# DC2020-04-0009 — Guidelines Governing the Issuance of Operating Permits to Renewable Energy Suppliers under the Green Energy Option Program ## Department Circular No. DC2020-04-0009 Signed: 22 April 2020 by DOE Secretary Alfonso G. Cusi Effectivity: Fifteen (15) days following publication in at least two (2) newspapers of general circulation and filing with the National Administrative Register of the UP Law Center --- ## WHEREAS RECITALS 1. RA 7638 (Department of Energy Act of 1992), as amended, Section 2 mandates DOE to prepare, integrate, coordinate, supervise and control all government plans, programs, projects and activities relative to energy exploration, development, utilization, distribution and conservation. 2. RA 9513 (RE Act) declares as State policy the acceleration of RE Resources exploration and development to achieve energy self-reliance through sustainable energy development strategies. 3. RE Act Section 9 provides that DOE shall establish a Green Energy Option Program (GEOP), giving end-users the option to choose RE Resources as their source of energy. 4. On 18 July 2018, DOE issued DC2018-07-0019, "Promulgating the Rules and Guidelines Governing the Establishment of the Green Energy Option Program Pursuant to Renewable Energy Act of 2008," establishing the GEOP ("GEOP Rules"). 5. The second paragraph of GEOP Rules Section 11(a)(i) provides that DOE shall, after public consultation, promulgate the necessary guidelines and procedures for issuance of permits to RE Suppliers. 6. DOE and the National Renewable Energy Board (NREB) conducted public consultations on the draft GEOP Operating Permit Guidelines on 18 June 2019 (Cebu), 27 June 2019 (Davao), 11 July 2019 (Batangas), and 25 July 2019 (Pampanga). --- ## OPERATIVE PROVISIONS **Section 1. Title.** This Circular is known as the "Guidelines for the Issuance of Operating Permits for RE Suppliers under the Green Energy Option Program," referred to as the "GEOP Operating Permit Guidelines." **Section 2. Coverage.** Prescribes the guidelines and procedures for issuance, administration, and revocation of GEOP Operating Permits to RE Suppliers. All GEOP contracts must cover a minimum of 100 kW, regardless of the percentage of demand the End-User requires it for. **Section 3. Scope.** Applies to: End-Users; RE Developers; RE Suppliers; Distribution Utilities; Retail Electricity Suppliers; PEMC and/or the Independent Market Operator; Supplier of Last Resort; Central Registration Body; RE Registrar; National Grid Corporation of the Philippines; National Transmission Corporation; ERC-licensed Metering Service Providers; and other entities later created or identified as relevant to GEOP implementation. **Section 4. Definition of Terms.** Adopts by reference the terms defined in RA 9136, the RE Act, their IRRs, the GEOP Rules, and other relevant DOE Circulars. Additional terms defined for this Circular: - **Certificate of Registration (COR)** — official DOE document issued to any individual or juridical entity engaged in RE Resources development, utilization, and commercialization (own-use or commercial), awarded an RE Contract after satisfying all requirements. - **Contestable Customer** — electricity end-user with a choice of electricity supplier, as determined by ERC per RA 9136. - **End-User** — any person or entity requiring electricity supply for its own use; for this Circular, one that chooses RE Resources as its energy source, provided it satisfies the eligibility requirements under GEOP Rules Rule 2, Section 6. - **GEOP Supply Contract** — agreement between an End-User and an RE Supplier for supply of RE-generated electricity, containing at minimum: (1) contract period; (2) name of End-User and location; (3) name of RE Supplier and RE supply source; (4) guaranteed demand (kW/MW) and energy (kWh/MWh); (5) contract price; (6) payment terms; (7) Replacement Power provision; (8) default provision; and (9) other charges, segregated and itemized. - **GEOP Operating Permit** — document issued by DOE to an entity allowing supply of electric power to an End-User pursuant to this Circular. - **Renewable Energy Facility (RE Facility)** — any power plant generating electricity using RE Resources. - **Replacement Power** — provision in a GEOP Supply Contract, delivered to the End-User: (1) whenever the contracted RE Resource is unavailable due to scheduled preventive maintenance; or (2) whenever needed to address the variability of the RE technology supplying the End-User. - **RE Registrar (RER)** — entity designated by DOE to establish and operate the RE Market under RE Act Section 8 and DC2019-12-0016 (REM Rules). **Section 5. RE Supplier Qualifications.** 5.1. Any person, natural or juridical, registered/authorized to operate in the Philippines and engaged in generating and/or supplying electricity from RE Resources may apply for a GEOP Operating Permit as an RE Supplier. 5.2. Any RE Facility is eligible for GEOP whether or not it is eligible for Renewable Portfolio Standards (RPS) compliance, so long as capacity or energy remains available for GEOP supply. 5.3. Owners/operators of RE Facilities constructed and operating prior to the RE Act, but registered under it, may qualify as RE Suppliers under GEOP. **Section 6. Application Requirements.** Written and verified applications must include: (1) an affidavit of undertaking on capability to supply and deliver the RE generation to the End-User; (2) proof of a Replacement Power supply contract per Section 10.1; and (3) proof of payment of the processing fee. **Section 7. Qualification for Existing Retail Electricity Suppliers.** A person/entity holding an ERC Retail Electricity Supplier's license, demonstrated able to serve its Contestable Customer under RCOA, may be automatically issued a GEOP Operating Permit as RE Supplier upon submitting: (1) a billing document from at least one Contestable Customer for the two years preceding the application (or a sworn statement attesting a contract covering that period); (2) an affidavit of undertaking on supply capability; (3) proof of a Replacement Power supply contract per Section 10.1; and (4) proof of payment of the processing fee. **Section 8. Processing and Approval of Applications.** 8.1. DOE, through the Renewable Energy Management Bureau (REMB), evaluates all GEOP Operating Permit applications. 8.2. Within 20 working days from submission of complete application documents, the REMB Director recommends approval or disapproval to the Secretary. 8.3. The application is acted upon by the DOE Secretary upon endorsement by the Supervising Assistant Secretary and Undersecretary of REMB. **Section 9. Obligations of RE Suppliers.** RE Suppliers under GEOP must: (1) comply with the GEOP Operating Permit's terms, this Circular, and the GEOP Rules; (2) submit annual reports to REMB on or before 30 January, containing total kWh generated from owned/operated RE Facilities, total kWh purchased per RE Resource, total kWh sold per customer, and total kWh purchased for Replacement Power on an hourly basis; (3) ensure total power dispatched from its RE Facilities is always ≥ total kWh sold to its customers; (4) register in the WESM and with the Central Registration Body before supplying electric power to eligible End-Users; and (5) register with the RE Registrar pursuant to the RE Market Rules. **Section 10. Provision of Replacement Power.** 10.1. During the first two years of this Circular's implementation, an RE Supplier may contract Replacement Power from generation facilities using indigenous resources; thereafter, Replacement Power must be sourced exclusively from RE Resources. 10.2. For hybrid RE technologies (e.g., solar and battery energy storage systems), Replacement Power is only required during the facility's maintenance periods. **Section 11. Period of Validity.** A GEOP Operating Permit is valid for five (5) years from its date of issuance, unless earlier revoked by DOE for a violation of the GEOP Rules or this Circular. **Section 12. Renewal of Application.** An RE Supplier may apply for renewal six (6) months prior to expiration, upon submission of required documents and payment of a renewal fee. DOE determines compliance with all requirements under this Circular. **Section 13. Suspension, Revocation or Cancellation of GEOP Operating Permits.** DOE may suspend, revoke, or cancel a GEOP Operating Permit on these grounds: (1) failure to comply with GEOP Rules obligations or the Operating Permit's terms and conditions; (2) providing false or misleading information to the End-User or DOE; (3) failure to respond to DOE directives/communications/inquiries within the required period, or to address customer complaints within five working days of receipt; and (4) termination of the GEOP Supply Contract by the End-User for cause. Upon a positive finding of any ground above, the RE Supplier must explain in writing, within a non-extendible 15 calendar days, why its permit should not be suspended, revoked, or cancelled, supported by documents. Within 15 working days of receiving that explanation, REMB submits findings and recommendations to the DOE Secretary through the Supervising Assistant Secretary and Undersecretary. The Secretary has five working days to act; the decision is final and immediately executory. The RE Supplier is notified in writing within three days of REMB's receipt of the decision, via personal service, registered mail, private courier, or (absent those) electronic mail. **Section 14. Penalties.** For a violation under Section 13 without adequate justification: (1) First Offense — one-month suspension of the GEOP Operating Permit; (2) Second Offense — three-month suspension; (3) Third Offense — cancellation/revocation. Where the RE Supplier is found to have twice committed the same violation in succession, the permit is cancelled/revoked. **Section 15. RE Pool.** To accelerate RE Resources exploration, development, and utilization, and ensure least-cost RE supply availability, RE Suppliers and RE Generators/Developers may enter joint action or establish an RE supply pool under GEOP, to the extent permitted by applicable law. **Section 16. Separability Clause.** If any provision is declared unconstitutional or invalid, unaffected parts remain in full force and effect. **Section 17. Repealing Clause.** Provisions of other department circulars inconsistent with this Circular are repealed, amended, or modified accordingly. **Section 18. Effectivity.** Takes effect fifteen (15) days following publication in at least two (2) newspapers of general circulation and filing with the National Administrative Register of the UP Law Center. Issued on 22 April 2020, at the Department of Energy, Energy Center, Merritt Road, Fort Bonifacio, Taguig City, Metro Manila. **ALFONSO G. CUSI** Secretary, Department of Energy