ER 1-94 Corporate Social Responsibility Sustainability COVID-19 Response

AboitizPower backs move allowing LGUs to use ER 1-94 funds for COVID-19 response

April 28, 2020

Aboitiz Power Corporation (AboitizPower) welcomes the recent move of the Department of Energy (DOE), allowing communities that host power generation projects to use their revenue shares from these facilities to help them combat the effects of COVID-19.

AboitizPower President and Chief Executive Officer Emmanuel V. Rubio said this development is a push in the right direction as it is expected to aid in strengthening local government response to the ongoing health crisis.

“We thank Secretary Cusi and the DOE for this proactive initiative. We stand ready to collaborate with them and our local government units (LGUs) to facilitate the quick disbursement of these funds in the fight against COVID-19,” he added.

The DOE on April 6 issued Department Circular No. 2020-04-00080, which laid down rules on the targeted use of communities’ share in electricity sales for hosting power projects or the Energy Regulations 1-94 (ER 1-94) Program funds.

The ER 1-94 Program is a policy under the DOE Act of 1992 and the Electric Power Industry Reform Act of 2001 (EPIRA), which stipulates that host communities will get a share of one centavo for every kilowatt-hour (P0.01/kWh) generated by power plants operating in its area.

The fund can be used by host beneficiaries for the electrification of areas or households that have no access to power, development and livelihood programs, as well as reforestation, watershed management, health, and environmental enhancement initiatives.

With the new circular covering ER 1-94 funds, host LGUs can now use these shares to help manage the effects of the new virus, in accordance with the Bayanihan to Heal as One Act. This includes the facilitation of mass testing by providing and constructing facilities, as well as acquiring proper medical testing kits.

AboitizPower is currently downloading to around 130 host beneficiaries across Luzon, Visayas, and Mindanao P146 million worth of funds generated as of December 25, 2019.

Another P338 million from various AboitizPower-led generating companies, accumulated as of 2018, is also currently being remitted by DOE to the host beneficiaries.

“This is our contribution to the government’s efforts to ensure that all LGUs have enough resources to help contain, mitigate, and eventually eliminate the spread of COVID-19 in their areas,” Rubio added.