DEPARTMENT CIRCULAR NO.

DC2019-_________

OMNIBUS GUIDELINES GOVERNING THE AWARD AND ADMINISTRATION OF

RENEWABLE ENERGY SERVICE AND OPERATING CONTRACTS AND THE
REGISTRATION OF RENEWABLE ENERGY DEVELOPERS

WHEREAS, pursuant to Section 2, Article XII, of the 1987 Philippine Constitution, all
forces of potential energy and other natural resources within the Philippine territory
belong to the State and their exploration, development and utilization shall be under
the full control of the State;

WHEREAS, Section 2 of Republic Act (R.A.) No. 7638, as amended, otherwise

known as the “Department of Energy Act of 1992,” mandates the Department of
Energy (DOE) to prepare, integrate, coordinate, supervise and control all plans,
programs, projects and activities of the Government relative to energy exploration,
development, utilization, distribution and conservation, among others;

WHEREAS, Section 2 of R.A. No. 9513, otherwise known as the “Renewable Energy
Act of 2008” (RE Act), provides the policy of the State to encourage and accelerate
the exploration, development and utilization of renewable energy (RE) resources
such as, but not limited to, biomass, solar, wind, hydropower, geothermal, and ocean
energy sources, and including hybrid systems;

WHEREAS, Department Circular No. 2009-05-0008 prescribes the Implementing

Rules and Regulations (IRR) of the RE Act and reiterates the mandates of the DOE
to issue a regulatory framework containing the guidelines that shall govern the
transparent and competitive system of awarding Renewable Energy
Service/Operating Contracts (RE Contracts) from pre-development to development
onto commercial operations stage, or the awarding of direct operating contracts to
specific RE technologies, among others;

WHEREAS, biofuels, which are defined as fuels made from biomass, are considered
as a RE resource under the scope of biomass energy, pursuant to Section 4(b) of
the RE Act;

WHEREAS, Joint Administrative Order (JAO) No. 2008-1, Series of 2008, otherwise
known as the “Guidelines Governing the Biofuel Feedstocks Production, and
Biofuels and Biofuel Blends Production, Distribution and Sale,” provides for the
accreditation of biofuel producers, among others, under R.A. No. 9367, otherwise
known as the “Biofuels Act of 2006;”

WHEREAS, in pursuing the efficient and transparent exploration, development and

utilization of RE resources, the DOE promulgated various policies and guidelines in
the awarding of RE Contracts and issuance of Certificates of Registration to RE

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Developers, with the view to increase the development and utilization of RE to
contribute in the attainment of energy supply security in the country, to wit:

(a) DC2009-07-0011 dated 12 Jul 2009

(b) DO2013-08-0011 dated 20 July 2013
(c) DO2013-10-0018 dated 09 October 2013
(d) DO2013-12-0020 dated 02 December 2013
(e) DO2013-12-0023 dated 27 December 2013
(f) DO2014-06-0010 dated 09 June 2014
(g) DO2014-10-0018 dated 14 October 2014
(h) DO2016-09-0011 dated 05 September 2016
(i) DO2016-06-0010 dated 24 June 2016
(j) DO2017-04-0005 dated 07 April 2017
(k) DO2018-03-0003 dated 16 March 2018
(l) DO2019-01-0003 dated 11 January 2019

WHEREAS, recent developments necessitate the harmonization and enhancement

of the existing guidelines and procedures governing the transparent and competitive
system of awarding RE Contracts and the registration of RE projects;

NOW, THEREFORE, in consideration of the foregoing premises, the DOE hereby

issues the following revised guidelines and procedures governing the awarding of
RE Contracts, and the registration and management of RE Projects:

CHAPTER I

GENERAL PROVISIONS

Section 1. Title. This Circular shall be known as the “OMNIBUS GUIDELINES

GOVERNING THE AWARD AND ADMINISTRATION OF RENEWABLE ENERGY
SERVICE AND OPERATING CONTRACTS AND THE REGISTRATION OF
RENEWABLE ENERGY DEVELOPERS.”

Section 2. Coverage. This Circular shall prescribe the guidelines and procedures
on:

2.1. The pre-application, application and award of RE Contracts;

2.2. The transition of the existing Service Contracts to RE Contracts on the

exploration, development or utilization of RE resources with the DOE, subject to
Section 39, Rule 13, of the IRR of the RE Act;

2.3. The issuance by the DOE of Certificates of Registration (COR) for RE

Developers of projects with or without RE Contracts; and

2.4. The administration of RE Contracts.

Section 3. Definition of Terms. As used in this Circular, the following terms shall
be understood to mean, as follows:

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3.1. “Blocking System” shall refer to the subdivision of the Philippine territory into RE
meridional blocks (RE blocks) of 30 seconds of latitude and 30 seconds of
longitude using Philippine Reference System of 1992 (PRS’92) as the standard
reference system. One (1) RE block shall have approximate area of eighty-one
(81) hectares. Each block shall have a unique number designated by the DOE
which shall be used exclusively in identifying the coverage of a contract area.

3.2. “Certificate of Confirmation of Commerciality” or “COCOC” shall refer to the

Certificate duly signed by the DOE Secretary confirming the Declaration of
Commerciality by the RE Developer and shall serve as a Notice to Proceed for
the construction of the RE project or the installation of the RE facilities. The
date of issuance of the COCOC shall be considered to be the start of the
Development Stage of the RE project;

3.3. “Commercial Operations” shall refer to the phase of the RE development when
the RE Developer has completed the testing and commissioning of its power
plant and is ready to inject power into the grid, or to sell or supply its produced
energy, as duly confirmed by the DOE and other relevant regulatory bodies;

3.4. “Contract Area” shall refer to the total area, which is the subject of the RE
Contract as detailed and outlined in the map with its technical description, and
where the RE Developer has the exclusive right to explore, develop and utilize
the RE resources;

3.5. “Declaration of Commerciality” or “DOC” shall refer to a written declaration by

the RE Developer stating that the project is commercially feasible and
sustainable;

3.6. “Direct Application” shall refer to the submission of the RE Application and the
acceptance thereof by the DOE, where the RE Applicant identifies the proposed
RE area and verified by the DOE that such area is free and open for RE
development;

3.7. “Financial Closing” shall refer to the stage when the RE Developer has secured
its full financing requirement to implement its RE project, either through equity
or commercial borrowings, or other financing schemes, intended to pursue the
implementation and the completion of the RE project;

3.8. “Financial Qualifications” shall refer to the criteria and procedures set out by the
DOE, to establish the financial capability of the RE Developer to implement the
RE project;

3.9. “Person” shall refer to a natural or juridical person, as the case may be;

3.10. “Production Area” shall refer to that portion of the Contract Area identified by
the RE Developer, where the RE resources shall be utilized to produce
electricity in commercial quantities;

3.11. “RE Applicant” shall refer to any Person, whether natural or juridical, including

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 joint venture or consortium of local, foreign, or local and foreign-owned firms,
subject to the limitations provided in Section 4.2 hereof, who applies for the
assessment, exploration, extraction, harnessing, development, utilization or
commercialization of the RE resources;

3.12. “RE Application” shall refer to the submission by the RE Applicant of pertinent
documents pertaining to the legal, technical and financial qualifications to
enter into an RE Contract, in accordance with the requirements under this
Circular;

3.13. “RE Developer” shall refer to an individual or juridical entity created, registered
and/or authorized to operate in the Philippines in accordance with existing
Philippine laws, and engaged in the exploration, development or utilization of
RE resources and actual operation of RE systems or facilities. It shall include
existing entities engaged in the exploration, development and/or utilization of
RE resources, or the generation of electricity from RE resources, or both;

3.14. “RE Operating Contract” shall refer to the service agreement between the DOE
and the RE Developer for the development and utilization of RE resources
where, due to their inherent technical characteristics, need not go through
Pre-Development Stage of a RE project;

3.15. “RE Resource” shall refer to energy resources that do not have an upper limit
on the total quantity to be used. Such resources are renewable on a regular
basis, and whose renewal rate is relatively rapid to consider availability over
an indefinite period of time. These include, among others, biomass, solar,
wind, geothermal, ocean energy, and hydropower, conforming with
internationally accepted norms and standards on dams, and other emerging
renewable energy technologies;

3.16. “Renewable Energy Management Bureau” or “REMB” refers to the unit of the
DOE with the primary function of, among others, implementing policies, plans,
and programs related to the accelerated development, transformation,
utilization, and commercialization of renewable energy resources and
technologies; and

3.17. “Work Program” refers to the plans and programs and other related activities
formulated for the performance of the work obligations by the RE Developer,
along with the corresponding budgetary estimate, submitted to the DOE for
approval.

CHAPTER II

RE SERVICE AND OPERATING CONTRACTS

Section 4. RE Contract. A RE Contract is a service agreement between the

Government, through the President or the DOE Secretary, and a RE Developer,
covering an appropriate period as stated therein, in which the RE Developer shall
have the exclusive right to explore, develop or utilize a particular RE area.

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4.1. Modes of Awarding RE Contract. RE Contracts shall be awarded through (a) an
open and competitive selection, (b) nomination or (c) direct application.

4.2. Who May Apply. Any Person, local or foreign, may apply for RE Contracts,
subject to the limits provided in this Circular.

The RE Applicant must be a Filipino or, if a corporation, must be a Filipino

corporation with at least sixty percent (60%) of its capitalization duly owned and
controlled by Filipinos and is duly registered with the Securities and Exchange
Commission (SEC), except when applying for biomass development and/or using
waste to energy technology.

For the large-scale exploration, development and utilization of geothermal resources,

the Government through the President may enter into agreements with foreign-
owned corporations involving technical or financial assistance.

In case the RE Applicant is a joint venture or a consortium, the partners of the joint
venture or members of the consortium shall organize themselves as a corporation
registered under the Corporation Code of the Philippines and shall comply with the
nationality requirements as provided for in the preceding paragraph.

4.3. Kinds of RE Contracts. A RE Contract that contains a Pre-Development Stage is

considered a RE Service Contract, otherwise, it shall be considered a RE Operating
Contract.

The development or utilization of solar or biomass resources, due to their inherent

technical characteristics, shall be covered by a RE Operating Contract only.

4.4. Stages of RE Contract. The RE Contract shall cover two (2) stages of the RE
project development, namely:

4.3.1. Pre-Development Stage, which involves the preliminary assessment and

feasibility study up to Financial Closing and Declaration of Commerciality
(DOC) of the RE project including the identification of the proposed
Production Area; and

4.3.2. Development/Commercial Stage, which involves the development,

production or utilization of RE resources, including the construction and
installation of relevant facilities up to the operation phase of the RE
facilities.

4.5. Conversion from Pre-Development Stage to Development/Commercial Stage.

Upon the DOC by a RE Developer and after the confirmation by the DOE, the RE
Contract shall be converted from Pre-Development Stage to
Development/Commercial Stage.

The DOC with documentary requirements specified in Annex A of this Circular shall
be submitted to the DOE prior to the expiration of the Pre-Development stage.

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Failure by the RE Developer to submit its DOC within the Pre-Development stage
shall be a cause for the termination of its RE Contract. The acknowledgment of
receipt of the DOC by the DOE shall toll the running of the Pre-Development period.

Once the RE Developer has satisfactorily complied with all the requirements, the
DOE shall issue a letter indicating the remaining contract term with the Certificate of
Confirmation of Commerciality (COCOC) which shall likewise be considered the
conversion of the RE Contract from Pre-Development Stage to
Development/Commercial Stage.

If the results of the evaluation of the DOC are unsatisfactory, the RE Developer,
upon receipt of notice, shall have the remainder of the Pre-Development period
within which to correct such deficiencies.

The failure of the RE Developer to secure a COCOC before the expiration of its Pre-
Development period shall be a cause for the termination of its RE Contract.

Section 5. Conversion from Existing Service Contract on RE Resources Prior

to the RE Act. For existing RE projects that are operating prior to the effectivity of
the RE Act, the contract holder may elect to convert its Service Contract or
Agreement by applying for a RE Contract under this Circular. Consequently, the
period of the RE Contract to be issued in relation thereto, shall be the balance of the
contract term of the previous Service Contract or Agreement.

Section 6. RE Contract Area. Upon conversion from the Pre-Development to

Development Stage of the RE Service Contract, the Contract Area shall be revised
to cover the Production Area only. In the case of the RE Operating Contract, the
Contract Area is equivalent to the Production Area.

CHAPTER III

TYPES OF RE CONTRACT PER RESOURCE

Section 7. Biomass Energy Resource. The development of biomass shall be

covered by a Biomass Renewable Energy Operating Contract (BREOC). The RE
Developer shall be given a period of three (3) years from the award of BREOC to
commission the biomass power plant. The BREOC following the prescribed template
(Annex B) shall be valid for 25 years and may be renewed for the same period,
subject to terms and conditions provided therein.

Section 8. Geothermal Energy Resource. Geothermal development shall be

covered by Geothermal Service Contract (GSC) in accordance with the prescribed
template (Annex C). The GSC shall start with the Pre-Development Stage where the
RE Developer is given five (5) years to determine existence of Geothermal
Resources in Commercial Quantities. If on the fifth year of the Work Program the RE
Developer has discovered a resource, it shall be allowed to apply for an extension of
the Pre-Development Stage for a period of two (2) years to determine viability of the
resource: Provided, That it is not in default of its contractual obligations and it has
submitted an acceptable Work Program covering the extended period. Upon
Declaration of Commerciality, the GSC shall be converted from Pre-Development to

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Development Stage and shall remain valid for 25 years less the period spent in Pre-
Development Stage and the RE Developer shall commence with the construction of
the power plant in accordance with the timeline set in the approved five-year Work
Program. The GSC may be renewed for another 25 years, subject to terms and
conditions provided therein.

Section 9. Solar Energy Resource. The development of solar shall be covered by

Solar Energy Operating Contract (SEOC) following the prescribed template (Annex
D). The Work Program depends on the type of development whether it is mounted,
roof-top or floating. The RE Developer shall be given a period of two (2) years from
the award of SEOC to commission the project. However, for projects that require re-
classification of land, such period shall commence from the date of reclassification.
The SEOC shall be valid for 25 years and renewable for the same period subject to
terms and conditions provided therein.

Section 10. Hydropower Resource. The development of hydropower resource

shall be covered by Hydropower Service Contract (HSC) following the prescribe
template (Annex E). The Pre-Development Stage shall be for a period of three (3)
years for run-of-river and five (5) years for hydropower with capacity of 50 MW and
above. Upon Declaration of Commerciality, the HSC shall be valid for 25 years less
the period spent for Pre-Development stage and may be extended for the same
period subject to terms and conditions provided therein.

Section 11. Ocean Energy Resource. The development of ocean energy resource
shall be covered by Ocean Service Contract (OSC) following the prescribe template
(Annex F). The Pre-Development Stage shall be for a period of three (3) years to
determine the viability of the resource. Upon Declaration of Commerciality, the OSC
shall be valid for 25 years less the period spent for Pre-Development stage and may
be extended for the same period subject to terms and conditions provided therein.

Section 12. Wind Energy Resource. The development of wind energy resource
shall be covered by Wind Energy Service Contract (WESC) following the prescribe
template (Annex G). The Pre-Development Stage shall be for a period of three (3)
years to determine the viability of the resource. Upon Declaration of Commerciality,
the WESC shall be valid for 25 years less the period spent for Pre-Development
stage and may be extended for the same period subject to terms and conditions
provided therein.

CHAPTER IV

PROCEDURE IN AWARDING RE CONTRACTS UNDER OPEN AND

COMPETITIVE SELECTION PROCESS

Section 13. Open and Competitive Selection Process (OCSP). Interested parties
may apply for RE Contracts on Pre-Determined Areas (PDAs) offered by the DOE
during a prescribed period (Annex H).

13.1. Selection of PDAs. The REMB shall identify and submit a list of PDAs for RE
projects, with the respective Location Maps and Technical Descriptions
thereof, to the Secretary through its Supervising Assistant Secretary for

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 approval. PDAs shall refer to areas with renewable energy potential through
sufficient available technical data as may be determined by the REMB and
approved by the Secretary.

13.2. Launch and Publication. PDAs approved by the Secretary shall be scheduled
for launch and shall be publicly announced by the DOE for applications. PDAs
for offer shall be published for at least two (2) consecutive weeks in at least
two (2) broadsheet newspapers of general circulation and shall likewise be
posted at the DOE website.

13.3. Data Packages and Promotional Activities. The REMB shall arrange for the
availability of data packages for the approved PDAs that can be purchased by
interested parties in support to their applications. The REMB shall conduct
promotional activities to promote the OCSP and the corresponding data
packages so as to ensure maximum participation and awareness of
prospective investors and stakeholders.

13.4. PDA Application. Applications may be submitted a day after the publication
date until the last day of submission which shall be sixty (60) calendar days
from the date of publication in accordance with the following procedures:

13.4.1. The Applicant shall submit a Letter of Intent (LOI) following the
prescribed format (Annex I) and four (4) complete sets of legal,
technical, and financial documents in accordance with prescribed
Checklist of Requirements (Annex J);

Each application shall cover only one predefined area of interest as

published.

13.4.2. Submitted RE Application must be in both paper and digital (USB

Drive in Microsoft Word or *.pdf format) copies. Times New Roman 12
font and single line spacing are recommended. Figures shall be
submitted in an appropriate format, no smaller than A3 size. For
legibility, figures and maps shall be submitted at a larger scale
(1:10,000) as appendices;

13.4.3. An application fee shall be paid by each area applicant, along with the
submission of complete application documents. All payments may be
made in cash, manager/company cheque, payable to "Department of
Energy' or wire/bank transfer. All wire/bank transfer should be net of all
applicable bank and financial charges.

13.5. Opening and Evaluation of Applications. The DOE shall open the applications
at exactly 1330H on the last day of submission of applications.

13.6. Evaluation, Selection and Award. The evaluation and selection of RE

application and award of RE Contract shall be conducted following the criteria
and procedures set hereunder:

13.6.1. Applications with incomplete documents based on the Checklist of

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 Requirements shall be automatically disqualified during the opening of
the applications. No additional documents shall be accepted after the
deadline for submission of applications.

Applicants will be duly informed by the REMB Supervising Assistant Secretary

whether its application passed the completeness check and shall be subjected
to further legal, technical and financial evaluations. Disqualified applicants with
incomplete documents shall also be duly informed by the REMB Supervising
Assistant Secretary its lacking documents.

13.6.2. After the opening of application documents, the DOE shall immediately
conduct evaluation of the submitted applications for all PDAs based on
the following criteria:

1. Legal qualification Pass or Fail

2. Work Program 40%
3. Technical qualification 20%
4. Financial qualification 40%

13.6.3. The highest ranked applicant who meets the legal, technical and
financial requirements shall be selected.

13.6.4. After complete review and evaluation of the legal, technical, and
financial qualifications of the applicant/s, the REMB Assistant Director
through the Supervising Assistant Secretary, shall transmit to the
Secretary a written endorsement of the winning applicant.

13.6.5. Based on the written endorsement of the REMB, the Secretary may
approve the application for RE Contract.

13.7. An OCSP is declared failure when any of the following circumstances exist:

13.7.1. No RE Proposal was received by the DOE;

13.7.2. No one among the applicants was able to meet the legal
requirements, as determined by the DOE; or

13.7.3. When one or more applicants have met the legal requirements but
after the evaluation of technical and financial proposals, no applicant
was able to meet either the technical or financial requirements, as
certified by the DOE.

In any of the foregoing cases, the area may be applied for RE Contract under Direct
Application. To initiate the change of mode of awarding RE Contract from OCSP to
Direct Application, the DOE shall include in the announcement of the result of the
OCSP the area/s which shall be open for Direct Application indicating when the
process shall commence.

CHAPTER V

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 PROCEDURE FOR AWARDING OF RE CONTRACTS UNDER NOMINATION

Section 14. Coverage. The procedure for awarding RE Contracts under the
Nomination Process shall cover geothermal, hydropower, and wind power with
capacity of greater than 5MW for on-grid areas and greater than 3MW for off-grid
areas.

Section 15. Nomination. The Nomination Process shall be comprised of the

following:

15.1. Nomination and Publication.

15.1.1. Applicants shall nominate the proposed project area to the DOE-
Information Technology and Management Services (ITMS) by
specifying the location thereof in its LOI and specifying the location
based on the mapping requirements (Annex K);

15.1.2. The LOI shall be addressed to the ITMS Director copy furnished the
REMB Assistant Director, and submitted through the Records
Management Division (RMD).

15.1.3. Upon receipt of the LOI, the RMD shall attach a Radio-frequency
Identification (RFID) tag thereon, encode the document under Energy
Application Monitoring System (EAMS) and forward the document to
the ITMS Director and the REMB Assistant Director.

15.1.4. Within one (1) calendar day from receipt of the LOI, the ITMS shall
issue the order of payment to the applicant for the processing fee on
Area Verification which shall be paid within the same day.

15.1.5. The ITMS shall, within five (5) working days from receipt of the LOI and
a copy of the Official Receipt of the payment of processing fee,
complete the area verification, attach in EAMS the memorandum on
the result of the area verification and endorse the nomination with its
evaluation to the REMB Assistant Director. Thereafter, the REMB
Assistant Director shall, within two (2) working days, endorse the
nomination to the REMB Supervising Assistant Secretary, who shall
inform the nominating applicant in writing, of the approval/rejection of
such nomination within three (3) working days from receipt thereof and
attach the letter in the EAMS.

15.1.6. Within fifteen (15) calendar days from its receipt of the notice of
approval from the DOE, the nominating applicant shall, at its own
expense, cause the publication of its nomination of the area/s of
interest once a week for at least three (3) consecutive weeks in two (2)
newspapers of general circulation. Such publication shall likewise
contain an invitation to all interested parties to challenge the
nomination. Failure of the nominating applicant to comply with the
aforementioned requirements shall be a cause for the nullification of its

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 nomination, without need of notice, which shall open such area for new
nominations. The template layout of the items for publication are more
particularly described in Annex L hereof.

The nominating applicant shall submit to the REMB Assistant Director through RMD,
proof of publication, including copies of the official receipt evidencing payment
thereof within seven (7) days from the date of publication.

Within one (1) working day from the receipt of the documents, the RMD shall attach
a RFID tag thereon, encode the document under EAMS and forward the documents
to the REMB Assistant Director.

The REMB Assistant Director shall likewise cause the posting of the existence of a
nomination of area/s of interest with an invitation for challenge on the DOE website
as soon as practicable and attach the memorandum for and date of posting in the
EAMS.

15.2. Submission of RE Contract Applications.

15.2.1. Upon the lapse of the period for publication, the subject area/s of
interest shall be declared open for RE Contract applications by the
REMB Supervising Assistant Secretary following the timeline as
provided in the publication template.

15.2.2. The nominating applicant and challengers, if any, shall submit four (4)
hard copies and one (1) soft copy of legal, technical, and financial
documents for evaluation. The complete list of legal, technical, and
financial documents, and the formatting of the digital submissions, are
more particularly described in Annex J hereof.

Each application shall cover only the area/s of interest as duly nominated and
published.

15.3. Evaluation, Selection, and Award.

15.3.1. After receiving the application documents through the RMD, the REMB
Assistant Director shall endorse the RE Application to the concerned
REMB division. The concerned REMB division shall within one (1)
working day from receipt thereof from the RMD, furnish copies thereof
to the Legal Services (LS) and Financial Services (FS) for legal and
financial evaluation, respectively.

15.3.2. The concerned DOE units shall evaluate the applications within five (5)
working days based on the following criteria:

Legal qualification Pass/Fail

Work Program 30%
Technical qualification 40%
Financial qualification 30%

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 15.3.3. The applicant who garners the highest score and meets the legal,
technical and financial requirements shall be selected.

In case the nominating applicant loses to a challenger, the winning applicant

shall reimburse the nominating applicant the costs it incurred in connection
with the application for nomination and the publication thereof. Such
reimbursement shall be effected within seven (7) calendar days from receipt
of notice of award of RE Contract and shall be in the form of either cash or
manager’s/cashier’s check made payable to the nominating applicant. Failure
of the winning applicant to reimburse said costs within the said period shall
automatically nullify the award of RE Contract and the second highest-ranked
applicant shall be issued the notice of award of RE Contract and shall be
subject to the same conditions.

If the losing nominating applicant refuses to accept the payment of

reimbursement for costs it incurred, the winning applicant shall open an
escrow account in a government banking institution in favor of the losing
nominating applicant. The winning applicant shall, as soon as possible, submit
proof of the creation of the escrow account or payment of reimbursement of
costs incurred to the REMB Assistant Director.

15.3.4. An applicant who submitted incomplete or defective documents shall

only be allowed to complete or correct the same if no other application
was received during the application period.

The period within which a sole applicant shall be allowed to submit the lacking
or rectify the defective documents shall not exceed thirty (30) calendar days
from the opening of the application.

Failure of the sole applicant to submit or correct lacking or defective

documents within the prescribed period shall result in the automatic
disqualification of the application.

In the case of multiple applicants over the same area/s of interest, any lacking
or defective documents submitted by such applicants shall result to the
automatic disqualification of their applications.

15.3.5. After complete review and evaluation of the legal, technical, and
financial qualifications of the applicant/s and the production of the RE
Contract, the REMB Assistant Director shall transmit to the Secretary,
through the REMB Supervising Assistant Secretary, a written
endorsement of the winning applicant.

15.3.6. Within seven (7) calendar days from receipt of notice of award, the
winning applicant shall pay the RE Contract application and processing
fee based on the DOE's schedule of fees and charges.

15.3.7. The REMB Assistant Director shall prepare the final RE Contract using
the template provided herein. No deviation from the template shall be
allowed.

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 15.3.8. Based on the written endorsement of the REMB Supervising Assistant
Secretary, the Secretary may approve the application for RE Contract.

CHAPTER VI

PROCEDURE FOR AWARDING RE CONTRACTS

UNDER DIRECT APPLICATION

Section 16. Coverage. Direct Application shall govern the RE Contract Applications
for biomass and solar, regardless of capacity, and other RE resources with capacity
of not more than 5MW for grid area and 3MW for off-grid.

Part 1. Pre-Application of Interested Participant

Section 17. Submission of LOI. All interested participants shall prepare a LOI
indicating the proposed area in accordance with the mapping requirements
addressed to the REMB Director, and submitted through the RMD. Mere submission
of a LOI shall not be considered as a filing of a RE Application.

Upon receipt of the LOI, the RMD shall attach a RFID tag thereon, encode the
document under EAMS and forward the document to the REMB Assistant Director.

Section 18. Orientation of the Interested Participant. The orientation is intended

to inform and guide the applicant on the requirements and processes in the
evaluation and awarding of the RE Contract and the registration of a RE project.

18.1. Within three (3) working days from receipt of the LOI, the REMB Assistant
Director shall issue an acknowledgment letter addressed to the applicant and
attach the document in EAMS.

18.2. The interested participant shall be informed of the schedule of an orientation or

briefing on the RE Application requirements and processes.

Section 19. Area Verification. The concerned technical division of REMB through
its Director shall endorse the LOI and its attachments to the ITMS within two (2) days
from receipt of the documents on the proposed project area. For solar and biomass
development, the concerned REMB division shall also endorse the proof of
ownership or possessory rights over real property covered by the proposed project
area located in private lands to the LS.

19.1. Within one (1) calendar day from receipt of the LOI, the ITMS shall issue
the order of payment to the applicant for the processing fee on Area
Verification which shall be paid within the same day.

19.2. Within five (5) working days from receipt of the LOI and a copy of the Official
Receipt of the payment of processing fee, the ITMS and the LS shall complete
the area verification, attach in EAMS the memorandum on the result of the area
verification and provide the concerned REMB division of the verification report.

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 Part 2. Filing and Evaluation of RE Application

Section 20. Receipt of RE Application. The Interested Participant that complies

with the procedures and requirements provided herein may submit its RE Application
as follows:

20.1. Four (4) hard copies and one (1) soft copy of the RE Application shall be
submitted. Each hard copy shall have separate folders for legal, technical and
financial documents, all of which shall be original documents or certified true
copies thereof.

20.2. The concerned REMB division shall ascertain, on a pass or fail basis, whether
the RE Application is complete based on the Checklist of Requirements, and
thereafter issue an Order of Payment for the application and processing fees.
No Order of Payment shall be issued unless all the documentary requirements
in the RE Application are complied with.

20.3. Prior to submission of documents to the RMD, the applicant shall proceed to
the concerned REMB division for the checking of the requirements. However, if
the proposed area is found to be partially occupied by other RE developer, the
concern RE developer has the option to proceed with their application on the
remaining revalidated area which shall be the basis of the amount of their
application and processing fees.

20.4. After payment of the application and processing fees, the Interested Participant
shall submit all five (5) copies of the RE Application, together with the
photocopy of the official receipt of the said fees, to the RMD.

At this stage, the RE Application is deemed filed and submitted and any amendment
thereof by the RE Applicant shall not be allowed.

The ITMS shall make the area available to other applicants only when the RE
Applicant failed to qualify, or withdrew, or abandoned his application and after due
notice to the RE Applicant on such information by the REMB Assistant Director copy
furnished the ITMS.

Section 21. Evaluation Process. The Records Management Division shall, within
one (1) working day from receipt of RE Application, forward the same to concerned
REMB division.

The concerned REMB division shall record the date of filing of the RE Application
and within the same day of receipt from the Records Management Division,
distribute one (1) copy of the RE Application each to the Legal Services for legal
evaluation and Financial Services for financial evaluation.

Thereafter, the concerned divisions of REMB, Legal Service and Financial Services
shall evaluate the RE Application at the same time which should be completed within
five (5) working days from date of receipt of the RE Application.

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21.1. If the RE Application passed the legal, technical and financial evaluations, the
evaluation documents shall be collated, facilitated, reviewed and endorsed by
the Assistant Director of REMB to the REMB supervising Assistant Secretary
with the assistance of the concerned REMB division who shall prepare, within
three (3) working days from receipt thereof, an endorsement memo, the
template contract and the corresponding COR.

21.2. In case the RE Application is not qualified either legally, technically or

financially, the concerned REMB division under the supervision of the REMB
Assistant Director shall, within three (3) working days from receipt of all the
evaluations, prepare a letter to be signed by REMB Director requiring the RE
Applicant to submit supporting documents to clarify pertinent information in its
submission within a period of five (5) working days from receipt of such notice.

21.3. Failure of the RE Applicant to submit supplementary documents within the

prescribed period shall mean abandonment of the RE Application. Thereafter,
a notice to the RE Applicant shall be prepared by the REMB for approval by
its Assistant Secretary that the RE Application is deemed abandoned.

21.4. In case the RE Applicant submits supplementary documents within the

prescribed period under sub-paragraph 21.2 hereof, the concerned divisions
shall re-evaluate the RE Application and submit the result within two (2)
working days from receipt thereof. The REMB Assistant Director shall collate
the results and follow the procedure in item 21.1 if the RE Application have
passed the legal, technical and financial requirements.

21.5. In case the RE Application failed to pass either the legal, technical or financial
requirements, the REMB Assistant Director shall recommend such
disqualification to its supervising Assistant Secretary who shall issue a formal
notice to the RE Applicant stating the basis of disqualification and a
memorandum to ITMS to immediately re-open the area for RE Application by
posting such information in the DOE website.

Part 3. Award of RE Contracts

Section 22. Approval and Signing of the RE Contract. The following shall
govern the awarding of the RE Contract and the registration of the RE Developer on
a specific project:

22.1. The DOE shall notify the winning or qualified RE Applicant of the award and
the schedule of signing of the RE Contract: Provided, That the RE Contract in
the nature of a financial or technical assistance agreement shall be approved
and executed by the President of the Philippines, upon the recommendation
by the DOE Secretary.

22.2. The concerned REMB division under the supervision of its Assistant Director
shall prepare the memorandum to the Secretary endorsing the award of the
RE Contract through its Assistant Secretary. Endorsement must include
complete attachments on the original copy of the results of legal, technical
and financial evaluations, project area map and its technical descriptions.
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 REMB Assistant Director shall release these documents within three (3)
working days from receipt of complete evaluation results.

22.3. Within two (2) working days from approval of the Secretary of the
recommendation, the REMB Director shall inform the RE Applicant to pre-sign
original copies of the RE Contract following the prescribed template.

22.4. Within one (1) working day from the date of pre-signing, REMB Assistant
Director thought the Supervising Assistant Secretary shall submit to the
Secretary the pre-signed RE Contract with the corresponding Certificate of
Registration (COR), and all the attachments. The Secretary shall act on it
within seven (7) working days from receipt.

22.5. The REMB Assistant Director shall send a written notice to the RE Applicant
with an Order of Payment within one (1) working day from the signing of the
RE Contract to pay the signing fee and post the performance bond covering
the first Contract Year.

22.6. The notarized copy of the RE Contract and the COR shall be furnished to the
RE Applicant upon submission by the latter of a copy of the official receipt of
the DOE of payment of the corresponding signing fee which shall be paid
directly to the treasury and the performance bond. A copy of the original RE
Contract and a photocopy of the COR shall be provided each the concerned
REMB division and the Records Management Division.

22.7. The concerned REMB division shall create a record of the signed RE
Service/Operating Contract in the Energy Virtual One Shared System
(EVOSS) and attach a copy of the signed RE Service/Operating Contract and
its annexes, COR and performance bond.

22.8. Failure of the RE Developer to submit proof of payment of the signing fee
within fifteen (15) working days from receipt of notice shall be deemed as an
abandonment of the RE Application and shall cause the revocation of the
COR and the RE Contract. Further, non-posting of the performance bond
within thirty (30) working days from execution thereof shall cause the RE
Contract to be deemed ineffective.

The evaluation of the RE Application and award of RE Contract shall be conducted

following the Flow Diagram (Annex M).

CHAPTER VII

TECHNICAL GUIDELINES

Section 23. Configuration of RE Contract Area. The configuration of the proposed

RE Contract area shall depend on the type of resource being applied for as follows:

23.1. For solar and biomass resources, the area shall be in one (1) parcel polygon.

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 The interested participant shall specify the type of system of the project,
whether it is ground-mounted, roof-mounted or floating solar and submit the
technical requirements based on the chosen system.

23.2. For hydropower resources, the applied area shall indicate the geographic
coordinates of the proposed location of weir, with elevation, and the
powerhouse.

23.3. For wind, geothermal and ocean resources, the applied area shall either be
polygonal or in blocks following the Blocking System or a combination of both.

Section 24. Area Verification Results. The ITMS shall provide the concerned
REMB division of the verification report which may indicate the following information:

24.1. The proposed or applied project area is covered by an existing RE Contract for
the development of the same RE technology/resource being applied for;

24.2. The proposed area is not open for RE Contract Application and/or if it is
covered by service contract of other energy/RE technologies, or if it is within a
protected area;

24.3. The proposed area is with a pending RE Application for the same RE
technology/resource;

24.4. The proposed area overlaps with an existing service/operating contract

covering energy resources/technologies other than the RE resource/technology
being applied for; and

24.5. The proposed area is open for RE Contract application.

Section 25. Multiple Resources in an Area. For item 23.4 above, the applicant
may pursue his RE Application by submitting a notarized acknowledgment and
undertaking on the following:

25.1. The recognition of the existence of the prior right of the existing contract holder;
and

25.2. The interested participant shall secure the clearance and/or no opposition from
the existing contract holder.

The concerned REMB division shall formally notify the Interested Participant within
two (2) working days from receipt of the result of the Area Verification evaluation
whether or not to proceed with the filing of RE Application and attach the letter in the
EAMS.

CHAPTER VIII

ADMINISTRATION OF RE CONTRACT

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Section 26. Posting of Performance Bond. The RE Developer shall post a bond or
any other guarantee of sufficient amount, but not less than the minimum
expenditures commitment for the first contract year, which shall be a condition
precedent to the effectivity of the RE Contract. A valid and subsisting Performance
Bond is required until completion of the construction of the RE project.

Section 27. Updating of RE Projects at the DOE Website. Posting and updating
of RE Contract awarded and pending Application in the DOE website.

27.1. The REMB-Technical Service Management Division (TSMD), in coordination

with the REMB technical divisions, shall quarterly collate and update the list of
RE Contract awarded and RE Applications.

All concerned DOE units shall provide updates to the EVOSS and DOE websites.

27.2. All RE Developers shall be required to register with the EVOSS for regular
updating of their respective projects.

Section 28. Amendment of RE Contracts. The evaluation of any proposed

amendment shall undergo the same process of RE Application and the REMB
Director, through the Supervising Undersecretary, shall recommend to the Secretary
the action to be taken.

28.1. For RE Contract Area amendments, the RE Developer shall submit a request
in writing addressed to the REMB Director, attention the concerned REMB
division, with the following requirements:

28.1.1. Technical description of proposed contract area indicating the

technical specifications and other Mapping Requirement for the
purpose of area verification.

28.1.2. The proposed amendment to the Contract Area shall be contiguous

with the existing Contract Area under the RE Contract and shall be
open for RE development as verified by the ITMS.

28.1.3. Reasons and justifications for the amendment of the Contract Area,
such as but not limited to: (a) the results of the resource assessment,
duly verified by the REMB concerned unit, (b) proof of land rights, and
(c) the RE Developer is not in default of its technical and financial
obligations under the RE Contract.

28.1.4. An acceptable Work Program with respect to the amended Contract

Area.

28.1.5. Holders of RE Contracts with provisions on Milestone Period shall be

allowed to apply for Contract Area amendment during the Milestone
Period provided that all approved Milestone activities under the RE
Contract have already been accomplished.

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 28.1.6. All other RE Contracts entered into by the DOE in compliance with
existing templates of RE Contracts at the time of signing shall only be
allowed to apply for Contract Area amendment not later than sixty (60)
days prior to the expiration of the Pre-Development Stage.

In case the DOC states that the viability of the project is subject to a Contract Area
amendment and upon due confirmation by the DOE, such amendment may be
allowed upon issuance of the COCOC.

28.2. The following templates for amendments of Contract Area under existing RE
Contracts are hereby adopted as follows:

28.2.1. RE Contracts issued in compliance to Department Order No. DO2013-

08-0011 entitled “Adopting Policies in Relation to the Processing of
Renewable Energy Service Contracts and Mandating the Adoption of
the Revised Templates for Renewable Energy Service Contracts”
dated 26 July 2013 shall adopt the template for amendments of
Contract Area attached hereto as Annex N; and

28.2.2. All other RE Contracts entered into by the DOE in compliance to the
existing templates of RE Contracts at the time of signing shall adopt
the prescribed RE Contract templates.

28.3. Issuance of amendment to RE Contract and revised COR shall be required in

the following instances:

28.3.1. Increase or decrease in the installed capacity of the project;

28.3.2. Change of type of feedstock for biomass operations;

28.3.3. Change of location of project site (for biomass and hydro sources only)

28.4. Only a revised COR shall be issued in the following changes:

28.4.1. Company name of the RE Developer; and/or

28.4.2. Assignment of RE Contract.

The amendment under Section 28.4 shall require surrender of the original
COR prior to evaluation of the request. Provided, That, in the case of purely
change of company name, the request shall be directly endorsed to the
Secretary after legal evaluation.

28.5. No amendment of RE Contract or COR is required in the contract conversion

from Pre-Development to Development Stage. However, relinquishment of a
portion of the Contract Area after identifying the Production Area as provided
herein shall result to the issuance of new Contract Area with corresponding
map and technical description.

28.6. Process for Evaluation of RE Contract Amendment. All request for RE Contract

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 amendment shall be submitted to REMB through RMD and shall be processed
in accordance with the following:

28.6.1. Upon receipt of the request, the RMD shall attach a RFID tag thereon,
encode the document under EAMS and forward the document to the
REMB Director.

28.6.2. Within one (1) working day from receipt of the request for RE Contract
Amendment, the REMB Director shall forward the documents to the
concerned REMB division for evaluation.

28.6.3. The concerned REMB division shall evaluate the request within five (5)
working days. In case the evaluation of the concerned REMB division
shows that there are additional costs to be incurred that should warrant
another financial evaluation or if there are any legal concerns on the
RE project or if there is a need of re-plotting of Contract Area, it shall
endorse it to FS, LS and/or ITMS which shall evaluate the request
within five (5) working days from receipt of such endorsement.

28.6.4. Within two (2) working days from completion of evaluation, the
concerned REMB Division, through the REMB Director, shall provide
the REMB Supervising Undersecretary the complete basis of the
recommendation.

28.6.5. The REMB Supervising Undersecretary shall, within three (3) working
days from receipt of such recommendation, issue a memorandum that shall
contain the highlights of the evaluation and a recommendation to the DOE
Secretary for approval.

28.7. The concerned REMB division shall immediately provide to the TSMD, ITMS,
and DOE-Investment Promotion Office (IPO) any RE Contract/COR status for
timely update of database.

Section 29. Termination of RE Contracts.

29.1. Based on its regular monitoring of the performance of the Developer of its
contractual obligations, REMB Director shall evaluate and recommend the
termination of RE Contracts.

29.2. Evaluation Process for RE Contract Termination. The concerned REMB

division shall recommend or endorse the termination the RE Contract within
the following timeline:

29.2.1. Five (5) working days from the lapse of the Pre-Development Stage of
the RE Contract where the Developer failed to submit DOC of the
project.

29.2.2. Five (5) working days from the voluntary relinquishment of the
Developer of the RE Contract.

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 29.2.3. During Pre-Commissioning phase of the RE Contract, upon findings
that the Developer failed to post the required performance bond.

29.2.4. At any stage of the RE Contract, upon findings of any of the grounds
for RE Contract termination as stipulated therein.

29.3. Within three (3) working days from receipt of the recommendation, the REMB
Director shall endorse it to the REMB Supervising Undersecretary the
complete basis of the recommendation.

29.4. The REMB Supervising Undersecretary shall, within three (3) working days,
issue a memorandum that shall contain the highlights of the evaluation and a
recommendation to the DOE Secretary for approval.

29.5. Thereafter, the concerned REMB division shall immediately provide to the
TSMD, ITMS and IPO any RE Contract status for timely update of database.

Section 30. Letter of Reconsideration. An RE Developer may submit a Letter of

Reconsideration addressed to the REMB Director within ten (10) days from their
receipt of a letter of termination. The REMB Director shall evaluate the merits of the
Letter of Reconsideration and endorse such recommendations to the Secretary
through the REMB Supervising Undersecretary following the process provided under
Section 29 hereof.

CHAPTER IX

RE PROJECTS FOR OWN-USE AND MICRO-SCALE RE PROJECTS

FOR NON-COMMERCIAL OPERATIONS

Section 31. RE Projects for Own-Use and for Non-Commercial Operations. RE

Developers generating power for own-use and for non-commercial operations shall
register with the DOE to avail of incentives under the RE Act. For this purpose, non-
commercial operations shall cover those projects which are intended for
demonstration of new or modified RE technologies and those fully covered by grants
and all other projects which are not designed for profit. The COR shall be issued
upon complete submission of requirements for evaluation by the REMB for approval
of the Secretary.

Section 32. Micro-Scale RE Projects. The issuance of COR for Micro-Scale RE

Project with installed capacity of not more than 100 kilowatts (100 kW), shall be
evaluated and endorsed by the REMB, for approval by the Secretary.

Section 33. RE Developer for Small-Scale, Mini-Grid or Hybrid Project. The

DOE shall issue a COR covering RE systems of small-scale having installed
capacity ranging from more than 100kW up to 1MW and RE components of not more
than 1MW in mini-grid or hybrid projects.

For clarity, the Electric Power Industry Management Bureau (EPIMB) shall have the
overall supervision in processing endorsements to the regulatory bodies for mini-grid

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and hybrid projects, and that REMB shall cover the RE component of such projects
such as technical and financial evaluation and COR processing.

Section 34. Requirements and Procedures for Registration. The DOE shall issue
a separate guidelines providing for the requirements and procedures for the
registration of the RE projects under this Chapter.

CHAPTER X

ISSUANCE OF CERTIFICATE OF REGISTRATION

Section 35. Registration of a RE Developer. The DOE shall issue the COR to the
RE Developer on a per project basis.

35.1. The holder of a RE Contract shall be issued a COR covering the project upon
the submission of the proof of posting of performance bond for the first
Contract Year.

35.2. Accredited biofuel producers under R.A. No. 9367, otherwise known as the
“Biofuels Act of 2006,” may apply for a COR as a biomass developer.

35.3. RE Developers of RE systems or facilities for own consumption and micro-

scale RE projects for non-commercial operations may apply for a COR.

35.4. RE Developers for small-scale RE systems and hybrid systems as defined

under Section 33 hereof, may register its project and shall be evaluated under
a simplified process and issued a specific COR for the purpose.

CHAPTER XI

TRANSITORY PROVISIONS

Section 36. Evaluation of Pending Applications. Evaluation of applications filed

prior to the effectivty of this Circular shall be evaluated based on the existing
guidelines at the time of the filing of the applications.

Section 37. . Re-filing of the Application for RE Contract and Certificate of

Registration. Pending applications for RE Contract or Certificate of Registration
may be re-applied within (30) working days from effectivity of this Circular without
need of payment of the application fee.

CHAPTER XII

FINAL PROVISIONS

Section 38. Separability Clause. If for any reason, any provision of this Circular is
declared unconstitutional or invalid, the other parts or provisions not affected thereby
shall remain in full force and effect.

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Section 39. Repealing Clause. The provisions of other department circulars which
are inconsistent with the provisions of this Circular are hereby repealed, amended or
modified accordingly.

Section 40. Effectivity. This Circular shall take into effect fifteen (15) days following
its publication in at least two (2) newspapers of general circulation.

ALFONSO G. CUSI
Secretary

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