A proposed Senate bill, called the Energy Virtual One Stop Shop of 2017 (Evoss Act), is expected to cut red tape, make power supply more stable and lower energy costs by simplifying the permitting process for new energy projects, the bill’s sponsor said.
The proposed Evoss Act “focuses on a problem that is painfully common in all fields of public governance – bureaucratic inefficiencies, redundancies, and overlaps, collectively known more commonly as ‘red tape’,” Senator Sherwin Gatchalian, who is the chairman of the Senate Committee on Energy, said in his sponsorship speech.
Gatchalian stressed that “the elimination of red tape in the permitting process will go a long way toward rejuvenating our energy sector. It will remove a formidable barrier to entry that has often discouraged foreign firms from entering the generation market.”
Competition in the industry would bring in a larger supply of power, and subsequently, make generation costs cheaper, he added.
“Based on my conversations with industry analysts and our own internal research, cutting down red tape could reduce consumer electricity prices by as much as P1 per kilowatt-hour,” Gatchalian said.
He explained that the ordinary household within the Greater Metro Manila Area consumes 200 kWh per month. Thus, shaving off P1 per kWh would translate into an annual savings of P2400 for that family.
“An extra P2400 can do a lot for a family. That’s enough to buy an entire 50 kilograms sack of rice with some extra cash to spend on tuition and supplies for the children, healthcare, and other essentials,” he added.
Overall, the lawmaker estimates that Philippine households, numbering approximately 23 million, will stand to save a total of P55.2 billion pesos per year as a result of the Evoss reform.
As an example of the unwieldy permitting set-up at present, Gatchalian pointed to the example of the permitting process for run-of-river hydro plants, a 1340-day ordeal which requires developers to secure 359 signatures from 74 regulatory agencies and attached bureaus, and accomplish 43 different contracts, certifications, endorsements, and licenses as required by 20 different laws governing the entire permitting process.
Under the Evoss Act, government agencies, instrumentalities, and other public bodies involved in the permitting process of power generation projects will be mandated to follow clear processes within a strict timeframe using published standards, thereby cutting the permitting process in half.
It likewise mandates the establishment of an online system that allows the single submission and synchronous processing of documentary requirements, assessment and payment of taxes and fees, status updates and progress monitoring, and a synchronized permitting approval process. It will also provide a single decision-making portal for the evaluation of new power generation projects.
The new system would eliminate repetitive form submission, the physical transport of documents from one agency to another, and existing constraints that prevent multiple agencies from simultaneously processing applications.
The Evoss will be under the control and supervision of the Department of Energy (DoE), while its operations will be determined and monitored by the Evoss Inter-Agency Technical Working Group (Evoss IATWG), which will be chaired by the Office of the President.
“The energy sector is a field that is critical to the long-term growth prospects of our developing nation, but has long been ignored or neglected because of its complexity. It is time to set the energy sector free from the dense undergrowth of red tape surrounding it. It is way past time for hedge-clippers. It is high time we use the Evoss Act to set all of that red tape ablaze,” Gatchalian said.