FIVE energy-generating companies have committed to seal a deal that will allow the Cebu Provincial Government to have direct access to its shares from total electricity sales.
The move came a month after Therma Visayas Inc. (TVI) signed a memorandum of agreement (MOA) with Gov. Gwendolyn Garcia in October 2019, allowing the Province to take its share of TVI’s total electricity sales.
Garcia met with the officials of First Toledo Solar Energy Corp., Korea Electric Power Corp. (KSPC), Bantayan Island Power Corp., Global Business Power, Aboitiz Power Corp. and the Department of Energy (DOE) on Wednesday, Nov. 19, to discuss the matter.
“They all agreed that we will sign a MOA next Friday (Nov. 29). They also committed that they will compute how much they need to remit,” she said on Friday, Nov. 22.
But before that, the Provincial Board (PB) would have to authorize the governor to enter into a MOA with the energy firms for and on behalf of the Capitol.
Garcia said a resolution on the matter has been included in the PB’s agenda for its second out-of-town regular session in San Francisco town, Camotes on Monday, Nov. 25.
The Capitol will open trust fund accounts for its shares from 2017 until 2019. Its shares from years before 2017, on the other hand, will be remitted by the DOE.
As of Nov. 22, KSPC is the only firm that has submitted a report on its estimated shares for the Province. Around P17 million is expected from KSPC. The other four power companies are still finalizing their reports.
On Aug. 7, 2018, the DOE issued Circular 2018-08-0021, which amends the implementing rules and regulations of Rule 29 (a) of the Electric Power Industry Reform Act of 2001. The circular follows Section 5 (i) of Republic Act 7638 (Department of Energy Act of 1992). The law mandates the DOE to devise ways and means of giving direct benefits to the province, city, or municipality, especially the community and people affected and equitable and preferential to the region that hosts the energy resource and or energy-generating facility.
Section 6 of the circular states that the financial benefit shall be allocated in the following manner: 25 percent of one centavo per kilowatt-hour (kWh) for Development and Livelihood Fund (DLF); and 25 percent of P0.0025/kWh for reforestation, watershed management, health and for environment enhancement fund (RWMHEEF).
The DLF and RWMHEEF shall be allocated in the following manner: community and people affected (five percent), host barangays (20 percent), host municipalities or cities (35 percent), host provinces (30 percent), host Indigenous Cultural Communities/Indigenous Peoples (five percent), and host region (five percent). (RTF)