Foreign citizens or foreign-owned entities can soon engage in the exploration, development and utilization of the country’s renewable energy (RE) resources following the amendment of Section 19 of the Implementing Rules and Regulations (IRR) of the Renewable Energy Act of 2008.
Energy Secretary Raphael Lotilla signed on Tuesday Department Circular No. 2022-11-0034 which prescribes the amendment that will take effect for projects utilizing solar, wind, biomass, ocean or tidal energy resources.
The circular will take effect 15 days upon its publication, and filing with the University of the Philippines Law Center-Office of the National Administrative Register.
The Department of Energy’s (DOE) amendment stemmed from the opinion released by the Department of Justice (DOJ) last September citing that constitutional foreign ownership restriction on the exploration, development and utilization of natural resources only covers things that are susceptible to appropriation and excludes the sun, wind and ocean.
However, the DOJ saidthe IRR of the RE Act of 2008 must be amended to conform to the opinion.
“With the impressive amount of interest, the DOE has been receiving both from the local and foreign investors in RE development, particularly in the offshore wind potential, the state can now directly undertake the exploration, development, production and utilization of RE resources or it can enter into RE service or operating contracts with Filipino and/or foreign citizen or Filipino and/or foreign-owned corporations or associations,” Lotilla said in a statement.
However, Lotilla stressed that the appropriation of waters direct from the source shall continue to be subject to the foreign ownership restriction under the Water Code.
“The country has a vast potential in RE development. Now that the foreign equity restrictions in the RE sector has been relaxed, we expect an increase of investments in the sector which would certainly contribute to our economy, provide jobs to our people, and help meet the goal of increasing the RE in the power generation mix of 35 percent by 2030 and 50 percent by 2040,”Lotillaadded.
Based on data from the DOE, as of September 2022, the country’s total installed RE capacity on technologies such as geothermal, hydro, biomass, solar and wind for both on-grid and off-grid is at 8,252 megawatts (MW), equivalent to 29.3 percent of the overall 28,203 MW worth of installed power capacity nationwide.
