-RESO-2020-02 | 25 March 2020 ii. Allocation of RE Certificates for FiT- Eligible RE Generation | *CC-RESO-2020-08 | 29 March 2020 iii. Investigation Procedures and RGC-RESO-2020-04 41 June 2020 Penalt iv. Dispute Resolution RGC-RESO-2020-05 | 14 August 2020 === dc2021-10-0032-pages-3.ppm === WHEREAS, upon endorsement by the RGC, the PEM Board deliberated, adopted, and approved the proposed REM Manuals and their endorsement to the DOE i, Registration 29 April 2020 FIT- Eligible RE iv. Dispute Resolution 2020-27-03 Manuals: (1) Registration, and (2) Allocation of RE Certificates for FiT-Eligible RE through the following PEM Board Resolutions: li. Allocation of RE 2020-23-17 Generation WHEREAS, the DOE, in coordination with PEMC, conducted a public consultation Generation; Date of Endorsement to the DOE 09 June 2020 29 April 2020 09 June 2020 . PEMB Date of REM Manual Title Resolution No Certificates for iii. investigation Procedures and 2020-25-08 24 June 2020 07 July 2020 Penalt on 09 December 2020 to solicit comments on the following proposed REM WHEREAS, the DOE, in coordination with PEMC, conducted another public consultation on 11 December 2020 to solicit comments on the following proposed REM Manuals: (1) Investigation Procedures and Penalty, and (2) Dispute Resolution; WHEREAS, the DOE consolidated all the comments received during the public consultations and provided the same to PEMC, including comments of the DOE, for PEMC to address and respond to; WHEREAS, on 17 and 26 March 2021 and 8 July 2021, DOE and PEMC discussed the latter's responses to the comments on the proposed REM Manuals which were provided immediately following the above-mentioned public consultations; WHEREAS, following the discussions in the aforesaid meetings held between the DOE and PEMC, the proposed REM Manuals were revised and transmitted by PEMC to the DOE on 15 July 2021, for the latter’s final review, approval, and promulgation: NOW, THEREFORE, the foregoing premises considered, the DOE issues and promulgates the following: === dc2021-10-0032-pages-4.ppm === Section 1. Approval and Adoption of the REM Manuals. The manuals listed below and attached as Annexes to this Circular are hereby approved and adopted: a) Annex “A” — REM Registration Manual; b) Annex“B” — REM Allocation of RE Certificates for FiT-Eligible RE Generation; c) Annex“C” — REM Investigation Procedures and Penalty Manual; and d) Annex“D" — REM Dispute Resolution. Section 2. Separability Clause. !f any provision of this Circular or the attached REM Manuals is declared invalid or unconstitutional by any court of competent jurisdiction, such parts or provisions not affected by such declaration shall remain valid and in full force. Section 3. Repealing Clause. All previous issuances, rules and regulations inconsistent with this Circular are hereby repealed, amended or modified accordingly. Section 4. Effectivity. This Circular shall take effect fifteen (15) days after publication in at least two (2) newspapers of general circulation. Copies of this Circular shall be filed with the University of the Philippines Law Center-Office of the National Administrative Register. Republic of the Philippines Lg DEPARTMENT OF ENERGY oO IM REPLYING PLS. CITE: et veretary Issued on OCTO4 20271 , at Energy Center, Rizal Drive, Bonifacio Global City, Taguig City.