THE Supreme Court (SC) upheld the authority of the Department of Energy (DoE), the Energy Regulatory Commission (ERC), and the National Renewable Energy Board (NREB) to implement the fixed tariff system for renewable energy (RE).
In a decision written by Senior Associate Justice Marvic M.V.F. Leonen, the SC, sitting en banc affirmed Sections 6 and 7 of Republic Act No. 9513, which are designed to foster the growth of renewable energy sources and reduce greenhouse gas emissions.
Upholding a Court of Appeals ruling, the Supreme Court held that the law is complete and sets clear standards, thus validating the delegation of legislative powers to administrative agencies.
While Congress generally cannot delegate its powers, the SC said that it may authorize agencies to create rules and set rates on technical matters requiring specialized knowledge.
The tribunal noted that such delegation is necessary in matters requiring technical expertise.
The court also found that sections 6 and 7 ensure that agencies so delegated act within defined parameters.
Section 6 of the law establishes Renewable Portfolio Standards, requiring power suppliers and distribution utilities to source a minimum share of their electricity from renewables. The NREB determines this percentage.
Section 7 introduces the Feed-In Tariff (FIT) System, which provides incentives to renewable energy developers, such as fixed tariff payments and priority access to the power grid.
To implement these provisions, the respondent agencies issue resolutions approving the tariff rates and FIT Rules and Guidelines.
These include the FIT Allowance — a separate charge on consumers used to support the program. The SC upheld the advance collection of the FIT Allowance.
It clarified that although electricity from renewables must be generated before receiving FIT incentives, the law does not prohibit collecting funds beforehand to support the system.
The Court also found that the FIT Allowance aligns with the law’s objective to accelerate the development and use of renewable energy by establishing the necessary infrastructure and systems.
The SC found the NREB to be compliant with notice and publication requirements as laid down in the ERC Rules of Practice and Procedure.
The case stemmed from a challenge to the legality of the issuances, which resulted in claims that in determining how to implement the FIT System and the Renewable Portfolio Standard, the agencies improperly exercised legislative powers, which properly belong to Congress. — Chloe Mari A. Hufana