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Republic of the Philippines
DEPARTMENT OF ENERGY
(Kagawaran ng Enerhiya)

DEPARTMENT CIRCULAR NO._0C2023-12- 0035 pe

PRESCRIBING THE POLICY AND GENERAL FRAMEWORK ON
THE EXPANDED ROOF-MOUNTED SOLAR PROGRAM IN THE PHILIPPINES

WHEREAS, Republic Act (RA) No. 7638, or the “Department of Energy (DOE) Act of
1992”, declares the policy of the State to, among others, ensure a 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, Section 4 of RA 7638 mandates the DOE to Carry, prepare, integrate,
coordinate, supervise, and control all plans, programs, projects, and activities of the
Government relative to energy expioration, development, utilization, distribution, and
conservation;

WHEREAS, RA 9136, or the “Electric Power Industry Reform Act of 2001” (EPIRA),
declares the policy of the State to, among others: (i) ensure the quality, reliability,
security and affordability of the supply of electric power: (ii) assure socially and
environmentally compatible energy sources and infrastructure: (ii) promote the
utilization of indigenous and new and renewable energy (RE) resources in power
generation in order to reduce dependence on imported fuel; and (iv) encourage the

efficient use of energy and other modalities of demand side management;

WHEREAS, RA 9513, or the “Renewable Energy Act of 2008” (RE Act), declares the
policy of the State to accelerate the exploration, development, and utilization Of RE
resources including hybrid systems, to, among others, reduce the country’s
dependence on imported fuels;

WHEREAS, the DOE's 2020-2040 National Renewable Energy Program (NREP), in
line with the thrust of the 2020-2040 Philippine Energy Plan (PEP), sets the target of

35% RE share in the power generation mix by 2030 and aspires to increase it to at
least 50% by 2040;

WHEREAS, RA 11285, or the “Energy Efficiency and Conservation Act” (EEC Act),
declares the policy of the State to institutionalize energy efficiency and conservation,

enhance the efficient use of energy, and grants incentives to energy efficiency and
conservation projects;

WHEREAS, as of end of 2022, the share of RE in the country’s installed capacity and
Power generation mix is at 30% and 22%, respectively;

WHEREAS, the DOE recognizes the potential use of rooftops as venue to increase
RE generation through solar photovoltaic (PV) technology and further promote solar
roof-mounted technologies to empower more Electricity End-Users/building
establishments, and augment power supply in the country, both for on-grid and off-grid

areas;
Energy Center, Rizal Drive cor. 34th Street, Bonifacio Global City, Taguig City, Philippines 1632

Tel. No. (Trunkline) (632) 8479-2900
h

Website: ttp:/www.doe.gov ph: Email: info@doe.gov.ph

=== dc2023-12-0035-pages-02.ppm ===
TSI SE —C__eeE,:—:,_

DC No.
Re: Prescribing the Policy and General Framework on the Expanded Roof-Mounted Solar Program in
the Philippines

Page 2 of 8

NOW, THEREFORE, in consideration of the foregoing and after due review of the
views, suggestions, and recommendations received during the consultations with all
concerned stakeholders, the DOE hereby issues and adopts the following policies for
the promotion development and implementation of a comprehensive roof-mounted
solar program in the country.

SECTION 1. TITLE. This Circular shall be known as “Prescribing the Policy and
General Framework on Expanded Roof-Mounted Solar Program in the Philippines” or
the “ERSP”.

SECTION 2. POLICY OBJECTIVES. The ERSP is hereby introduced and
Promulgated in pursuit of the Government's goal to Promote, develop, and
commercialize RE systems and technologies using available rooftops in the
Philippines with the following objectives:

(a) Contribute to the attainment of 35% RE share in the power generation mix by
2030 and 50% by 2040:

(b) Attract more investments in RE that will provide additional supply of electricity
through the adoption of innovative business models that create additional
market for RE Developers:

(c) Empower Electricity End-Users/building owners/establishments _ in using
rooftops and/or hosting roof-mounted RE systems, particularly solar PV
technologies;

(d) Decongest or relieve the transmission and distribution networks through

decentralization, thereby deferring grid expansions and upgrading, as
applicable;

(e) Offer an alternative compliance mechanism to building owners/ establishments
with their respective obligations under the EEC Act and its Implementing Rules

and Regulations and the Government Energy Management Program (GEMP);
and

(f) Streamline and simplify the processes and requirements in the development of
roof-mounted solar projects, consistent with the objectives of RA 11032 or the
“Ease of Doing Business and Efficient Government Service Delivery Act of
2018”, and RA 11234 or the “Energy Virtual One-Stop Shop Act’.

Program, Distributed Energy Resources Program, and Green Energy Option Program,
and shall apply for both on-grid and off-grid areas.

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SECTION 4. SCOPE. This Circular shall apply to the following:

(a) Electricity End-Users which include:
i. Captive customers;
ii. Directly Connected Customers (DCCs);
iii. Contestable Customers with RSF; and
iv. Government agencies, entities or instrumentalities authorized under
applicable laws, rules, and regulations to adopt, implement and/or
participate in the ERSP.
(b) Economic zone developers and utility enterprises;
(c) RE Developers/Generation Companies;
(d) Distribution Utilities (DUs)/Electric Cooperatives (ECs);
(e) Market Operator;
(f) Market Governance;
(g) Roof-mounted Solar Providers (RSPs);
(h) Transmission Network Provider (TNP);
(i) System Operator; and
(j) | Owners and operators of RSEs.

SECTION 5. DEFINITION OF TERMS. The terms used in this Circular shall have the
following meaning:

5.1. “Contiguous Areas” refer to areas which are within the same boundaries such
as:

5.1.1. Subdivisions;

5.1.2. Business Districts;

5.1.3. Special Economic Zones;

5.1.4. Commercial establishments such as malls;

5.1.5. Mixed-use development complexes; and

5.1.6. Such other areas where similarly situated Electricity End-Users are

located in which supply of electricity can be measured through metering
devices.

5.2. “Distribution Asset Study” or “DAS” refers to a Set of technical studies which
are used to determine all distribution assets and costs necessary to
accommodate a proposed interconnection to a Distribution System;

§.3. “Distribution Impact Study” or “DIS” refers to a set of technical Studies which
are used to assess the possible effects of a Proposed expansion,
reinforcement, or modification of the Distribution System or a user development
and to evaluate significant incidents;

5.4. “Distribution Services and Open Access Rules” or “DSOAR” refers to the
rules promulgated by the Energy Regulatory Commission (ERC) under ERC
Resolution No. 2, Series of 2010 including any subsequent amendment thereto,
covering, among others, the terms and conditions for the connection of
generating facilities to the Distribution System;

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5.5. “Electricity End-User” refers to any person or entity requiring the supply and
delivery of electricity, herein referred to as “Consumer”; Provided, that, an
Electricity End-User which has a Self-Generation RSF with a capacity above
100 kW is herein referred to as “Prosumer”:

5.6. “Peer-to-Peer Energy Trading” or “P2P Energy Trading” refers to buying
and/or selling electricity amongst RSPs, Prosumers and Consumers;

5.7. “Philippine Distribution Code” or “PDC” refers to the set of rules,
requirements, procedures, and standards governing DUs and users of
Distribution System in the operation, maintenance, and development of the
Distribution System. It also defines and establishes the relationship of the
Distribution System with the facilities or installations of the parties connected
thereto;

5.8. “Philippine Electrical Code” or “PEC” refers to the set of standards and rules
that establishes the basic materials quality and electrical works standards for
the safe use of electricity for light, heat, power, communications, signaling, and
for other purposes;

5.9. “Roof-mounted Solar Facility” or “RSF” refers to a solar PV energy
generating system, mounted on the rooftop/s of residential, commercial
building, industrial facility, or any similar Structure, which is used for own-use
and/or commercial purposes;

5.10. “Roof-mounted Solar Provider” or “RSP” refers to a natural or juridical entity
whose business includes the installation, operation, and maintenance of an
RSF. For purposes of this Circular, an RSP with a Lease-to-Generate RSF shall
be deemed a Generation Company and an RE Developer; and

5.11. “System Impact Study” or “SIs” refers to an assessment made or conducted
by the Transmission Network Provider/System Operator, in addition to the Grid
Impact Studies and in accordance with the Philippine Grid Code (PGC), to
determine the adequacy of the Grid and its capability to accommodate a
request for power delivery service and the costs, if any, that May be incurred in
order to provide power delivery service to a transmission customer.

SECTION 6. ERSP BUSINESS MODELS. This Circular sets out the policies and

guidelines on the following business models/supply augmentation framework for
RSFs:

6.1. Supply Contingency Option

6.1.1. This business model is voluntary and involves the participation of
Electricity End-Users with Self-Generation RSF of above 100 kW, opting to
export its energy generation during grid power supply shortages and/or
emergency situations only, which include, among others, Yellow and Red Alert
situations defined in the PGC;

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6.1.2. All Electricity End-Users opting to export energy generation of their RSF
to the Grid or distribution system shall be guided by the following:

6.1.2.1. To accommodate export of energy generation, all Electricity End-
Users shall update/upgrade their meter and connection through their
Metering Service Provider and Network Service Provider to conform to
the requirement of its host DU or Grid;

6.1.2.2. Any costs for the updating/upgrading of metering needed to
comply with this requirement shall be borne by the Electricity End-User,
while all connection costs shall be shouldered by the Network Service
Provider concerned; and

6.1.2.3. All Electricity End-Users that opt to export energy generated by
their RSFs during supply contingencies mentioned in Section 6.1.4
above shall enter into an agreement with the DU or TNP in the case of
DCCs, and shall be compensated by the DU or TNP, as determined by
the ERC,

6.2. Lease-to-Generate Option

6.2.1. This business model provides opportunity for interested and potential RE
developers to utilize the rooftops of buildings/establishments in contiguous
areas for RSF under lease or similar arrangements, either as Grid-connected
Generating Plant or Embedded Generator;

6.2.2. All energy generated under this business model shall only be exported
either to the DU or to the Grid, pursuant to existing policies and rules applicable
to Generation Companies. The sale of Power by the RSP to the host DU through
a Power Supply Agreement shall be in accordance with the rules and guidelines
on Competitive Selection Process or Department Circular (DC) Nos. DC2018-
02-0003 and DC2021-09-0030, and any amendments thereto;

6.2.3. Prior to installation of any Lease-to-Generate RSF, the RSP shall secure
a Solar Energy Operating Contract from the DOE in accordance with DC No.
DC2019-10-0013, or the “Omnibus Guidelines Governing the Award and
Administration of Renewable Energy Contracts and the Registration of
Renewable Energy Developers,” or any amendment thereto; and

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Restricted Peer-To-Peer Energy Trading

6.3.1. This business model applies to a confined area or within a contiguous
area where RSPs, Prosumers, and Consumers participate in electricity trading
within and/or among themselves for power supply;

6.3.2. The RSPs shall provide the appropriate trading platform for the
participants and shall be the operator of the P2P trading between Prosumers
and Consumers whereby aggregated excess electricity generated may be sold
to the host DU or Grid; Provided, that, the RSP shall enter into an agreement
with the DU or TNP and shall be compensated for the exported energy as
determined by the ERC;

6.3.3. The supply contracts/agreements between RSPs, Prosumers and
Consumers shall be non-regulated similar to retail market; and

6.3.4. The DOE shall be informed of all P2P Energy Trading Arrangements
entered into by Electricity End-Users and RSPs.

SECTION 7. GENERAL PROVISIONS

7.1.

7.2.

7.3.

7.4.

7.5

Prior to development, construction, and commercial operation of any RSF, all
RSPs shall secure applicable permits and comply with alt pertinent rules and
guidelines of the DOE and ERC, including the undertaking of a DIS conducted
by the DU or SIS by the TNP;

All connection facilities of any RSF shall follow relevant laws, codes, and
Standards including the PDC, PGC, and DSOAR, among others;

To ensure quality and Safety procedures in installing RSFs, all RSPs shall

comply and meet the safety standard requirements on Solar PV Systems under
the PEC;

As part of their compliance with the GEMP, government agencies, entities, or
instrumentalities may adopt, implement and/or Participate in the ERSP, subject
to applicable laws, rules and regulations; and

The equivalent Renewable Energy Certificates (RECs) generated by the RSFs
under this program shall be allocated in accordance with existing Renewable
Portfolio Standards (RPS) Rules or any amendment thereto.

SECTION 8. DUTIES AND RESPONSIBILITIES. Without prejudice to applicable laws,
rules, regulations, the following shall have corresponding responsibilities:

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Transmission Network Provider

8.1.1. Conduct timely SIS for Grid-connected RSF prior to construction and
commercial operations for above 20 MW capacity in Luzon and 5 MW in
Visayas and Mindanao; and

8.1.2. In consultation with the DOE, include the ERSP impacts to the Grid in
the annual update of the Transmission Development Plan.

Distribution Utilities

8.2.1. Ensure the reliability and Stability of their distribution systems to
accommodate the entry of RSFs through the conduct of DIS/DAS;

8.2.2. Perform technical studies and include possible impact of all existing and
projected ERSPs’ capacity and energy generation in their annual Distribution
Development Plan (DDP) and Power Supply Procurement Plan (PSPP)
submission to the DOE;

8.2.3. Act as the default Metering Services Provider to DU-connected RSFs
and Prosumers connected to the distribution system; and

8.2.4. Conduct further studies and simulations on the impact of RSFs under the
ERSP on the distribution network and provide recommendations to the long-
term capacity and generation expansion planning of the DOE.

Roof-mounted Solar Providers

8.3.1. Provide annual reports to the DOE on or before 30" of January, which
include information on the generation, capacity and location, and current and
Proposed business models, among others;

8.3.2. Comply with the PGC, PDC, DSOAR, and PEC and any amendments
thereto; and

8.3.3. Coordinate with the DU or TNP for the proper design and installation of

the necessary metering system and connection facility per RSF location, and
conduct SIS and DIS / DAS.

Market Operator

8.4.1. Review and/or Propose amendments to the Wholesale Electricity Spot
Market (WESM) Rules, RE Market (REM) Rules, and Retail Rules and Market
Manuals for possible integration of the ERSP to the WESM, the REM, and the
Competitive Retail Electricity Market; and

8.4.2. As may deemed necessary by the DOE, conduct further studies and
simulations on the electricity and/or WESM price impact of the ERSP.

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SECTION 9. REGULATORY SUPPORT. For the successful implementation of this
policy, the ERC shall:

9.1. Formulate rules and regulations and determine pricing methodology and
interconnection standards of the ERSP business models, within sixty (60)
calendar days after the effectivity of this Circular; and

9.2. Review and, if necessary, amend the pricing methodology of the ERSP to
ensure its continued effectiveness and alignment with prevailing market
conditions.

SECTION 10. Repealing Clause. Nothing in this Circular shall be construed as to
amend, supersede, or repeal any of the mechanism or institutions already existing or
responsibilities already allocated and provided for under any existing laws, rules, or
coniracts.

SECTION 11. 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 12. Effectivity. This Circular shall take effect immediately after its
publication in two (2) newspapers of general circulation. A copy of this Circular shall

be filed with the University of the Philippines Law Center-Office of the National
Administrative Register.

Issued on ___— December 2023 at the DOE, Energy Center, Rizal Drive comer 34th
Street, Bonifacio Global City, Taguig City.

RAPHAEL P.M. LOTILLA &
Secretary F

BEC 14 2023

=== dc2023-12-0035-pages-09.ppm ===
ats Republic of the Philippines
eo: LJ DEPARTMENT OF ENERGY

ege (Kagawaran ng Enerhiya)

DEPARTMENT CIRCULAR NO._0C2023-12-0035 he

PRESCRIBING THE POLICY AND GENERAL FRAMEWORK ON
THE EXPANDED ROOF-MOUNTED SOLAR PROGRAM IN THE PHILIPPINES

WHEREAS, Republic Act (RA) No. 7638, or the “Department of Energy (DOE) Act of
1992”, declares the policy of the State to, among others, ensure a 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, Section 4 of RA 7638 mandates the DOE to carry, prepare, integrate,
coordinate, supervise, and control all plans, programs, projects, and activities of the

Government relative to energy exploration, development, utilization, distribution, and
conservation;

WHEREAS, RA 9513, or the “Renewable Energy Act of 2008” (RE Act), declares the
policy of the State to accelerate the exploration, development, and utilization of RE

resources including hybrid Systems, to, among others, reduce the country’s
dependence on imported fuels;

WHEREAS, the DOE’s 2020-2040 National Renewable Energy Program (NREP), in
line with the thrust of the 2020-2040 Philippine Energy Plan (PEP), sets the target of

35% RE share in the power generation mix by 2030 and aspires to increase it to at
least 50% by 2040;

WHEREAS, RA 11285, or the “Energy Efficiency and Conservation Act” (EEC Act),
declares the policy of the State to institutionalize energy efficiency and conservation,

enhance the efficient use of energy, and grants incentives to energy efficiency and
conservation projects;

WHEREAS, as of end of 2022, the share of RE in the country’s installed Capacity and
power generation mix is at 30% and 22%, respectively;

WHEREAS, the DOE recognizes the potential use of rooftops as venue to increase
RE generation through solar photovoltaic (PV) technology and further promote solar
roof-mounted technologies to empower more Electricity End-Users/building
establishments, and augment power supply in the country, both for on-grid and off-grid

areas;
Energy Center, Rizal Drive cor. 34th Street, Bonifacio Global City, Taguig City, Philippines 1632

Tel. No. (Trunkline) (632) 8479-2900

Website: http://www.doe.gov.ph; Email: info@doe.gov.ph

=== dc2023-12-0035-pages-10.ppm ===
DC No. .
Re: Prescribing the Policy and General Framework on the Expanded Roof-Mounted Solar Program in
the Philippines

Page 2 of 8

NOW, THEREFORE, in consideration of the foregoing and after due review of the
views, suggestions, and recommendations received during the consultations with all
concerned stakeholders, the DOE hereby issues and adopts the following policies for
the promotion development and implementation of a comprehensive roof-mounted
solar program in the country.

SECTION 1. TITLE. This Circular shall be known as “Prescribing the Policy and
General Framework on Expanded Roof-Mounted Solar Program in the Philippines’ or
the “ERSP”.

SECTION 2. POLICY OBJECTIVES. The ERSP is hereby introduced and
promulgated in pursuit of the Government's goal to promote, develop, and
commercialize RE systems and technologies using available rooftops in the
Philippines with the foliowing objectives:

(a) Contribute to the attainment of 35% RE share in the power generation mix by
2030 and 50% by 2040:

(b) Attract more investments in RE that will provide additional supply of electricity
through the adoption of innovative business modeis that create additional
market for RE Developers;

(c) Empower Electricity End-Users/building owners/establishments in using

rooftops and/or hosting roof-mounted RE systems, particularly solar PV
technologies;

(d) Decongest or relieve the transmission and distribution networks through

decentralization, thereby deferring grid expansions and upgrading, as
applicable;

(e) Offer an alternative compliance mechanism to building owners/ establishments
with their respective obligations under the EEC Act and its Implementing Rules

and Regulations and the Government Energy Management Program (GEMP);
and

(f) Streamline and simplify the processes and requirements in the development of
roof-mounted solar projects, consistent with the objectives of RA 11032 or the

“Ease of Doing Business and Efficient Government Service Delivery Act of
2018”, and RA 11234 or the “Energy Virtual One-Stop Shop Act’.

SECTION 3. COVERAGE. This Circular shall prescribe the rules and guidelines for all
roof-mounied solar energy generating facilities with a capacity of above one hundred-
kilowatt peak (100 kWp), intended for own-use and/or export of energy to its host
distribution utility (DU) or to the Grid. The ERSP shall be distinct from the Net-Metering
Program, Distributed Energy Resources Program, and Green Energy Option Program,
and shall apply for both on-grid and off-grid areas.

=== dc2023-12-0035-pages-11.ppm ===
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Page 3 of 8
SECTION 4. SCOPE. This Circular shall apply to the following:

(a) Electricity End-Users which include:

i. Captive customers;

li. Directly Connected Customers (DCCs);

iii. Contestable Customers with RSF; and

iv. Government agencies, entities or instrumentalities authorized under
applicable laws, rules, and regulations to adopt, implement and/or
participate in the ERSP.

Economic zone developers and utility enterprises;

RE Developers/Generation Companies;

Distribution Utilities (DUs)/Electric Cooperatives (ECs);

Market Operator;

Market Governance;

Roof-mounted Solar Providers (RSPs);

Transmission Network Provider (TNP);

System Operator; and

Owners and operators of RSFs.

SECTION 5. DEFINITION OF TERMS. The terms used in this Circular shall have the
following meaning:

5.1. “Contiguous Areas” refer to areas which are within the same boundaries such

as:

5.1.1. Subdivisions;

5.1.2. Business Districts;

§.1.3. Special Economic Zones;

5.1.4. Commercial establishments such as malls;

5.1.5. Mixed-use development complexes; and

5.1.6. Such other areas where similarly situated Electricity End-Users are

located in which supply of electricity can be measured through metering
devices.

“Distribution Asset Study” or “DAS” refers to a set of technical studies which
are used to determine all distribution assets and costs necessary to
accommodate a proposed interconnection to a Distribution System;

“Distribution Impact Study” or “DIS” refers to a set of technical studies which
are used to assess the possible effects of a Proposed expansion,
reinforcement, or modification of the Distribution System or a user development
and to evaluate significant incidents;

“Distribution Services and Open Access Rules” or “DSOAR” refers to the
rules promulgated by the Energy Regulatory Commission (ERC) under ERC
Resolution No. 2, Series of 2010 including any subsequent amendment thereto,
covering, among others, the terms and conditions for the connection of
generating facilities to the Distribution System;

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5.5. “Electricity End-User” refers to any person or entity requiring the supply and
delivery of electricity, herein referred to as “Consumer”, Provided, that, an
Electricity End-User which has a Self-Generation RSF with a capacity above
100 kW is herein referred to as “Prosumer’:

5.6. “Peer-to-Peer Energy Trading” or “P2P Energy Trading” refers to buying
and/or selling electricity amongst RSPs, Prosumers and Consumers;

5.7. “Philippine Distribution Code” or “PDC” refers to the set of rules,
requirements, procedures, and standards governing DUs and users of
Distribution System in the operation, maintenance, and development of the
Distribution System. It also defines and establishes the relationship of the
Distribution System with the facilities or installations of the parties connected
thereto;

5.8. “Philippine Electrical Code” or “PEC” refers to the set of standards and rules
that establishes the basic materials quality and electrical works standards for

the safe use of electricity for light, heat, power, communications, signaling, and
for other purposes;

5.9. “Roof-mounted Solar Facility” or “RSF” refers to a solar PV energy
generating system, mounted on the rooftop/s of residential, commercial
building, industrial facility, or any similar structure, which is used for own-use
and/or commercial purposes:

5.10. “Roof-mounted Solar Provider” or “RSP” refers to a natural or juridical entity
whose business includes the installation, operation, and maintenance of an
RSF. For purposes of this Circular, an RSP with a Lease-to-Generate RSF shall
be deemed a Generation Company and an RE Developer; and

5.11. “System Impact Study” or “SIS” refers to an assessment made or conducted
by the Transmission Network Provider/System Operator, in addition to the Grid
Impact Studies and in accordance with the Philippine Grid Code (PGC), to
determine the adequacy of the Grid and its Capability to accommodate a
request for power delivery service and the costs, if any, that may be incurred in
order to provide power delivery service to a transmission customer.

SECTION 6. ERSP BUSINESS MODELS. This Circular sets out the policies and

guidelines on the following business models/supply augmentation framework for
RSFs:

6.1. Supply Contingency Option

6.1.1. This business model is voluntary and involves the Participation of
Electricity End-Users with Self-Generation RSF of above 100 kW, opting to
export its energy generation during grid power supply shortages and/or
emergency situations only, which include, among others, Yellow and Red Alert
situations defined in the PGC;

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6.2.

Page 5 of 8

6.1.2. All Electricity End-Users opting to export energy generation of their RSF
to the Grid or distribution system shall be guided by the following:

6.1.2.1. To accommodate export of energy generation, all Electricity End-
Users shall update/upgrade their meter and connection through their
Metering Service Provider and Network Service Provider to conform to
the requirement of its host DU or Grid;

6.1.2.2. Any costs for the updating/upgrading of metering needed to
comply with this requirement shall be borne by the Electricity End-User,
while all connection costs shall be shouldered by the Network Service
Provider concerned; and

6.1.2.3. All Electricity End-Users that opt to export energy generated by
their RSFs during supply contingencies mentioned in Section 6.1.1
above shall enter into an agreement with the DU or TNP in the case of
DCCs, and shall be compensated by the DU or TNP, as determined by
the ERC.

Lease-to-Generate Option

6.2.1. This business model provides opportunity for interested and potential RE
developers to utilize the rooftops of buildings/establishments in contiguous
areas for RSF under lease or similar arrangements, either as Grid-connected
Generating Plant or Embedded Generator;

6.2.2. All energy generated under this business model shall only be exported
either to the DU or to the Grid, pursuant to existing policies and rules applicable
to Generation Companies. The sale of power by the RSP to the host DU through
a Power Supply Agreement shall be in accordance with the rules and guidelines
on Competitive Selection Process or Department Circular (DC) Nos. DC2018-
02-0003 and DC2021-09-0030, and any amendments thereto;

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6.3.

Page 6 of 8
Restricted Peer-To-Peer Energy Trading

6.3.1. This business mode! applies to a confined area or within a contiguous
area where RSPs, Prosumers, and Consumers participate in electricity trading
within and/or among themselves for power supply;

6.3.2. The RSPs shall provide the appropriate trading platform for the
participants and shall be the operator of the P2P trading between Prosumers
and Consumers whereby aggregated excess electricity generated may be sold
to the host DU or Grid; Provided, that, the RSP shall enter into an agreement
with the DU or TNP and shall be compensated for the exported energy as
determined by the ERC;

6.3.3. The supply contracts/agreements between RSPs, Prosumers and
Consumers shall be non-regulated similar to retail market: and

6.3.4. The DOE shall be informed of all P2P Energy Trading Arrangements
entered into by Electricity End-Users and RSPs.

SECTION 7. GENERAL PROVISIONS

7.1.

7.2.

7.3.

7.4,

7.5

All connection facilities of any RSF shall follow relevant laws, codes, and
standards including the PDC, PGC, and DSOAR, among others;

To ensure quality and Safety procedures in installing RSFs, all RSPs shall

comply and meet the Safety standard requirements on Solar PV Systems under
the PEC;

As part of their compliance with the GEMP. government agencies, entities, or
instrumentalities may adopt, implement and/or Participate in the ERSP. subject
to applicable laws, rules and regulations; and

The equivalent Renewable Energy Certificates (RECs) generated by the RSFs
under this program shall be allocated in accordance with existing Renewable
Portfolio Standards (RPS) Rules or any amendment thereto.

SECTION 8. DUTIES AND RESPONSIBILITIES. Without prejudice to applicable laws,
rules, regulations, the following shall have corresponding responsibilities:
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8.1. Transmission Network Provider

8.1.1. Conduct timely SIS for Grid-connected RSF prior to construction and
commercial operations for above 20 MW capacity in Luzon and 5 MW in
Visayas and Mindanao; and

8.1.2. In consultation with the DOE, include the ERSP impacts to the Grid in
the annual update of the Transmission Development Plan.

Distribution Utilities

8.2.1. Ensure the reliability and Stability of their distribution systems to
accommodate the entry of RSFs through the conduct of DIS/DAS;

8.2.2. Perform technical studies and include possible impact of all existing and
projected ERSPs’ capacity and energy generation in their annual Distribution
Development Plan (DDP) and Power Supply Procurement Pian (PSPP)
submission to the DOE:

8.2.3. Act as the default Metering Services Provider to DU-connected RSFs
and Prosumers connected to the distribution system; and

8.2.4. Conduct further studies and simulations on the impact of RSFs under the
ERSP on the distribution network and provide recommendations to the long-
term capacity and generation expansion planning of the DOE.

Roof-mounted Solar Providers

8.3.1. Provide annual. reports to the DOE on or before 30 of January, which
include information on the generation, capacity and location, and current and
proposed business models, among others;

8.3.2. Comply with the PGC, PDC, DSOAR, and PEC and any amendments
thereto; and

8.3.3. Coordinate with the DU or TNP for the proper design and installation of

the necessary metering system and connection facility per RSF location, and
conduct SIS and DIS / DAS.

Market Operator

8.4.1. Review and/or propose amendments to the Wholesale Electricity Spot
Market (WESM) Rules, RE Market (REM) Rules, and Retail Rules and Market
Manuals for possible integration of the ERSP to the WESM, the REM, and the
Competitive Retail Electricity Market; and

8.4.2. As may deemed necessary by the DOE, conduct further studies and
simulations on the electricity and/or WESM price impact of the ERSP.

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SECTION 9. REGULATORY SUPPORT. For the successful implementation of this
policy, the ERC shall:

9.1. Formulate rules and regulations and determine pricing methodology and
interconnection standards of the ERSP business models, within sixty (60)
calendar days after the effectivity of this Circular; and

9.2. Review and, if necessary, amend the pricing methodology of the ERSP to
ensure its continued effectiveness and alignment with prevailing market
conditions.

SECTION 10. Repealing Clause. Nothing in this Circular shall be construed as to
amend, supersede, or repeal any of the mechanism or institutions already existing or
responsibilities already allocated and provided for under any existing laws, rules, or
contracts.

SECTION 11. 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 12. Effectivity. This Circular shall take effect immediately after its
publication in two (2) newspapers of general circulation. A copy of this Circular shall

be filed with the University of the Philippines Law Center-Office of the National
Adminisirative Register.

Issued on ___— December 2023 at the DOE, Energy Center, Rizal Drive corner 34th
Street, Bonifacio Global City, Taguig City.

RAPHAEL P.M. LOTILLA
Secretary E

DEC 14 2023