Revised Policy Guidelines on the Implementation of Strategized Total Electrification Program (STEP)

July 15, 2022

NEA MEMORANDUM NO. 2022-35

 

This is to inform the Electric Cooperatives of the "Revised Policy Guidelines on the Implementation of Strategized Total Electrification Program (STEP)" which has been published with the University of the Philippines (UP) Law Center. (Please see attached)

The aforementioned memorandum shall take effect fifteen (15) days upon filing with the UP Law Center pursuant to the Presidential Memorandum Circular No. 11 dated 09 October 1992.

For inquiries, you may coordinate with the Total Electrification and Renewable Energy Development Department (TEREDD) through these e-mail address [email protected] (Luzon ECs), [email protected] (Visayas ECs), and [email protected] (Mindanao ECs), or through trunk line number at (02) 8929-1909 loc. 170 and 171.

For your information and guidance.

(SGD.) EMMANUEL P. JUANEZAAdministrator

ATTACHMENT

June 29, 2022

THE DIRECTOROffice of the National Administrative Register

Sir:

Greetings of peace and good health!

Pursuant to Book VII, Chapter 2, Section 3 of the 1987 Administrative Code of the Philippines, we are respectfully submitting to the U.P. Law Center, for filing, publication and recording the attached certified true copies of the REVISED POLICY GUIDELINES ON THE IMPLEMENTATION OF STRATEGIZED TOTAL ELECTRIFICATION PROGRAM (STEP) promulgated by the National Electrification Administration (NEA) in accordance with its authority under Section 5 of P.D. No. 269 as amended. CAIHTE

Thank you very much for the usual and kind assistance of the U.P. Law Center.

Very truly yours,

(SGD.) ATTY. GWEN P. ENCISO-KYAMKOActing Corporate Board Secretary V

Revised Policy Guidelines on the Implementation of Strategized Total Electrification Program (STEP)

I. RATIONALE

• Section 2 of RA 10531, or the NEA Reform Act of 2013, mandated NEA to promote the sustainable development in the rural areas through rural electrification, and to pursue the electrification program and bring electricity, through the Electric Cooperatives (ECs) as its implementing arm, to the countryside even in missionary or economically unviable areas.

• The Special Provisions on subsidy releases for electrification indicated in the General Appropriations Act (GAA) of the National Electrification Administration (NEA) on the selection criteria for the Electric Cooperative beneficiaries.

• The revision is in connection with the review and update of the issued policies, Memorandum No. 2011-024 issued on 26 December 2011, Memorandum No. 2019-001 issued on 9 January 2019 and Memorandum No. 2019-054 issued on 13 November 2019, relative to the Sitio Electrification Program (SEP) and on the cost of house wiring materials, as instructed and recommended by the NEA Board of Administrators.

II. BACKGROUND

President Rodrigo R. Duterte issued a directive through the DOE Secretary to formulate plans and programs to accelerate the electrification of unviable, unserved and underserved areas in the country towards achieving 100% household electrification. As a kick off activity and in compliance with the directive, the DOE with the Energy Sector Agencies conducted a coordination meeting to discuss the Total Electrification Framework.

Accordingly, the NEA then established and revised its current programs into a comprehensive "Strategized Total Electrification Program" (STEP). It integrates the various electrification strategies, namely:

1. Expanded Sitio Electrification Program (Expanded SEP), for On-Grid and Off-Grid areas;

2. Barangay Line Enhancement Program (BLEP); and

3. Expanded Household Electrification Program (Expanded HEP), for On-Grid and Off-Grid Areas.

III. OBJECTIVES

a. To accelerate the attainment of 100% household electrification.

b. To define implementation scheme and sources of funds.

c. To motivate ECs to include the achievement of Total Electrification mandate as their priority agenda.

IV. POLICY STATEMENT

It shall be the policy of NEA to prescribe the Guidelines on the Implementation of Strategized Total Electrification Program (STEP) covering the following projects/categories:

A. Distribution Line

1. Expanded Sitio Electrification Program (ESEP)

a. Mechanics/Criteria on the selection of beneficiaries under the Sitio Electrification Program (SEP)

 

Tier/	Energization Level	Poverty Incidence	Liquidation	Peace and Order	Electrification Masterplan
Tier 1	84% and Below	Level 1, Level 2,3(40-60%)	Liquidated	With Peace and Order problem	Included in the CEMP/TEMP
Tier 2	85%-94%	Levels 4	Liquidated	-	Included in the CEMP/TEMP
Tier 3	95% and Above	Levels 1-5	Liquidated	-	Included in the CEMP/TEMP

 

b. Prioritize sitios where the absolute number of indigents and the incidence of poverty are high as identified by the latest official poverty statistics of the PSA, as well as those with high probability of being energized.

c. Construction of distribution lines of un-energized sitios which have at least 10 potential household connections.

d. Household connection for a maximum of 60 consumers per sitio or the actual number whichever is lower.

e. Self-contained power systems, confined to small off-grid geographic areas, powering up distant clusters of houses or villages.

This is an expansion and an innovation of the Sitio Electrification Program (SEP) which has the intention to use Renewable Energy technologies or Hybrid Systems to energize isolated communities with clustered houses which electric cooperatives deem not feasible for grid connection within the next 5 years or so. The systems are typically designed to be grid connected ready, in anticipation of the coming of the grid.

A hybrid energy system, or hybrid power, usually consists of two or more renewable or conventional energy sources used together to provide increased system efficiency as well as greater balance in energy supply.

2. Barangay Line Enhancement Program (BLEP)

a. Enhancement of distribution lines to barangays previously powered by gen-sets, solar home systems and other renewable energy technologies

b. Improvement of tapping points

c. Underground Cable Systems

d. Submarine Cable Systems

e. NPC SPUG unserved/underserved areas

3. Expanded Household Electrification Program (EHEP)

a. Electricity service connection to all unserved households situated in areas where distribution lines are either physically or technically available for extension.

b. Solar Home Systems (SHS) that target dispersed households with no access to the grid.

This is an expansion and an innovation of the Household Electrification Program (HEP) which has the intention to use Renewable Energy technologies to energize isolated communities with dispersed households which electric cooperatives deem not feasible for grid connection within the next 5 years or so.

B. House Wiring

To further support connection of marginalized consumers, the EC is hereby authorized to include the cost of house wiring materials and labor in the submission of its funding request for target sitios from FY 2022 and onwards. The maximum amount of Php4,900.00 shall be allowed per household connection to cover the inside assemblies, outside assemblies and labor (detailed breakdown attached as "Annex A").

V. FUND SOURCES

A. Subsidy Appropriation from the National Government to NEA

B. Energy Regulation 1-94 (ER 1-94)

C. Local Government Unit (LGU)

D. RFSC Regular CAPEX

E. RFSC Additional/Indicative CAPEX (Authority to Secure Loan (ASL))

F. Saving from General Fund

G. EC partnership/Joint Venture with private sector

H. Private Sector (QTP/PPP)

I. Grants/Donations

The project implementation, monitoring, inspection, acceptance, close-out and liquidation of fund should follow the policies, guidelines, rules and regulations issued by the implementing agencies and partners and the provisions indicated in the Memorandum of Agreement (MOA) between parties, such as NEA, EC, DOE, LGU, Gencos, Business Partners and Donors/Grantee.

All projects irrespective of fund source should be included as applicable in the Comprehensive Electrification Masterplan (CEMP)/Total Electrification Masterplan, EC Workplan, CAPEX plan and Cash Operating Budget (COB). The EC may apply for rate adjustment with the Energy Regulation Commission (ERC) to recover its investment, where applicable.

VI. IMPLEMENTATION SCHEME FOR NEA SUBSIDY FUNDED PROJECTS

A. Coverage

a. Projects included in the approved Comprehensive Electrification Masterplan (CEMP)/Total Electrification Masterplan (TEMP) and/or priority requests with funding allocations from the National Government are eligible for evaluation and release of funds subject to the approval of the Administrator.

b. Additional projects which have no funding allocation shall also be eligible for evaluation and release of funds upon approval of the Administrator and availability of funds/generated savings approved by the NEA Board of Administrators.

c. EC shall submit letter indicating the list of priority projects for the replacement of sitio/purok projects previously submitted/targeted to be implemented as approved by the Department of Budget and Management (DBM).

B. Schedule of Fund Release

1. The EC shall submit to NEA the Request for the Release of Construction Funds (RRCF/Budget Request) using the NEA Standard Form for its proposed/programmed electrification projects duly signed by its General Manager and Board President. The following supporting documents shall be attached in the RRCF:

a. Barangay Certification that the sitio is un-energized with the number of potential households and population (format attached as "Annex B")

b. Location Map

c. As plan staking sheets

d. As plan bill of materials

e. Certification on Right of Way Easement

f. Board Resolution

g. Execution Plan

h. Letter of Commitment to finish the project based on timeline

i. Feasibility Study for Underground Cable, Submarine Cable and

j. Mini-grid projects, as applicable

k. Other requirements for off-grid electrification projects

2. Funds shall be released as follows:

a. Initial release of ninety percent (90%) of the total evaluated project cost upon submission of copy of Notice of Award or Notice to Proceed issued to the winning bidder.

b. Final release of ten percent (10%) upon submission of Certificate of Completion, Certificate of Energization, Certificate of Final Inspection and Acceptance, final Accounting of Funds of the project with supporting documents, as Built Staking Sheets and Bill of Materials, Project Implementation Report, Summary of Household Connections including list of beneficiaries per sitio and Budget Request.

3. Subject to final inspection, subsidy fund received for the construction of distribution lines of a sitio without actual household connections shall be returned to NEA. Subsidy funded projects are subject to the usual accounting and auditing rules and regulations.

4. The RRCF for succeeding projects shall be processed only if the previous projects funded by subsidy were completed and a Certificate of Final Inspection and Acceptance was issued by a NEA Representative.

5. Reallocation/augmentation of subsidy funds within the list of projects under the same Memorandum of Agreement (MOA) is allowed.

6. The EC shall abide with all the provisions of the MOA covering the release of subsidy funds for the purpose.

7. Freight and handling should not exceed 15% for isolated EC and 10% for mainland EC of the total material cost (TMC), unless otherwise requested in actual costing and approved by NEA.

C. Implementation, Monitoring and Inspection

1. Periodic inspection shall be conducted by NEA for the following purposes:

a. Ensure that the funds released are properly utilized,

b. Determine that the projects are undertaken in accordance with the approved plans and specifications,

c. Determine the progress of work, and

d. Recommend remedial actions for any problem that may arise.

2. Accomplishment report and Certificate of Completion signed by the EC General Manager shall be submitted as basis for NEA's final inspection and acceptance.

3. The Certificate of Final Inspection and Acceptance (CFIA) for household connection shall be issued upon validation of the following using random sampling:

a. 20 sitios and below (50% of actual household connections)

b. Above 20 sitios (20% of actual household connections)

c. For realigned household connections, required random inspection is 50% of the completed actual connections.

D. Re-alignment for Unutilized and/or Excess Subsidy Fund

The EC should secure NEA's approval for realignment of unutilized and/or excess funds before implementation. The realigned projects shall be implemented and completed within six (6) months after the NEA's approval. Likewise, NEA shall continuously monitor the completion of the realigned projects for timely issuance of Certificate of Final Inspection and Acceptance.

For distribution line facilities:

1. Excess balances amounting to Php100,000 and above can be requested for realignment to same project/purpose thru a Board Resolution including supporting documents within one (1) month after final inspection and acceptance, otherwise return to NEA within the same period. Request for realignment will no longer be accepted beyond this period.

2. Excess balances below Php100,000 shall be returned to NEA within one (1) month after final inspection and acceptance.

For household connection:

1. The EC can only request for realignment within one (1) month after completion of at least 50% of the intended household beneficiaries and within the same barangays in the same MOA.

2. Only one request for realignment per batch of funded projects is allowed.

The realigned projects shall be implemented and completed within six (6) months after the NEA's approval. Likewise, NEA shall continuously monitor the completion of the realigned projects for timely issuance of Certificate of Final Inspection and Acceptance.

ECs are required to liquidate subsidy funds for realigned projects by submitting the original copies of the following documents within three (3) months after the conduct of final inspection and acceptance:

1. Accounting of Funds (AOF) per project basis.

2. Supporting documents for all transactions in the implementation of the realigned projects with COA prescribed checklist

3. Certificate of Final Inspection and Acceptance (CFIA).

VII. REWARDS SYSTEM

Compliance by the ECs with their legal mandate and role as the government's implementing arm in attaining total electrification shall be considered in the EC Overall Performance Assessment, granting of incentives, recognition and awards.

VIII. EFFECTIVITY

The Revised Policy shall immediately take effect fifteen (15) days after publication at the U.P. Law Center pursuant to Presidential Memorandum Circular No. 11 dated October 9, 1992.

This supersedes all the other issuances, guidelines, memoranda previously inconsistent with this policy.

(SGD.) EMMANUEL P. JUANEZAAdministrator

ANNEX A

2022 Updates on Housewiring Cost

 

Assembly Location	Particulars	Cost (Php)
A. Inside Assemblies	Materials	2,510.00
Labor (30% Total Material Cost)	753.00

Subtotal	3,263.00
Say	3,300.00

Outside Assemblies	Materials	1,210.00
Labor (30% Total Material Cost)	363.00

Subtotal	1,573.00
Say	1,600.00
Total	4,900.00

 

A. INSIDE ASSEMBLIES

 

Materials	Project Requirements	Units	Unit Price	Total Price (Php)
Circuit Breaker (15 Amps)	1	set	455.00	455.00
Receptacle	2	pieces	45.00	90.00
CFL Bulb (15 W)	2	pieces	131.00	262.00
Tumbler Switch	2	sets	55.00	110.00
Convenience Outlet (2 gang)	1	set	87.00	87.00
Junction Box (plastic with cover)	2	pieces	47.00	94.00
PDX Wire #10	5	meters	77.00	385.00
PDX Wire #12	10	meters	54.00	540.00
PDX Wire #14	10	meters	38.00	380.00
Electrical Tape	1	piece	47.00	47.00
Insulated, Staple Wire	30	pieces	2.00	60.00
Housewiring Labor (30% TMC)	-	-	-	753.00

TOTAL

3,263.00

 

B. OUTSIDE ASSEMBLIES

 

Materials	Project Requirements	Units	Unit Price	Total Price (Php)
EMT Entrance Cap, 3/4"	1	piece	45.00	45.00
EMT LB Conduit, 3/4"	1	piece	37.00	37.00
EMT Pipe, 3/4"	1	length	140.00	140.00
EMT Elbow, 3/4"	3	pieces	50.00	150.00
EMT Reducer, 1" X 3/4"	2	pieces	20.00	40.00
EMT Connector, 3/4"	5	pieces	15.00	75.00
EMT Coupling	4	pieces	30.00	120.00
PVC C-Clamp	6	pieces	3.00	18.00
Rod, Ground Steel, Galvanized, 5/8" X 10'	1	piece	510.00	510.00
Connector, Ground Rod (Clamp) for 5/8" Steel Rod	1	piece	25.00	25.00
Wire, Grounding, Aluminum Alloy, Stranded or Solid, #6	10	feet	5.00	50.00
Labor (30% TMC)				363.00

TOTAL

1,573.00

 

ANNEX B

Republic of the Philippines

CERTIFICATION

This is to certify that the following sitio/purok located at Barangay _____________________ of this Municipality has no electric service as of this date.

 

Name of Sitio/Purok	Population	Potential Households
Male	Female

 

Whereas, they are all within the franchise area of ________________________________ (____________).

Likewise, this certifies the absolute number of indigents and high incidence of poverty.

This certification is issued to formalize our willingness for energization, this _______ day of _______________, 2021 in the Office of the Punong Barangay.

___________________________

Republic of the Philippines

CERTIFICATION

This is to certify that the following sitio/purok located at Barangay ____________________ of this Municipality has no electric service as of this date.

 

Name of Sitio/Purok	Population	Potential Households
Male	Female

 

Whereas, they are all within the franchise area of ________________________________ (____________).

Likewise, to certify that the following sitio/purok project(s) for the Sitio Electrification Program (SEP) to be funded by subsidy are free from Right of Way (ROW)problem attested by the concern Barangay Captain/Official. cSEDTC

Furthermore, this certifies of the absolute number of indigents and high incidence of poverty.

This certification is issued to formalize our willingness for energization, this _____ day of _______________, 2021 in the Office of the Punong Barangay.

___________________________