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Alan S. Cajes 

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Policies on Energy Efficient and Environmentally Sound Technologies 

Philippine Policies  on Energy Efficient  & Environmentally‐  Sound Technologies     

Prepared for the    Department of Science and Technology’s  “Small and Medium Scale Industries  in Asia: Energy, Environment &  Climate Interrelations Project”         

        Alan S. Cajes 

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Policies on Energy Efficient and Environmentally Sound Technologies 

© 2001 Department of Science and Technology and Alan S. Cajes All rights reserved. Published 2011. Printed in the Philippines Printing or copying information exclusively for personal and non-commercial use with proper acknowledgment of the author is allowed. Users are restricted from reselling, redistributing, or creating derivative works for commercial purposes without the express, written consent of the author. Alan S. Cajes 

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PREFACE ...................................................................................................................................................... 6  CHAPTER I. OVERVIEW OF E3ST AND SMES ................................................................................................... 7  1. FOUNDATIONS OF E3ST ................................................................................................................................... 7  1.1 Sustainable Development ..................................................................................................................... 8  2. NEED FOR E3ST ............................................................................................................................................ 12  TABLE 1. NEGATIVE ENVIRONMENTAL IMPACTS OF ENERGY SYSTEMS ........................................................ 12  3. SME SECTOR AND E3ST ................................................................................................................................. 14  3.1 Definition of SMEs .............................................................................................................................. 14  3.2 Role of the SMEs ................................................................................................................................ 14  3.3 Profile of SMEs ................................................................................................................................... 14  3.4 Support Programmes and Services ..................................................................................................... 15  3.5 Globalization of SMEs ........................................................................................................................ 16  3.6 Competitiveness of SMEs in Goods Production ................................................................................... 17  3.7 SMEs and E3ST.................................................................................................................................... 17  CASE STUDY: CERAMICS PRODUCTION IN REGION III ........................................................................... 18  CHAPTER II. ENVIRONMENTAL POLICIES RELATED TO E3ST .......................................................................... 23  1. HISTORICAL BACKGROUND .............................................................................................................................. 23  1.1 Colonial governments ........................................................................................................................ 23  1.2 From independence to 1972 ............................................................................................................... 24  1.3 Period from 1972 to the present ........................................................................................................ 25  2. CONSTITUTIONAL FRAMEWORK ....................................................................................................................... 26  2.1 Constitutional policy on environment ................................................................................................. 26  2.2 Constitutional policy on resource utilization ....................................................................................... 27  2.3 Mode of utilizing natural resources .................................................................................................... 28  2.4 Constitutional policy on due process and people participation ........................................................... 29  3. ROLE OF LOCAL GOVERNMENT UNITS ............................................................................................................... 30  4. INTERNATIONAL ENVIRONMENTAL AGREEMENTS ................................................................................................. 32  4.1 Basel Convention on the Control of Transboundary Movement of Hazardous Wastes and their  Disposal ................................................................................................................................................... 32  4.2 The Global Framework Convention for the Protection of the Ozone Layer and the Montreal Protocol  on Substances that Deplete the Ozone Layer ........................................................................................... 33  4.3 United Nations Convention on Biological Diversity Background ......................................................... 33  4.4 United Nations Framework Convention on Climate Change ............................................................... 33  4.5 Global Agenda 21 ............................................................................................................................... 34  5. STATUTORY ENVIRONMENTAL POLICIES ............................................................................................................. 34  CHAPTER III. ENERGY POLICIES RELATED TO E3ST ........................................................................................ 55  1. INTRODUCTION ............................................................................................................................................. 55  2. BACKGROUND OF ENERGY‐RELATED POLICIES AND LAWS ...................................................................................... 57  3. POLICY DIRECTIONS ....................................................................................................................................... 60  4. RECENT DEVELOPMENTS IN THE ENERGY SECTOR ................................................................................................. 61  4.1 Creation of the Department of Energy ............................................................................................... 61  4.2 Energy Plan Objectives and Strategies ............................................................................................... 65  4.3 Major Programs ................................................................................................................................. 66  3


CHAPTER IV. IMPACTS OF E ST‐RELATED POLICIES TO E ST PROMOTION ..................................................... 70  1. INTRODUCTION ............................................................................................................................................. 70  3 2. ECOLOGICAL FOUNDATIONS OF E ST‐RELATED POLICIES ....................................................................................... 71  2.1 Ecological Principles ........................................................................................................................... 71  PRINCIPLE OF RECYCLING OR REUSE ............................................................................................................... 71  PRINCIPLE OF RESTORATION .......................................................................................................................... 72 

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Policies on Energy Efficient and Environmentally Sound Technologies  PRINCIPLE OF CARRYING CAPACITY ................................................................................................................ 72  PRINCIPLE OF ADAPTABILITY .......................................................................................................................... 73  PRINCIPLE OF RENEWABLE RESOURCE USE ...................................................................................................... 73  2.2 Relationship between Ecological Principles and the Principles of Environmental Protection .............. 73  2.3 Principles of Environmental Protection in E3ST‐Related Policies.......................................................... 74  3. IMPACTS OF E3ST‐RELATED POLICIES ................................................................................................................ 76  3.1 Summary of Policies ........................................................................................................................... 76  3.2 Policy Implementation Instruments .................................................................................................... 78  3.3 Impacts of the Policies to the Promotion of E3ST ................................................................................ 97  CHAPTER V. POLICY GUIDELINES IN PROMOTING E3ST TO SMES................................................................. 110  1. INTRODUCTION ........................................................................................................................................... 110  2. POLICY GUIDELINES ..................................................................................................................................... 111  2.1 Framework for E3ST Promotion ........................................................................................................ 111  2.2 Requirements to Operationalize the Framework .............................................................................. 112  Environmental Responsibilities of LGUs ............................................................................................ 114  REFERENCES .............................................................................................................................................. 120  ABOUT THE AUTHOR ................................................................................................................................. 125 

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Preface This work was developed for the Department of Science and Technology (DOST) of the Philippines as part of the project “SMIs in Asia: Energy, Environment and Climate Interrelations” under the Asian Regional Research Programme in Energy, Environment and Climate (ARRPEEC)-Phase II. The project was funded by the Swedish International Development Co-operation Agency (Sida). In the Philippines, Dr. Alice B. Herrera served as the Philippine Project Coordinator of the SMI in Asia Project. She was the Officer-in-Charge of the Fuels and Energy Division, Industrial Technology Development Institute, DOST during the duration of the project. The initial version of the report was presented to various stakeholders during a number of fora in the Philippines. Useful comments and suggestions from the participants were considered in this work. In the spirit of sharing of information, which is essential in democratic traditions, this report is offered to the general public. The ideas expressed in this work are not to be considered as official positions of the project partners and the funders. All shortcomings are the responsibility of the author.

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Chapter I Overview of E3ST and SMEs "The old cherished idea that economic growth and energy consumption go hand-in-hand was shattered, and the "delinking" of them became the object of many studies and the basis of energy policies in numerous countries." - Professor Jose Goldemberg

1. Foundations of E3ST Modern environmental movement began with the publication of Rachel Carson’s Silent Spring in 1962, which argue about the “dangers of such recentlydeveloped agricultural chemicals as DDT, sending the world very specific warnings about the risks of postwar technologies that were producing artificial pesticides and other new chemical products.”1 Carson’s book inspired others to write about other threats to the quality and integrity of the environment. Some of these writings include Paul Ehrlich’s The Population Boom (1968), Barry Commoner’s The Closing Circle (1971), and the Club of Rome’s Limits to Growth (1972), which as written by a research team from the Massachusetts Institute of Technology. These writings stirred awareness among the westerners on the urgent need to protect the resources of the planet from overexploitation and degradation. In the United States, increased awareness was notable in college campuses, which intertwined the environmental issues with the Vietnam War. The Earth Day, which was held in April 22, 1970, “was largely a campus-based event that represented perhaps the apogee of the early years of the movement.” Soon, environmental organizations from the North and South sprouted and started building up networks and alliances. In 1972, the United Nations (UN) held a Conference on Human Development at Stockholm. The discussions that ensued “placed economic justice at par with the concern of many industrialized nations for environmental protection.”2 In 1980, the International Union for the Conservation of Nature and Natural Resources (IUCN) published the World Conservation Strategy: Living Resource Conservation for Sustainable Development, which states, in part, that “A new ethic, embracing plants and animals as well as people, is required for human societies to live in harmony with the natural world on which they depend for survival and well-being. The long-term task of environmental education is to foster or 1 2

From the 1995 Grolier Multimedia Encyclopedia. See Engel and Engel, 1990.

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Policies on Energy Efficient and Environmentally Sound Technologies  reinforce attitudes and behavior compatible with this new ethic.”3 In 1982, the UN adopted the World Charter for Nature which recognizes that “every form of life is unique, warranting respect regardless of its worth to man.” But the term sustainable development acquired fame with the publication of WCED’s Our Common Future in 1987. The term was also one of the central themes at the Rio Earth Summit or the UN Conference on Environment and Development (UNCED) in Rio de Janiero in June 1992, during which Agenda 21 was formulated to operationalize the sustainable development concept. Since then, other countries have developed their own Agenda 21. In the Philippines, the Philippine Agenda 21 was formally adopted in 1996. It serves as the comprehensive blueprint program for national development. 1.1 Sustainable Development4 Human beings use the material resources of the planet for their subsistence. Human beings, however, do not only use the material resources in order to live. Human life, itself, is sustained by the fundamental ecological processes of nature such as the natural capacities and services. Thus, the natural capital is essential for the satisfaction of fundamental human needs5. But the long-term fulfillment of fundamental human needs depends on the ability of people to sustainably use and manage the natural capital6. The former (sustainable use of material resources) observe five (5) principles: • • • • •

Consumption of renewable resources should not exceed their capacity to regenerate; Consumption of renewable resources must not degrade the biodiversity of the ecosystem; Consumption of nonrenewable resources should be minimal; A “proportion of nonrenewable resources should be set aside for the physical manufacture of renewable substitutes and the development of such substitutes should be given priority in resource consumption,’ and Consumption of nonrenewable resources should be within minimum strategic levels.

The latter (sustainable management of natural capital) observes four principles: •

The assimilative and regenerative capacity of the environment should not be degraded;


See IUCN, 1980. The World Commission on Environment and Development describes sustainable development as meeting the needs of the present without compromising the ability of future generations to meet their own needs. 5 Manfred Max-Neef, identifies ten fundamental human needs: subsistence, protection, affection, understanding, participation, idleness, creation, identity, freedom, and transcendence. See David Reid, 1995. 6 See David Reid, 1995. 4

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Policies on Energy Efficient and Environmentally Sound Technologies  • • •

The assimilative and regenerative capacities of the environment should not be used for the dispersal of stock wastes or non-biodegradable substances; The natural life-support systems must not be destabilized, and Environmental quality must not be degraded.

In other words, sustainable development implies that the environment “should be protected in such a condition and to such a degree that environmental capacities (the ability of the environment to perform its various functions) are maintained over time: at least at levels sufficient to avoid future catastrophe, and at most at levels which give future generations the opportunity to enjoy an equal measure of environmental consumption.”7 Environmental protection, therefore, is indispensable to sustainable development. In fact, the idea of sustainability emerged “out of the need to define what is meant by environmental protection.”8 The protection or enhancement of the natural capital requires a sustainable pattern of production and consumption, which involves the enhancement of “environmental quality through the efficient production and use of natural resources, the minimization of wastes, and the optimization of products and services.”9 Based on the criteria developed by the World Business Council for Sustainable Development (WBCSD), sustainable production and consumption • • • • • • • • • •

Stimulates market forces; Promotes more efficient use of materials and energy; Establishes pricing systems that internalize environmental cost; Supports recycling and reuse (considering overall life-cycle effects); Provides flexibility to choose effective solutions; Supports a process of continuous improvement; Stimulates economic growth; Promotes innovation; Minimizes trade barriers, and Encourages technology and systems sharing10

In line with these criteria, the United Nations Commission on Sustainable Development (UNCSD) encourages business to integrate environmental criteria into its purchasing policies, design more efficient products and processes, increase the life spans for durable goods, improve after-sales service, reuse and recycle, and promote sustainable consumption through advertising, marketing and product information.


See Michael Jacobs, 1991. Ibid. 9 See Edwin Falkman, no date. 10 Ibid. 8

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Policies on Energy Efficient and Environmentally Sound Technologies  The initiatives of WBCSD and UNCSD find support from the Oslo Ministerial Roundtable in February 1995 which defines sustainable production and consumption as the “production and use of goods and services that respond to basic human needs and bring a better quality of life, while minimizing the use of material resources, toxic materials and emissions of waste and pollutants over the life cycle, so as not to jeopardize the needs of future generations.”11 The WBCSD and UNCSD initiatives also led to the development of industrial ecology that involves the efficient use of resources, extension of the life cycle of products, pollution prevention, recycling and reuse, and the establishment of eco-industrial parks. Industrial ecology promotes the • • • • •

Efficient and sustainable use of material resources and energy; Extension of the useful life of products; Prevention of pollution at any point in the product cycle through operational, technical or behavioral changes as well as process substitution, product reformulations or housekeeping improvement; Reduction in the “consumption of virgin materials” and diversion of “waste from final disposals in landfills,” and The attraction of “business that we can feed off one another.”12

There are other dimensions of sustainable development but for the purposes of this study four recognized principles of environmental protection13 have direct bearing on E3ST. These are the Precautionary Principle, Substitution Principle, Best Available Technology Principle, and Polluters Pay Principle. The Precautionary Principle is regarded as the philosophical expression of the self-preservation instinct that "we all tend to apply in all our actions.” In practice, it means to “modify the manufacture, marketing or use of products or services to the conduct of activities, consistent with scientific and technical understanding to prevent serious or irreversible environmental degradation.”14 In essence, the principle means that prevention is always better than cure, thus, the exploitation of natural capital “which causes significant damage to the ecological balance must be avoided.”15 In the Rio Declaration, the precautionary principle finds its way in Principle 15 which states that: 11

Ibid. Ibid. 13 Several environmental principles, which any economic activity should observe, have been developed and accepted during the past few years. Of these principles, the principle of sustainable development is the most comprehensive and is regarded as the umbrella principle of the other principles. 14 See Welfor and Gouldson, 1993. 15 Ibid. 12

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Policies on Energy Efficient and Environmentally Sound Technologies  “In order to protect the environment, the precautionary approach shall be widely applied by States according to their capabilities. Where there are threats of serious or irreversible damage, lack of full scientific certainty shall not be used as a reason for postponing cost-effective measures to prevent environmental degradation.” In the words of John Pezzey, the “precautionary principle aims to achieve maximal reductions in pollution using the ‘best available technology’.” The basis of the Substitution Principle is the idea “that substances and products which present a danger to health and the environment are to be substituted by less dangerous ones.”16 This principle is a feature of current Swedish law, particularly in Act (1985:426) on Chemical Products, which states that: “Anyone handling or importing a chemical product shall take such steps and otherwise observe such precautions as are necessary to prevent or minimize harm to human beings or to the environment. This includes avoiding chemical products for which less hazardous substitutes are available.”17 The Best Available Technology Principle represents what Ericson calls a formalization of common sense. The European Commission’s proposed new Directive on Integrated Pollution Prevention and Control dated September 1993 explained this principle, thus "The term ‘Best Available Techniques’ signifies the latest stage of development (state of the art) of activities, processes and their methods of operation which indicate the practical suitability of a particular technique for preventing, or where that is not practicable, minimizing emissions to the environment as a whole.” The term “techniques” includes the technology used and how it is designed. In addition, it has to be industrially feasible. “Available” in BAT refers to “existing technologies or procedures that can be applied at a reasonable cost.” The term “best” refers to the technology which has the ‘greatest purification effect or the lowest emissions and which is in commercial application somewhere in the world.” The Polluter Pays Principle, as the term implies, means that the polluter pays for the cost of pollution. It has five implications:

16 17

See Jernelov in Swedish Environmental Advisory Council, 1994. Ibid.

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Policies on Energy Efficient and Environmentally Sound Technologies  • • • • •

It covers the cost of environmental protection; It covers pollution and control measures to promote the efficient use of limited material resources; It covers the cost of pollution control and cleanup, and compensation to victims or to those who suffer damage from pollution; It ensures the “effective distribution of the responsibility for cost and that it neither imposes demands nor excludes the possibility of reducing pollution to an optimum level,” and It includes the “internationalization of environmental costs and the use of economic instruments.” 2. Need for E3ST18

The efficient use of energy and the application of environmentally-sound technologies (E3ST) aim to minimize, if not prevent, the "economic, environmental and other social costs of electricity conversion and use." The goal hinges on the fact that economic development requires access to energy. Generally speaking, the rise in economic activities translates into an increase in energy consumption, which, in turn, requires growth in energy production. But rapid energy production produces negative environmental impacts, which will ultimately take their toll on development itself. (See Table 1 for the negative environmental impacts of energy production and distribution systems). Examples of significant negative environmental impacts from energy use are "atmospheric pollution from coal and oil burning in both the stationary and transport sectors."19 And if society takes seriously the paradigm of sustainable development to secure a "common future" there is no arguing that development cannot be sustained amidst a degraded environment. Table 1. Negative Environmental Impacts of Energy Systems Hydroelectricity

Thermal Electricity

18 19

Deforestation Soil erosion/siltation Water logging Salinization Displacement of people Social iniquities - land, agriculture Loss of biodiversity Resource degradation Emissions to air Emissions to water (including heat) Emissions to solid waste (ash) (during fuel production, processing, and conversion)

See Swisher, Januzzi and Redlinger, 1997. See Ramani, Hills, and George, 1992.

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Policies on Energy Efficient and Environmentally Sound Technologies  Nuclear Electricity

Resource depletion Release of radionuclides Waste disposal High cost/economic Site selection, land use Biomass Deforestation Emissions to air Hardship to women (gatherers) Loss of soil fertility Soil erosion Agricultural chemicals Fossil Fuels Combustion Emissions to air Trace metal emissions Emissions to land and water from spills Renewable Energy Cost Availability of sites, other resources Energy Conservation Cost Technology Other Debt Aesthetics Noise Source: Ramani, Hills, and George, 1992.

Ramani, Hills, and George, however, recognize the "shortage of resources at the demand end for the promotion" of E3ST in developing countries. In general, the following are the reasons why consumers do not buy efficient end-use devices: • • • •

Efficient devices may not be available; It is not clear which designs are efficient; Extra capital cost is entailed, which deters purchases even though the lifetime cost may be lower than that of inefficient types, and Consumers do not know that efficient devices are cost-effective and environmentally desirable. To overcome these constraints, Ramani, Hills, and George propose the following measures:

• •

Political awareness. - There is a need to conscientisize the political decision makers about the advantages of demand management such as reduced dependence on capital borrowings for large energy supply projects, increased national and regional self-reliance, and reduced dependence on imported oil. Internalization in planning. Project, program and development planning should take into consideration issues or concerns related to energy use and environmental quality. Standards and regulation. Efficiency standards for all energy-using devices should be set and enforced taking into consideration the international nature of production and marketing of such technologies, as well as specific characteristics or requirements of individual countries and regions.

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Policies on Energy Efficient and Environmentally Sound Technologies  • • •

Financial measures. The use of economic instruments or financial policies should aim at encouraging the efficient use of energy. Information and education. Energy users, planners and consumers should be educated and informed about the energy-environment interactions and impacts. Technology transfer. Countries should institutionalize the use of technology assessment as a tool for selecting the most appropriate technology. This is in consonance to the Best Available Technology Principle. 3. SME Sector and E3ST

E3ST can be applied in various sectors of society such as agriculture, households, industries, transport, and commercial services, which are the consumers of energy. This, study, however, will focus on SMEs or SMIs. The development and promotion of Small and Medium Enterprises (SMEs) is one of the strategies of the Philippine government to spur rural industrialization. SMEs are vital in the country's goal to attain social-economic development, specifically in employment generation, productivity improvement, income redistribution, and poverty alleviation. The country's SMEs comprise 99% of the total manufacturing establishments and contribute 54.9% in employment generation and 28.1% of the value-added in production. Most of the SMEs are concentrated in the National Capital Region, Southern Tagalog Region, and in Central Luzon. 3.1 Definition of SMEs SME refers to any business activity or enterprise engaged in industry, agribusiness or services whether single proprietorship, cooperative, partnership or corporation. Small and medium enterprises are those which have an asset size of P1,500,000 - P15,000,000, and P15,000,000 - P60,000,000, respectively. In terms of number of employees, small enterprises have 10-99 workers while medium enterprises have 100 to 199 workers. 3.2 Role of the SMEs SMEs contribute to the national economy in terms of the following: • • • • • •

Rural industrialization, rural development and decentralization of industries; Creation of employment opportunities and more equitable distribution of income Utilization of indigenous resources Earning of foreign exchange resources Creation of backward and forward linkages with existing industries Entrepreneurial Development

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Policies on Energy Efficient and Environmentally Sound Technologies  Number of Establishments The total number of business establishments in 1995 (both in the manufacturing and service sectors) reached 494,974. The medium enterprises totaled 2,712, while the large establishments numbered 2,487. The rest of the establishments consisted of micro, cottage and small enterprises, which make up 99% of all business establishments. Employment SMEs generated 1,438,643 jobs in 1993 compared to the 66,502 jobs created by the large enterprises. The food-processing sector generated the most jobs among the manufacturing SMEs, followed by the wearing apparel sector, fabricated metal products and furniture sector. The food sector contributed 18.6% of the total jobs generated by the small and medium manufacturers in the same year. But in terms of value added, the micro, small and medium enterprises contributed about 25% of the total. Geographical Spread of SMEs Although small enterprises are more equally distributed between the National Capital Region and the other regions, about 85% of the micro-enterprises is predominantly found in other regions. About 75% of the medium sized enterprises is located in Metro Manila. Sectoral Distribution SMEs are found in practically all major subsectors. However, most of them (more than 78%) are concentrated within a fairly traditional range of product groups: food processing, garments, gifts/toys/handicrafts (GTH), metal working, footwear and leather goods, wood and bamboo products and building materials. Food processing alone accounts for 43% of all manufacturing establishments, and the food processing enterprises are mainly (94%) micro-enterprises, with small enterprises comprising a further 5%. The pattern is broadly similar in garments, which accounts for 18% of all manufacturing establishments, of which 91% are microenterprises. Nevertheless, the only prominent concentration of medium and large firm also found in the garment sector. 3.4 Support Programmes and Services Government agencies and the private sector, including non-governmental organizations (NGOs), provide support programs and services to Philippine SMEs. Local government units (LGUs) are also increasingly giving SME assistance and development. Furthermore, government financing and international lending institutions are devoting more of their lending portfolios to micro, cottage, small and medium enterprises (MCSMEs).

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Policies on Energy Efficient and Environmentally Sound Technologies  Available SME programs can be classified into four general categories: (1) financial: (2) technical, which covers entrepreneurial and workers training, marketing; production and technology transfer; (3) backward linkages and (4) research and information. Financial Assistance Programmes The Development Bank of the Philippines (DBP) and the Technology Resource and Livelihood Center (TLRC) provide financing assistance to SMEs. The Department of Trade and Industry (DTI) - Small Business Guarantee and Finance Corporation (SBGFC) also operates a regular guarantee facility and a small enterprise financing facility (SEFF). Another government credit agency facility is the Guarantee Fund for Small and Medium Enterprises (GFSME). In the Board of Investments (BOI), the Entrepreneurial Development Service Department assists registered SMEs in sourcing funds. Technical Assistance Programmes The technical assistance programs available to SMEs come in the form of training and consultancy, marketing, design and product development, packaging and many other areas considered critical to the formation of productive and globally competitive small firms. Marketing Assistance Various government agencies, in coordination with the private sector, have evolved various programs to promote Philippines product to the export market. Backward Linkages This SME support mechanism, which is a recent innovation of the BOI, links SMEs that can supply components and other raw materials to large companies that need such suppliers. To support this mechanism, BOI runs an information exchange and assistance facility that identifies SME firms which can be tapped by the BOIregistered companies. The automotive industry is one sector where this scheme is workable, with SMEs in the metals and engineering field supplying the parts and components needed by the major automotive companies. 3.5 Globalization of SMEs SMEs will have to contend with three major trends in the future. First is the globalization of enterprises. With tariff and non-tariff barriers being reduced by trading nations worldwide, the movement across borders of capital, goods, services, and information technology is considerably eased. Consumers thus have a choice of where they will park their patronage and spend their money on. Rapid technological change effectively tends to lower the cost of goods and services. This is happening in a period of undeniably unstoppable liberalization of trade and investment policies not only in democratic countries but even in centralized economies. Alan S. Cajes 

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Policies on Energy Efficient and Environmentally Sound Technologies  Second is the signing of the ASEAN Free Trade Area (AFTA) arrangement, which effectively opens up both unparalleled opportunities, and stiff competition in the near-term. The trade and investment liberalization and facilitation measures, together with economic and technical cooperation being fostered within APEC will also change the shape and pace of competition and the way business is done within the region. Third are the national efforts to address problems that have prevented SMEs in the past from riding the growth track. Special incentives and assistance schemes for SMEs are now available, as are a number of special financing programs. Public and private sector agencies are involved in organization building, precisely to further strengthen and sustain the mechanisms and institutions that assist in micro-venture start-ups and to hasten their growth and transformation into globally competitive SMEs. 3.6 Competitiveness of SMEs in Goods Production SMEs have a distinctive competence, particularly in the area of good production. These advantages include the following: • • •

• •

Where the volume required is limited, mass production by mechanization is not applicable on a large scale. Smaller enterprises are more suited in such situation; Where the market is limited to certain regions or influenced big manufacturers who have to transport the goods from outside the region, small firms operating in the community can economically meet the selective demand for them; Products calling for high precision and narrow tolerance are usually better produced by SMEs. Because of the nature of the products, a simple organization where the owner - manager can still closely and control production has an advantage; SMEs are in a better position to turn out products, which are light, small, of moderate precision and frequently made of light equipment or by relatively simple assembly operations. SMEs are labor - intensive and use relatively simple techniques of production that correspond to the abundance of labor and the scarcity of physical and human capital that prevail in most developing countries.20

3.7 SMEs and E3ST Since SMEs are labor intensive and use relatively simple tools of production, they are in a good position to practice energy efficiency. However, that is not always the case. In the case of the Ceramics Sector in Region III (See Case Study), the industry faces problems like the lack of modern and adequate plant and equipment. For instance, about 27% of its present machinery and equipment is antiquated. In terms of preventive maintenance, most firms need to institute a regular maintenance schedule to prevent machine breakdown, prolong the use of existing machines, and 20

This presentation of Philippine SMEs is mostly taken from data prepared by the Singapore Productivity and Standards Board (PSB). This writer participated in an APO Study Meeting on ISO 9000 and ISO 14000 in 1999 held at PSB.

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Policies on Energy Efficient and Environmentally Sound Technologies  minimize their negative impacts to the environment. In addition, the sector requires about nine trucks of firewood per month for its production. The use of firewood is obviously related to environmental problems such as deforestation and climate change, not to mention the negative health impacts of firewood burning. This is compounded by the usual inefficiency in the use of firewood heat that results in waste heat and reduced productivity. There is no exact data of the pollution caused and energy consumed by SMEs. But the sheer number of SMEs in the country and the degree of their economic activities are more than enough to cause worry to environment professionals and activists. Thus, it is timely to introduce E3ST to SMEs.  

Case Study: Ceramics Production in Region III21 

Ceramics Manufacturers    The  Department  of  Trade  and  Industry  (DTI)‐Pampanga  Provincial  Office  registers  some  40 ceramics firms, most of which are  located in the Municipality of Santo Tomas. These  firms employ some 2,000 workers. At the average, Pampanga firms have 23 regular workers, 22  contractual workers, and 13 subcontractors. Although some firms started their operations in the  1960s, most of the firms were established in 1986.    Eleven of the firms export their products, while the rest cater to the domestic market.  Export  products  include  decorative  plates,  dinnerware,  garden  pieces,  etc.,  while  the  products  for the domestic market are traditional pots, planters, jars and vases. The average monthly sale  of exporting firms is $34,507.45, while firms that cater to the domestic market have an average  sale  of  P164,648.57.  Most  of  the  sales  are  on  cash‐on‐delivery  (COD)  mode  and  the  rest  are  either on credit or post‐dated check schemes.  And to ensure the payment of delivered products,  producers require a 50% letter of credit or telegraphic transfer from foreign buyers.    Production and Sales Performance    From  1993  to  1998,  Central  Luzon  posted  an  average  export  growth  rate  of  126%.  About  80%  of  the  ceramics  products  came  from  Pampanga,  which  is  known  for  its  ceramics  products that are of superior design and quality. In 1998, Pampanga's ceramics export amounted  to $6.326 million22, which is 80% of Central Luzon's total ceramics export.  In  terms  of  production  capacity,  most  firms  have  between  60‐80%  actual  capacities.  Current  monthly  production  is  placed  at  195,000  pieces.  This  is  equivalent  to  245  1x20"‐footer  container vans.  But in terms of production quality, the rejection rate of the firms ranges from 2‐ 55%.  The  cause  of  rejects  include  breakage/cracks,  poor  quality  of  the  clay,  improper  clay  preparation/formulation,  mishandling,  improper  firing,  negligence,  improper  measurement,  handmarkings on the products, overdrying, improper packing and finishing, etc. About 40% of  the causes of rejection is attributed to poor clay quality, while 86% is process‐ or labor‐related.    Ownership   


The discussion of this paper does not include the decorative ceramics, which is a sub-sector of the Gifts, Toys and Housewares (GTH) Sector. Accordingly, the discussion of decorative ceramics falls under the GTH Sector. The materials made available for this paper focuses on pottery, which uses red clay, in the Province of Pampanga. 22 The source of this data does not present the contribution of decorative ceramics.

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Policies on Energy Efficient and Environmentally Sound Technologies  Most  of  the  firms  are  run  by  single  proprietorship.  Family  members,  who  safeguard  trade  secrets  or  classified  manufacturing  processes,  manage  these  firms.  The  other  firms  are  organized as corporations, with a few managed by partnerships.    Most of the ceramics producers are into micro, cottage and small‐scale operations23 and  use  the  traditional  method  (firewood  for  pugon)  of  production.  However,  bigger  firms  use  modern equipments like modern kilns.     Raw Material Requirements    The Pampanga ceramics industry uses clay (about 615 trucks per month), sand (about  172  trucks  per  month),  and  firewood  (about  nine  trucks  per  month).  The  average  cost  of  raw  materials is P1,738/truck for clay, and P1,320/truck for sand. These materials are available within  the region and their prices would vary according to source.    About  73%  of  the  raw  materials  is  paid  upon  delivery,  although  some  firms  enjoy  a  credit  line  that  lasts  from  two  weeks  to  one  month.  Because  most  of  the  suppliers  require  outright  payment,  the  lack  of  working  capital  hampers  the  operations  and  growth  of  the  industry.    Marketing and Promotion    Promotion  of  ceramics  products  is  generally  through  participation  in  trade  fairs  and  exhibits,  as  well  as  through  the  distribution  of  product  brochures  and  samples  to  potential  buyers. The firms that have internet access use the worldwide web in promoting their products.  There  are  some  firms,  however,  that  "promote"  their  products  in  terms  of  maintaining  loyal  customers and meeting their requirements.     Government Assistance    DTI‐Pampanga Provincial Office provides assistance to the local manufacturers through  its Development of Rural Industries and Village Enterprises (DRIVE) Program. The assistance is in  the form of market linkage, consultancy, and product development.     Investment Opportunities    Within the next three years, about 53% of the producers plan to expand their operations  in terms of investments in fixed assets and improvements of existing facilities. Such plans will be  financed using owners' equity and long‐term loans. The rest of the producers prefer to maintain  their current level of operations due to the lack of capital, limited product demand, and the not‐ so‐favorable economic condition prevailing in the country.    In  terms  of  financial  structure,  most  of  the  firms  have  liabilities  that  represent  about  35%  of  their  total  assets.  Add  to  this  is  the  fact  that  most  firms  are  micro  and  cottage  enterprises.  Thus,  many  firms  have  difficulty  in  securing  money  to  finance  expansion  and  modernization projects.     Industry Association    About 40% of the firms does not belong to an industry or trade association. Only 24% of  the  firms  belongs  to  the  Pottery  Exporters  and  Manufacturers  Association  of  Pampanga  (PEMAPI)  and  about  21%  is  under  the  Philexport.  In  the  case  of  the  Ceramics  Export  Manufacturers' Association, Inc. (CREMA), only 2% of the firms is a member.   


A survey identified only one medium-sized firm that is into ceramics production.

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Policies on Energy Efficient and Environmentally Sound Technologies  Issues/Concerns and Recommended Actions     The  industry  is  confronted  with  problems  like  the  lack  of  modern  and  adequate  plant  and  equipment.  About  27%  of  its  present  machinery  and  equipment  is  antiquated.  In  terms  of  use,  majority  of  the  machineries  (about  63%)  is  used  for  196‐624  hours  per  month.  Although  some  firms  have  daily  (about  23%  of  firms)  and  monthly  (about  33%  of  firms)  preventive  maintenance activities, the rest of the firms need to institute a regular maintenance schedule to  prevent machine breakdown, as well as to prolong the life‐span of existing machines.    The industry also faces stiff competition posed by other Asian countries like China and  Thailand.  These  competitor‐countries  enjoy  a  price  advantage  over  the  Filipino  producers  because  of  their  cheaper  labor  cost,  cheaper  cost  of  power  and  fuel,  and  cheaper  cost  of  raw  materials.    Despite  these  problems  or  challenges,  the  industry  has  penetrated  the  markets  in  Europe  (Germany,  Italy,  France,  United  Kingdom,  Portugal  and  Sweden),  United  States  of  America, Australia, Japan, Middle East, and Asia.      During a consultative meeting conducted by this writer on October 26, 1999 at the DTI‐ Pampanga  Provincial  Office  and  attended  by  representatives  of  the  industry,  the  following  issues and concerns vis‐à‐vis recommended actions surfaced:    Issues and Concerns (Red Clay) 

Recommended Actions 


While local  materials  (red  clay)  are  available  • and  affordable,  there  are  no  standards  to  determine their quality   

Finishing materials  such  as  glaze,  china  ball  • clay and colorings are imported24   

Government through  DOST  should  conduct studies to develop local glazes. 

Lack of  support  industries  for  clay  skills  • training and upgrading and clay processing 

Establish a  clay‐processing  center  that  will  ensure  that  local  clay  meets  the  quality standards. 

A Common  Service  Facility  (CSF)  should  be  established  to  provide  a  common  service  for  skills  training  and  upgrading  and clay processing. 

High production  cost  (high  freight  and  labor  • cost,  lack  of  power  supply  and  high  power  rates, and high tariff)   



Lack of technical capability 

Design and develop high‐end products as  well  as  explore  the  possibility  of  establishing  a  production  center  in  competitor‐countries. 

Government should  promote  courses  such  as  Ceramics  Engineering  and  Ceramics  Technology  in  State  Colleges  and  Universities  located  in  areas  that  require such expertise. 


This constitutes about 1% of total raw materials requirements

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Policies on Energy Efficient and Environmentally Sound Technologies  •

Establish a  CSF  that  can  provide  skills  training  and  upgrading.  The  CSF  could  also  hire  design  and  production  consultants. 

Lack  of  technology  (especially  modern  • equipment  for  speedy  and  quality  production) 

Government should provide assistance to  producers  in  the  acquisition  (or  development  through  the  DOST  and  other  related  agencies)  of  modern  equipments  such  as  clay  processors,  dryers and kilns. 

Lack of capability to prepare marketing plans 

DTI should  assist  or  train  producers  on  how to prepare proper marketing plans 

Untimely designs25 

DTI and  ceramics  industry  associations  should  provide  training  programs  on  product  designing.    The  CSF  could  also  facilitate this 



Lack of  capital  and  high  interest  rates  for  • loans 

Government should  coordinate  with  financial  institutions  to    provide  windows  or  facilities  for  credit  to  producers  at  low  or reasonable interest rates 



No Common  Service  Facility  (CSF)  in  • Pampanga 

A CSF  should  be  established  in  the  province  to  serve  as  a  common  provider  of processed clay and glaze, as well as to  serve  as  a  testing,  research  and  development facility for the industry. 



Longer delivery lead time26 

Change from manual labor to automation  through  the  acquisition  of  machineries  and  equipment  at  lower  tariff  rates.    The  establishment  of  a  CSF  could  facilitate  this. 

Lack  of  product  exposure  in  foreign  • markets27 

Government should  provide  financial  assistance  for  SMEs'  participation  in  international  trade  fairs  and  product  exhibits abroad 


This is due to the lack of knowledge about market requirements and trends 30 days for big companies; 60 days for SMEs. The delivery lead-time could increase when there are more orders. 27 This is true for SMEs that cannot afford the cost of participating in international trade fairs and product exhibits abroad. 26

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Policies on Energy Efficient and Environmentally Sound Technologies  Others 


Government has  long  and  tedious  processes  • that delay the delivery of products 

Establish a one‐stop processing of export  documents in Pampanga, instead of going  to Manila28. 

Piracy  of  workers  and  product  designs  by  • local  and  international  competitors  notably  China and Vietnam    •

Promote industry  clustering  and  cooperation to address this problem  Explore  the  possibility  of  establishing  a  production center in competitor‐countries  to improve industry competitiveness  To prevent the piracy of product designs,  producers  should  go  for  high‐end  products,  as  well  as  the  production  of  artistic and sophisticated products. 

Low  quality  of  infrastructure  (roads,  bridges  • and flood prevention) 

Government should  improve  the  quality  of  roads  and  highways,  increase  the  weight  capacity  of  bridges,  and  provide  infrastructure support to prevent flooding  that affects the producers.  Shipping  could  also  be  done  in  Subic  rather than in Manila to facilitate product  delivery and improve delivery lead‐time. 


The Export Development Council representative informed the group that a similar service has been opened lately in Clark.

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Policies on Energy Efficient and Environmentally Sound Technologies 

Chapter II Environmental Policies Related to E3ST 1

"Ignorance of the laws of nature excuses no one." - Anonymous

1. Historical Background2

1.1 Colonial governments The Spanish Law of Waters of 1866 was implemented by the Spanish government in the country in 1871. It is the earliest legal edict on environment and states that “when an industrial establishment was found, after due investigation, to have contaminated the water with substances or properties noxious to the public health, the Governor-General could suspend its operations until the owner adopted a suitable remedy." Under the American rule, environmental laws consisted mainly of regulations on the allocation and utilization of forest, water, and fisheries resources. An example of these laws is the Spooner Amendment to the Army Appropriation Bill of 1901 which provides “that no sale of lease or other disposition of public lands or the timber thereon, or the mining rights therein shall be made…until the establishment of a permanent civil government.” This provision was strengthened in 1902 when the Forestry Bureau was given the power to ascertain and delimit lands for agricultural and forest purposes. The basis of the present-day statutory and administrative provisions for the appropriation of public water is embodied in Act No. 2152 that was passed by the Philippine Legislature in 1912. The order of priority in allocating water uses as provided in Section 3 thereof is as follows: domestic, agricultural, industrial, fishponds, and mining. As regards the fisheries resources, Act No. 4003, otherwise known as the Fisheries Act (1932) sets the rules and regulations on the exploitation of fishery resources by prohibiting the use of toxic substances and explosives in fishing, banning the gathering of fry or fish eggs and small fish not more than three (3) centimeters long, except for propagation or educational 1

See Antonio G. M. La Vina, Basic EIAME Course Module B: Natural Resource and Environmental Policy Framework (no date); EMB and UNDP, Training Module No. 1: Implications of Environmental Legislation to Development Sectors (no date); Amado S. Tolentino, Environmental Law in the Philippines, Materials and Comment, pp. 7-8 2 See EMB and UNDP, Training Module No. 1: Implications of Environmental Legislation to Development Sectors (no date)

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Policies on Energy Efficient and Environmentally Sound Technologies  purposes, and forbidding the discharge or disposition of petroleum, chemicals, refuse or other substances deleterious to fish or aquatic life. Wildlife conservation concerns are notable in the various legislative acts on protection of flora and faunal species found in wilderness areas. Protection of wild animals is provided in Act No. 2950 of 1916 and its various amendments. The list of protected wild animals, however, was limited to game species of birds, fishes, and mammals. The conservation of non-game animals was totally ignored. Act No. 3983 of 1932 provides for the protection of wild flora by prohibiting outright the collection of rare wild plants. It was also during the period of colonial governments that the basic legal foundation for the creation of national parks was enacted. Act No. 3915 of 1932 mandates that “any portion of the public domain which, because of its panoramic, historical, scientific or aesthetic value, should be dedicated and set apart as a national park for the benefit and enjoyment of the people of the Philippine Islands.” During the Commonwealth period (1936-1942), the promulgated laws predominantly regulate the development and utilization of the country’s economically most important non-renewable resource – minerals. Commonwealth Act No. 137 or the “Mining Act” (1936) defines the regulations for the exploration, disposition and development of minerals and mineral lands. Section 77 of this Act declares that “every lease granted…shall contain a clause by which the lessee shall bind himself to comply with such rules and regulations for the policing and sanitation of mines, easements, drainage, disposal of wastes or tailing…” The implementing rules and regulations (IRR) of this Act provides the following sanctions for violations: “any person who willfully and maliciously causes or permits sludge or tailings to accumulate in, or flow from his mining claims so as to cause danger, injury or obstruction to any public road, rivers, or streams or other public property, shall be punished upon conviction, by a fine not exceeding two hundred pesos, besides paying for any damage which may have been caused thereby." Commonwealth Act No. 383 of 1938, although enacted in relation to flood control and to navigational uses of river streams, is the first law to deal directly on waste disposal. Also known as the Anti-Dumping Law, Section 1 thereof prohibits the “dumping into any river of refuse, waste matter, or substances of any kind whatsoever that may cause an elevation of the level of river beds, or block the course of streams…” 1.2 From independence to 1972 During this period, the trend in environmental legislation continued to focus on the natural resources sector. In the fisheries sector, for instance, laws were passed prohibiting the use of fishing methods that would lead to the depletion of fishery resources. Thus, RA 428 (1950) as amended by RA 1535 (1956) declares as illegal the possession, sale, or distribution of fish or other Alan S. Cajes 

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Policies on Energy Efficient and Environmentally Sound Technologies  aquatic animals stupefied, disabled or killed by means of dynamite or other explosive or toxic substances. Other laws enacted prohibit trawl fishing in areas that are less than seven fathoms deep (RA 3048 of 1961), exploration of bangus fry (RA 3586 of 1963), and electro-fishing in freshwater areas (RA 6451 of 1972). In the forestry sector, laws on reforestation and afforestation were passed such as RA 115 of 1947 and RA 737 of 1952 that provide for the reforestation and afforestation of denuded areas within public forestlands. Establishment of municipal and city forests, tree parks, and watersheds was encouraged, as embodied in RA 5752 of 1969. In 1949, the Petroleum Act was enacted to promote the development of petroleum resources in the country. Article 24 thereof includes, as one among the general obligation of a concessionaire, the institution of measures to avoid hazards to life, health, and property and prevent pollution of air, land and water. The landmark wildlife conservation measures passed during this period were RA 826 of 1952 (providing the creation of the Commission of Parks and Wildlife whose main purpose is the development, maintenance, and conservation of national parks, national monuments and wildlife), RA 1086 of 1954 (calling for stricter enforcement of the prohibition against the killing of the tamaraw), and RA 6147 of 1970 (declaring the Philippine Eagle as a protected bird in the country). The enactment of RA 3931 in 1964 added a new dimension to environmental policy. The law is the first legal declaration that pollution control is a major environmental policy to be pursued by the state. The economic situation of the country at this period was characterized by the establishment of manufacturing and industrial firms especially in urbanizing areas, which began in the 1950s. 1.3 Period from 1972 to the present This period saw the emergence of organic laws that defined environmental management as a major policy of the state. The trend was caused by the 1972 Stockholm UN Conference on the Human Environment that brought to the attention of the global community the urgent need to incorporate environmental concerns in the overall concept of development. The laws promulgated from 1972-1986 comprise the main body of environmental laws that are being implemented. These include the Pollution Control Law (PD 984), Philippine Environmental Policy (PD 1151), Philippine Environment Code (PD 1152) and the establishment of the Environmental Impact Statement System (PD 1586). Laws pertaining to the natural resources sector promulgated during this period involve the streamlining of organizational structures and updating of existing laws, e.g., Forestry Reform Code (PD 389 as revised by PD 705), Mineral Resources Development Decree of 1974 (PD 463), among others. Alan S. Cajes 

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Policies on Energy Efficient and Environmentally Sound Technologies  2. Constitutional Framework The Philippine Constitution, being the fundamental law of the country, provides the framework for policy and lawmaking in the land. Its provisions highlight the national priorities and influence future legislative policies and executive decisions. In the area of environment, the following constitutional principles are applicable: (1) policy on environment, (2) policy on resource utilization, and (3) policy on due process and people participation. 2.1 Constitutional policy on environment The 1987 Philippine Constitution is definite about the importance of the people’s right to health and ecological security. The two provisions that directly address this concern are: • •

Art. II, Section 16: “That State shall protect and advance the right of the people to a balanced and healthful ecology in accord with the rhythm and harmony of nature.” Art. II, Section 15: “The State shall protect and promote the right to health of the people and instill health consciousness among them.”

In the case of Oposa vs. Factoran (The Children’s Case), the Supreme Court of the Philippines defined what is meant by the right to a balanced and healthful ecology. In defining the meaning of the phrase "rhythm and harmony of nature,” the Court said: Nature means the created world in its entirety. Such rhythm and harmony indispensably include, inter alia, the judicious disposition, utilization, management, renewal and conservation of the country’s forest, mineral, land, waters, fisheries, wildlife, off-shore areas and other natural resources to the end that their exploration, development and utilization be equitably accessible to the present as well as future generations. The Court also recognized the primacy and centrality of the right to ecological security and health among the many rights assured by the Constitution. It said that: While the right to a balanced and healthful ecology is to be found under the Declaration of Principles and State Policies and not under the Bill of Rights, it does not follow that it is less important than any of the civil and political rights enumerated in the latter. Such a right belongs to a different category of rights altogether for it concerns nothing less than selfpreservation and self-perpetuation – the advancement of which may even be said to predate all governments Alan S. Cajes 

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Policies on Energy Efficient and Environmentally Sound Technologies  and constitutions. As a matter of fact, these basic rights need not even be written in the Constitution for they are assumed to exist from the inception of mankind. If they are now explicitly mentioned in the fundamental charter, it is because of the well-founded fear of its framers that unless the rights to a balanced and healthful ecology and to health are mandated as state policies by the Constitution itself, thereby highlighting their continuing importance and imposing upon the state a solemn obligation to preserve the first and protect and advance the second, the day would not be too far when all else would be lost not only for the present generation, but also for those to come – generations which stand to inherit nothing but parched earth incapable of sustaining life. 2.2 Constitutional policy on resource utilization The Regalian Doctrine is the principal legal concept that the government relies upon to control the utilization and management of natural resources. It is premised on the notion that all natural resources in the territory belong to the State and therefore private ownership or title must come from the State. Hence the doctrine, according to the official view, states that all lands not covered by official documentary certificates of titles are presumed to be owned by the government. It states: “All lands of the public domain, waters, minerals, coal, petroleum, and other mineral oils, all forces of potential energy, fisheries, forests or timber, wildlife, flora and fauna, and other natural resources are owned by the State. With the exception of agricultural lands, all other natural resources shall not be alienated.” (Article XII, Section 2 of the 1987 Constitution) As regards the doctrine, Prof. La Vina opines: “On the basis of the Regalian Doctrine, the executive branch, through DENR, exercises an almost unrestrained control over land tenure decisions affecting millions of Filipinos living within the so-called public domain. This includes all forestlands. “Included also among lands of the public domain, because they are usually situated in upland forest zones, are those lands which have been occupied by indigenous cultural communities since time immemorial. By such inclusion, these timeAlan S. Cajes 

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Policies on Energy Efficient and Environmentally Sound Technologies  immemorial occupants have been effectively disenfranchised of their rights to their ancestral lands, resulting in their being categorized as squatters in their own lands. This injustice has been further institutionalized by Section 15 of the Revised Forestry Code (PD No. 705) which provides that no land of the public domain eighteen percent (18%) in slope or over shall be classified as alienable and disposable. Under this provision, majority of indigenous uplanders have become illegal occupants in their own lands, subject to criminal prosecution. “The propriety of using the Regalian Doctrine as the foundation of Philippine natural resource laws have been questioned by legal scholars. It has been pointed out that the doctrine is not only patently unjust but it is also legally and historically flawed. “While it was the principal weapon used by the two colonial masters of the Philippines, Spain and the United States, to consolidate their use and control of Philippines natural resources, political independence did not lead to the rejection of the Regalian Doctrine. Ironically, the same concept was enshrined in all postindependence constitutions of the Philippines, thus ensuring the systematic marginalization of many Filipino citizens. “From the point of view therefore of both equity and ecology, there is a need to rethink the application of the Regalian Doctrine to all natural resources particularly to ancestral lands in forest zones, and by analogy, to forest lands occupied and held by longterm migrants. The national government must be willing to yield both ownership and total control over at least some resources. This is imperative if indeed there is to be democratization of access to and management of forest resources. This is also an imperative demanded by the Constitution.” 2.3 Mode of utilizing natural resources Article XII, Section 2 of the Constitution also establishes the modes of utilizing natural resources. It states: “The exploration, development, and utilization of natural resources shall be under the full control and supervision of the State. The State may directly Alan S. Cajes 

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Policies on Energy Efficient and Environmentally Sound Technologies  undertake such activities, or it may enter into coproduction, joint venture, or production-sharing agreements with Filipino citizens, or corporation or associations at least sixty per centum of whose capital is owned by such citizens… The Congress may, by law, allow small-scale utilization of natural resources by Filipino citizens…” This enumeration is exclusive. Under the principle of inclusio unius est exclusio alterius, the Constitution, by enumerating the allowable modes of exploration, development and utilization, clearly intended to exclude all others which are not enumerated.3 2.4 Constitutional policy on due process and people participation The constitutional principles under this policy include the right to due process, the right to information, the right to just compensation, the rights of various sectors to participate in nation building, and the State policy of full disclosure. The Constitution provides the following: The right to due process Article III, Section 1: “No person shall be deprived of life, liberty, or property without due process of law, nor shall any person be denied the equal protection of the laws.” Article III, Section 9: “Private property shall not be taken for public use without just compensation.” The right to information Article III, Section 7: “The right of the people to information on matters of public concern shall be recognized. Access to official records and to documents and papers pertaining to official acts, transactions, or decisions as well as to government research data used as basis for policy development, shall be afforded the citizen, subject to such limitations as may be provided by law.” Article II, Section 24: “The State recognizes the vital role of communication and information in nation-building.” Article II, Section 28: “Subject to reasonable conditions prescribed by law, the State adopts and implements a policy of full disclosure of all its transactions involving public interest.”


R. P. Lotilla, “Developing the Law on Fisheries and Living Aquatic Resources,” 10:3 Phil. L. Gaz. 1,2 (1989) quoted in Antonio G. M. La Vina, Basic EIAME Course Module B: Natural Resource and Environmental Policy Framework (no date)

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Policies on Energy Efficient and Environmentally Sound Technologies  The right to people participation Article II, Section 13: “The State recognizes the vital role of the youth in nationbuilding…” Article II, Section 14: “The State recognizes the role of women in nation-building and shall ensure the fundamental equality before the law of women and men.” Article II, Section 18: “The State affirms labor as a primary social economic force..." Article II, Section 22: “The State recognizes and promotes the rights of indigenous cultural communities within the framework of national unity and development.” Article II, Section 23: “The State shall encourage non-governmental, communitybased or sectoral organizations that promote the welfare of the nation.” 3. Role of Local Government Units4 The Local Government Code of 1991 provides for the promotion of the autonomy of local government units (LGUs) to ensure their fullest development as self-reliant communities and make them more effective partners in the pursuit of national development and social progress. Such policy effectively places LGUs in the forefront of translating the national environment policy into actual practice. Under the Code, an LGU is defined as a “body politic and corporate endowed with powers to be exercised by it in conformity with law. As such, it shall exercise powers as a political subdivision of the national government and as a corporate entity representing the inhabitants of its territory." Its functions, among others, include the following: • • • • • • •

Ensure and support the preservation and enrichment of culture; Promote health and safety; Enhance the right of the people to a balanced ecology; Encourage and support the development of appropriate and self-reliant scientific and technological capabilities; Improve public morals; Enhance economic prosperity and social justice; Promote full employment among their residents;


In addition to their political duties and responsibilities, LGUs, as corporate entities, also have products (ordinances, programs, projects, etc.), services (primary health care, basic education, etc.) and activities (construction of roads, bridges and other infrastructure) that have significant impacts to the environment. As such, LGUs have corporate environmental responsibilities in terms of ensuring that the impacts of their operations will not cause significant negative changes to the quality and quantity of their environment. Thus, the environmental responsibilities of LGUs -- which are both to enforce and observe the environmental policies, laws, rules and regulations – necessarily places LGUs in the front line of environmental protection and enhancement.

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Maintain peace and order; Preserve the comfort and convenience of the inhabitants; Discharge the devolved functions and responsibilities of national agencies and offices, and Provide basic services and facilities. (Sections 16-17)

As a body politic, LGUs share with the national government, particularly the Department of Environment and Natural Resources (DENR), the responsibility of managing and developing the environment and natural resources within their territorial jurisdictions. Under Department Administrative Order No. 30, Series of 1992, which provides the guidelines for the transfer and implementation of DENR functions devolved to the LGUs, the devolved functions, programs and projects include the following: Forest management • • • •

Implementation of community-based projects Management and control of communal projects Management, protection, rehabilitation and maintenance of small watersheds Enforcement of forest laws in community-based forestry areas

Protected areas and wildlife • • •

Establishment, protection and maintenance of tree parks, green belts and other tourist attraction sin areas identified and delineated by DENR, except those covered by NIPAS Regulation of flora outside protected areas Implementation of rehabilitation in conservation hotspots (RICH) project and the conservation of rare and endangered species (CARE) project in areas identified and delineated by DENR

Environmental management • • • •

Enforcement of pollution control and environmental protection laws Implementation of solid waste disposal and other environmental management systems and services related to sanitation Abatement of noise and other nuisance as defined by law Implementation of cease and desist orders issued by the Pollution Adjudication Board

Mines and geo-sciences development, and • • •

Enforcement of the small-scale mining law Issuance of permit for guano collection and extraction of quarry resources Imposition and collection of fees and charges on quarry resources

Land management Alan S. Cajes 

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Involves the conduct of surveys (post-survey activities such as records keeping and issuance of patents are to be done by DENR)

Under RA No. 8749 or the Clean Air Act, including its implementing rules and regulations, LGUs have the following roles within their territorial jurisdiction: • • • • • • •

Share the responsibility of managing and maintaining air quality; Implement air quality standards; Establish an Environment and Natural resources Office (CENRO) in every province, city or municipality; Prepare and develop, with the assistance of DENR, an action plan consistent with the Integrated Air Quality Framework, to attain and maintain the ambient of air quality standards within their respective airsheds; Prepare and implement a program and other measures in relocation, whenever necessary, to protect the health and welfare of residents in the area; Develop and submit to DENR through EMB a procedure for carrying out the action plan for their jurisdiction5, and Perform such other powers and functions as may be provided by applicable laws, rules and regulations.

It may be recalled that in 1977, Pres. Marcos issued PD No. 1160, which vests authority in Barangay Captains to enforce pollution and environmental control laws. The law also deputizes the Barangay Captain, the Barangay Councilman, and the Barangay Zone Chairman as peace officers with authority to arrest violators in accordance to law, for purposes of enforcing and implementing national and local laws, ordinances, and rules and regulations governing pollution control and other activities that create imbalance in the ecology or disturbance in environmental conditions. 4. International Environmental Agreements6 International agreements and treaties, of which the Philippine government is a signatory, form part of the laws of the country. The significant international environmental agreements include the following: 4.1 Basel Convention on the Control of Transboundary Movement of Hazardous Wastes and their Disposal Adopted in 1989 and signed by the Philippines on the same year, this Convention reflects the international community's intent to control the movement and disposal of hazardous wastes at the international and national levels and to dispose such wastes in an "environmentally-sound manner." It not only prohibits the export and import of such wastes but also enjoins Parties to the Convention to reduce their generation to a minimum. The government's response 5

In this role, the DENR through EMB shall maintain its authority to independently inspect the enforcement procedure that is adopted. 6 See DENR-EMB, Philippine Environmental Quality Report, 1990-1995.

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Policies on Energy Efficient and Environmentally Sound Technologies  to the Convention is the passage of RA No. 6969 and its implementing rules and regulations. 4.2 The Global Framework Convention for the Protection of the Ozone Layer and the Montreal Protocol on Substances that Deplete the Ozone Layer This Convention requires the protection of human health and the environment from the effects of ozone depletion. Its offshoot, the Montreal Protocol, calls for 50% reduction in CFCs by the year 2000. It contains a comprehensive schedule for phasing out the production and consumption, as well as imposition of control measures on manufacturing and import of ozonedepleting chemicals. The Philippines signed the Protocol in 1988, ratified it in 1991, and responded by enacting RA No. 6969 and its implementing rules and regulations, among others. 4.3 United Nations Convention on Biological Diversity Background This Convention intends to ensure the effective international action to curb the destruction of biological species, habitats and ecosystems. The most important provisions of the Convention include the following: • • • • • • •

The requirement that countries adopt regulations to conserve their biological resources; The legal responsibility of Governments for the environmental impact in other countries of activities of their private corporations; Funding to assist developing countries in implementing the Convention to be administered through the Global Environment Facility, pending the establishment of a new institutional structure; The transfer of technology to developing countries on preferential intellectual property rights or patents; Regulation of biotechnology firms; Access to and ownership of genetic material, and Compensation to developing countries for extraction of their genetic materials.

The government's response to the Convention includes the promulgation of RA No. 7586 or the NIPAS Law, issuance of Executive Order No. 24, series of 1995 that prescribes the guidelines and establishes a regulatory framework for the prospecting of biological and genetic resources, their by-products and derivatives for scientific and commercial purposes, review of existing national laws on ecosystem management, and formulation of the Philippine Strategy for Biodiversity Conservation. 4.4 United Nations Framework Convention on Climate Change The Convention's ultimate goal is to stabilize the greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous anthropogenic interference with the climate system. This goal has to be achieved Alan S. Cajes 

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Policies on Energy Efficient and Environmentally Sound Technologies  within a timeframe to allow ecosystems to adapt naturally and to ensure that food production is not threatened. The Convention is based on the following principles: • • •

International equity - the climate system should be protected for the present and future generations; Common but differentiated responsibilities - recognizes the historical emissions and the economic conditions of developing countries, which make them more vulnerable to the impacts of climate change, and Precautionary principle - states that the lack of scientific evidence should not be the basis for delaying actions to prevent climate change.

The government ratified the Convention in 1994. Its initiatives, in response to the Convention, include researches, public awareness campaigns and policy formulation activities that are conducted by the government, private, and nongovernment sectors. An Interagency Committee on Climate Change (IACC) composed of 15 government agencies and NGO representatives. 4.5 Global Agenda 21 This document was adopted by various countries during the Earth Summit held in 1992. It spells out the common agenda to make development economically, socially and ecologically sustainable. In response to this, the government formulated the Philippine Agenda 21, which the Philippine Council for Sustainable Development is currently implementing and monitoring. 5. Statutory Environmental Policies On November 7, 1975, former President Ferdinand E. Marcos7 issued Presidential Decree (PD) No. 825, which provides penalty for the improper disposal of garbage and other forms of uncleanliness. The law was enacted in line with the government's principal aims of effecting social, economic and political reform through discipline and order. It is premised on the idea that a healthy citizenry is a vital factor in bringing about the said reform. Thus, it is the duty of every citizen and resident of the country to keep his/her environment clean and wholesome. Such duty involves the cleaning up of his surroundings, yards and gardens, as well as canals, roads or streets in his/her immediate premises. The law also provides that all garbage, filth and other waste matters shall be placed in the proper receptacles, which shall be disposed of by garbage collectors. Moreover, the law penalizes any person who shall litter or throw garbage, filth or other waste matters in public places.


In recognition of the important role of the State to protect and manage the environment, Pres. Marcos issued PD No. 461 in 1974 reorganizing the then Department of Agriculture and Natural Resources (DANR) into two departments, namely, the Department of Agriculture (DA), and the Department of Natural Resources (DNR).

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Policies on Energy Efficient and Environmentally Sound Technologies  In the same year, Pres. Marcos issued PD No. 856 of the Code of Sanitation. Like PD 825, it gives paramount importance to people's health, hence, all efforts of public services should be directed towards the protection and promotion of health. The law was also an attempt of the government to update and codify the scattered sanitary laws to ensure that they are in keeping with modern standards of sanitation. In this law, the concerned Department Secretary is authorized to promulgate rules and regulations for the control and prevention of the following types of pollution: • • • • • • •

Pollution of pesticides and heavy metals; Pollution of food caused by chemicals, biological agents, radioactive materials, and excessive or improper use of food and additives; Non-ionizing radiation caused by electronic products such as laser beams or microwaves; Noise pollution caused by industry, land and air transports and building construction; Biological pollutants including the causative agents of intestinal infections; Pollution of agricultural products through the use of chemical fertilizers and plant pesticides containing toxic chemical substances and unsanitary agricultural practices, and Any other type of pollution not covered by RA No. 3931, the rules and regulations of the National Water and Air Pollution Control Commission, PD No. 480, and the rules of the Radiation Health Office of the Department of Health.

The phrase "any other type of pollution" refers to pollution that affects the community health adversely. In 1976, Pres. Marcos issued PD No. 979, which revises PD No. 600 that governs marine pollution. PD No. 979 stresses that the marine environment and the living organisms it supports are of vital importance to humanity, and that all people have an interest in assuring that it is managed and protected in such a way that its quality is not impaired. It recognizes the capacity of the sea to assimilate wastes and render them harmless, as well as its limited ability to regenerate natural resources. It also presupposes that marine pollution comes from many sources such as rivers, estuaries, brooks or springs. PD No. 979 places responsibility on the state to control both public and private activities that cause damage to the marine environment by promoting the use of the best practicable means and by improved disposal processes to minimize harmful wastes. It declared as a national policy the prevention and control of pollution of seas due to dumping of wastes and other matter which create hazards to human health, harm living resources and marine life, damage amenities, or interfere with the legitimate uses of the sea within the State territory. It declares as unlawful for any person to commit the following: •

Discharge, dump, or suffer, permit the discharge of oil, noxious gaseous and liquid substances and other harmful substances from or out of any ship, vessel,

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barge, or any other floating craft, or other man-made structures at sea, by any method, means or manner, into or upon the territorial and inland navigable waters of the Philippines; Throw, discharge or deposit, dump, or cause, suffer or procure to be thrown, discharged, or deposited either from or out of any ship, barge, or other floating craft or vessel of any kind, or from the shore, wharf, manufacturing establishment, or mill of any kind, any refuse matter of any kind or description whatever other than that flowing from streets and sewers and passing therefrom in a liquid state into tributary of any navigable water from which the same shall float or be washed into such navigable water; and Deposit or cause, suffer or procure to be deposited material of any kind in any place on the bank of any navigable water, or on the bank of any tributary of any navigable water, where the same shall be liable to be washed into such navigable water, either by ordinary or high tides, or by storms or floods, or otherwise, whereby navigation shall or may be impeded or obstructed or increase the level of pollution of such water.

Another law enacted in 1976 is PD No. 1067 or the Water Code of the Philippines. This law prohibits and penalizes, among others, the following: • • • • • • • •

Dumping of mine tailings and sediments into rivers and waterways without permission from the government; Appropriation of subterranean or ground water for domestic use without proper registration required by government; Non-observance of any standards of beneficial use of water Failure of the appropriators to keep a record of water withdrawal when required; Failure to comply with any of the terms or conditions in a water permit or a water rights grant; Unauthorized use of water for a purpose other than that for which a right was granted; Construction or repair of any hydraulic work or structure without duly approved plans and specifications, when required, and Failure to install a regulating and measuring device for the control volume of water appropriated, when required.

In the same year, Pres. Marcos issued another important piece of legislation: PD No. 984 or the National Pollution Control of 19768. It declares as a national policy to prevent, abate, and control the pollution of water, air and land for the more effective utilization of the country's resources. The law prohibits the throwing, draining or dispersing into any water, air or land resource, or causing, permitting, suffering to be thrown, running, draining, allowing to seep or disposing thereto of any organic or inorganic matter or any substance in gaseous or liquid form that shall cause pollution thereof.


Regulations on industrial and municipal wastewater effluents are embodied in Department Administrative Order (DAO) No. 35 or the Revised Effluent Regulations of 1990.

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Policies on Energy Efficient and Environmentally Sound Technologies  The following year, 1977, the statutory policy on environment was promulgated under PD No. 1151 or the Philippine Environmental Policy. This law recognizes the piecemeal approach to environmental protection in use at that time and declares such approach as a "tunnel-vision concept" that is not conducive to attain an ideal environmental situation where man and nature can thrive in harmony with one another. In response to this, the government found it urgent to formulate an intensive and integrated program of environmental protection that will bring about a concerted effort in protecting the whole spectrum of the environment through the conduct of environmental impact assessment (EIA) and the submission of environmental impacts statements (EISs). As a matter of policy, the law states that it is the continuing policy of the State to • • •

Create, develop, maintain and improve conditions under which man and nature can thrive in productive and enjoyable harmony with each other; Fulfill the social, economic and other requirements of present and future generations of Filipinos, and Ensure the attainment of en environment quality that is conducive to a life of dignity and well being.

In pursuing the above policy, the government, under Section 2 of the above-cited decree, is given the responsibility to use all practicable means, consistent with other essential considerations of national policy, in promoting the general welfare to the end that the country may: • • • • • •

Recognize, discharge, and fulfill the responsibilities of each generation as trustee and guardian of the environment for succeeding generations; Assure the people of a safe, decent, healthful, productive and aesthetic environment; Encourage the widest exploitation of the environment without degrading it, or endangering human life, health and safety or creating conditions adverse to agriculture, commerce and industry; Preserve important historic and cultural aspects of the Philippine heritage; Attain a rational and orderly balance between population and resource use, and Improve the utilization of renewable and non-renewable resources.

The law, which also recognizes the right of the people to a healthy environment and provides that it is the duty and responsibility of each individual to contribute to the preservation and enhancement of the country's environment, also requires all agencies and instrumentalities of the national government, including government-owned or controlled corporations, as well as private corporations, firms and entities to prepare, file and include in every action, project or undertaking, which significantly affects the quality of the environment, a detailed statement on: •

The environmental impact of the proposed action, project or undertaking;

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Policies on Energy Efficient and Environmentally Sound Technologies  • • • •

Any adverse environmental effect which cannot be avoided should the proposal be implemented; Alternative to the proposed action; A determination that the short-term uses of the resources of the environment are consistent with the maintenance and enhancement of the long-term productivity of the same, and Whenever a proposal involves the use of depletable or nonrenewable resources, a finding must be made that such use and commitment are warranted.

In the same year (1977), PD No. 1198 was enacted to require all those engaged in the exploration, development, and exploitation of natural resources or in the construction of infrastructure projects to restore or rehabilitate the affected areas back to their original condition. The basis of this law is the policy of the State to create, develop, maintain, and improve conditions under which man ca be most productive and to ensure an environmental quality that enhances human dignity and well being. Specifically, the law provides that all "individuals, partnerships or corporations engaged in the exploitation of natural resources like those engaged in mining, quarrying, or construction of dams, irrigation systems, roads and bridges and other infrastructure projects, as well as those engaged in similar or related operations or activities, shall, to the fullest extent possible, restore, rehabilitate and return the lands, rivers, and the natural environment subject thereof or affected thereby to their original condition as of before such operations or activities." On June 6, 1978, PD No. 1152 or the Philippine Environment Code was enacted to establish specific policies and prescribe environmental quality standards in a Code. This law complements PD No. 1121, which creates the National Environmental Protection Council (NEPC), by launching a comprehensive program of environmental protection and management. In terms of land use management, the Code aims to provide a rational, orderly and efficient acquisition, utilization and disposition of land and its resources to derive thereby maximum benefits. Another goal is to encourage the prudent use and conservation of land resources to prevent an imbalance between the nation's needs and such resources. An important provision of this law states that in "the location of industries, factories, plants, depots and similar industrial establishment, the regulating or enforcing agencies of the government shall take into consideration the social, economic, geographic and significant environmental impact of said establishments." In the same year, PD No. 1586 was passed following the provisions of PD No. 1151. This law establishes an environmental impact statement (EIS) system and other environmental management related measures. Its goal is to balance the exigencies of socio-economic undertakings with the requirements of environmental quality. Thus, the law declares it as a State policy to attain and maintain a rational and orderly balance between socio-economic growth and environmental protection. Specifically, the law provides the establishment of an EIS system founded Alan S. Cajes 

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Policies on Energy Efficient and Environmentally Sound Technologies  and based on the environmental impact statement required, under Section 4 of Presidential Decree No. 1151, of all agencies and instrumentalities of the national government, including government-owned or controlled corporations, as well as private corporations, firms and entities, for every proposed project and undertaking which significantly affect the quality of the environment. Other salient provisions of this law include the following: • •

The President of the Philippines may, on his own initiative or upon recommendation of NEPC, by proclamation declare certain projects, undertakings or areas in the country as environmentally critical; No person, partnership or corporation shall undertake or operate any such declared environmentally critical project or area without first securing an Environmental Compliance Certificate issued by the President or his duly authorized representatives; The Ministry of Human Settlements shall: a) Prepare the proper land or water use pattern for said critical project(s) or area(s); b) Establish ambient environmental quality standards; c) Develop a program of environmental enhancement or protective measures against calamitous factors such as earthquake, floods, water erosion and others, and d) Perform such other functions as may be directed by the President from time to time9

• •

All other projects, undertakings and areas not declared by the President as environmentally critical shall be considered as non-critical and shall not be required to submit an environmental impact statement… (But) may however require non-critical projects and undertakings to provide additional environmental safeguards as it may deem necessary. The NEPC shall issue the necessary rules and regulations to implement this Decree. Any person, corporation or partnership found violating Section 4 of this Decree, or the terms and conditions in the issuance of the Environmental Compliance Certificate (ECC), or of the standards, rules and regulations issued by the NEPC pursuant to this Decree shall be punished by the suspension or cancellation of his/its certificate and/or a fine in an amount not to exceed Fifty Thousand Pesos (P50,000.000) for every violation thereof, at the discretion of the NEPC. Proceeds from the penalties prescribed in the preceding Section 9 and other penalties imposed by the National Pollution Control Commission (NPCC) as authorized in P.D. 984, shall be automatically appropriated into an Environment Revolving Fund hereby created as an exemption to P.D. 711 and P.D. 1234. The fund shall be used exclusively for the operation of the NEPC


These functions are now performed by the Department of Environment and Natural Resources (DENR) through the Environmental Management Bureau (EMB). The EMB is now exercising the power and performing the functions of NEPC and NPCC.

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Policies on Energy Efficient and Environmentally Sound Technologies  and the NPCC in the implementation of this Decree. The rules and regulations for the utilization of this fund shall be formulated by the Ministry of Human Settlements and submitted to the President for approval. In relation to PD 1586, Pres. Marcos issued Proclamation No. 2146 on December 14, 1981 proclaiming certain areas and types of projects as environmentally critical and within the scope of the EIS system. The environmentally critical projects (ECPs) include the following: • • •

Heavy industries such as non-ferrous metal industries, iron and steel mills, smelting plants, petroleum and petro-chemical industries; Resource extractive industries such as major mining and quarrying projects, forestry projects, dikes for/and fishpond development projects, and Infrastructure projects such as major dams, major roads and bridges, major power plants, major reclamation projects, major ports and harbors, waste disposal facilities, major flood control projects, etc. The environmentally critical areas (ECAs) cover the following:

All areas declared by law as national parks, watershed reserves, wildlife preserves and sanctuaries • Areas set aside as potential tourist spots • Areas which constitute the habitat for any endangered or threatened species of indigenous Philippine wildlife • Areas of unique historical, archaeological or scientific interest • Areas which are traditionally occupied by cultural communities or tribes • Areas frequently visited or hard-hit by natural calamities • Areas with critical slopes • Areas classified as prime agricultural lands • Recharged areas of aquifers • Water bodies characterized by one or any combination of the following conditions: tapped for domestic purposes, within the controlled or protected areas declared by appropriate authorities, and support wildlife and fishery activities • Mangrove areas characterized by one or any combination of the following conditions: with primary and pristine and dense young growth, adjoining mouth of major river systems, near or adjacent to traditional productive fry or fishing grounds, act as natural buffers against shore erosion, strong winds and storm floods, and on which people are dependent for their livelihood, and • Coral reefs During the administration of Pres. Corazon C. Aquino, Executive Order (EO) No. 192 was issued to reorganize the Department of Natural Resources, which Pres. Marcos created from the Department of Agriculture and Natural Resources, into the Department of Environment and Natural Resources (DENR). The policy of the Aquino administration, as embodied in the said Executive Order, is to give equal Alan S. Cajes 

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Policies on Energy Efficient and Environmentally Sound Technologies  attention to the environment and natural resources development. The aim of this policy is to ensure the sustainable use, development, management, renewal, and conservation of the country's forest, mineral land, off-shore areas, and other natural resources, including the protection and enhancement of environmental quality. One of the important environmental laws passed during the administration of Pres. Aquino is RA No. 6969 or the law controlling toxic substances and hazardous and nuclear wastes. The policy under this law seeks to: • • •

Regulate, restrict or prohibit the importation, manufacture, processing, sale, distribution, use and disposal of chemical substances and mixtures that present unreasonable risk and/or injury to health or the environment; Prohibit the entry, even in transit, of hazardous and nuclear wastes and their disposal into the Philippine territorial limits for whatever purpose, and Provide advancement and facilitate research and studies on toxic chemicals

The law covers the importation, manufacture, processing, handling, storage, transportation, sale, distribution, use and disposal of all unregulated chemical substances and mixtures in the Philippines, including the entry, even in transit, as well as the keeping or storage and disposal of hazardous and nuclear wastes into the country for whatever purpose. Its objectives are as follows: •

• •

To keep an inventory of chemicals that are presently being imported, manufactures, or used, indicating, among others, their existing and possible uses, test data, names of firms manufacturing or using them, and such other information as may be considered relevant to the protection of health and the environment; To monitor and regulate the importation, manufacture, processing, handling, storage, transportation, sales, distribution, use and disposal of chemical substances and mixtures that present unreasonable risk or injury to health or to the environment in accordance with national policies and international commitments; To inform and educate the populace regarding the hazards and risks attending to the manufacture, handling, storage, transportation, processing, distribution, use and disposal of toxic chemicals and other substances and mixtures, and To prevent the entry, even in transit, as well as the keeping or storage and disposal of hazardous and nuclear wastes into the country for whatever purpose.

In 1992, the implementing rules and regulations of RA 6969 were promulgated. The year 1992 also saw the passage of RA No. 7586, which provides for the establishment and management of the National Integrated Protected Areas System (NIPAS). The policies under this law include the following: •

Secure for the people of both present and future generations the perpetual existence of all native plants and animals through the establishment of a

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• • •

comprehensive system of integrated protected areas within the classification of a natural park; Recognize such areas as possessing common ecological values, despite their distinct features, that may be incorporated into a holistic plan that is representative of the natural heritage; Recognize that the effective management of such areas is possible only through cooperation among national government, local government, and concerned private organizations, and Recognize that the use and enjoyment of such protected areas must be consistent with the principles of biological diversity and sustainable development.

The NIPAS encompasses the remarkable areas and biologically important public lands that are habitats of rare and endangered species of plants and animals, biogeographic zones, and related ecosystems, whether terrestrial, wetland or marine. RA No. 7611 or the Strategic Environmental Plan for Palawan was likewise enacted in 1992. This law places responsibility on the State to: •

Protect, develop and conserve its natural resources. Towards this end, the State shall assist and support the implementation of plans, programs and projects formulated to preserve and enhance the environment, and at the same time pursue the socioeconomic development goals of the country. Support and promote the sustainable development goals for the provinces through proper conservation, utilization and development of natural resources to provide optimum yields on a continuing basis. With specific reference to forest resources, the State shall pursue and implement forest conservation and protection through the imposition of a total commercial logging ban. Adopt the necessary measures leading to the creation of an institutional machinery including, among others, fiscal and financial programs to ensure the effective and efficient implementation of environmental plans, programs and projects. Promote and encourage the involvement of all sectors of society and maximize people participation in natural resource management, conservation and protection.

In 1995, RA No. 7942 or the Philippine Mining Act was passed. The law declares all mineral resources within the territory and exclusive economic zone of the country as owned by the State following the Regalian Doctrine of the Philippine Constitution. Consequently, the State has the responsibility to promote their rational exploration, development, utilization and conservation through the combined efforts of government and the private sector in order to enhance national growth in a way that effectively safeguards the environment and protect the rights of affected communities. Among the salient provisions of the law are the following: •

Prohibiting the applications of mineral agreement or financial or technical assistance in areas such as those that are (a) near waterways, reservoirs, etc.

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except upon written consent by the party concerned, (b) in areas covered by small-scale miners unless there is prior consent by them, (c) in old growth or virgin forests, proclaimed watershed forest reserves, wilderness areas, mangrove forests, parks, greenbelts, game refuge and bird sanctuaries, and in areas prohibited by law, etc. Requiring proponents to effectively use appropriate anti-pollution technology and facilities to protect the environment and to restore or rehabilitate mined out areas and other areas affected by mine tailings and other forms of pollution or destruction. Requiring every contractor to undertake an environmental protection and enhancement program covering the period of the mineral agreement or permit. Such environmental program shall be incorporated in the work program which the contractor or permittee shall submit as an accompanying document to the application for a mineral agreement or permit. The work program shall include not only plans relative to mining operations but also to rehabilitation, regeneration, revegetation and reforestation of mineralized areas, slope stabilization of mined-out and tailings covered areas, aquaculture, watershed development and water conservation, and socioeconomic development. Requiring the issuance of an ECC based on the Philippine Environmental Impact Assessment System including Sections 26 and 27 of the Local Government Code of 1991 which require national government agencies to maintain ecological balance, and prior consultation with the local government units, non-governmental and people’s organizations and other concerned sectors of the community. A completed ecological profile of the proposed mining area shall also constitute part of the EIA. Also, people’s organizations and non-governmental organizations (NGOs) shall be allowed and encouraged to participate in ensuring that contractors/permittees shall observe all the requirements of environmental protection. Requiring the technical and biological rehabilitation of the excavated, minedout, tailings covered and disturbed areas to the condition of environmental safety, as may be required. In this connection, a mine rehabilitation fund shall be created, based on the contractor’s approved work program, and shall be deposited as a trust fund in a government depository bank and used for physical and social rehabilitation of areas and communities affected by mining activities and for research on the social, technical and preventive aspects of rehabilitation. Failure to fulfill the above obligation shall mean immediate suspension or closure of the mining activities of the contractor/permittee concerned.

In 1997, RA No. 8435 or the Agriculture and Fisheries Modernization Act was passed. The policies under this law include the following: •

Promote more equitable distribution of opportunities, income and wealth, sustained increase in the amount of goods and services produced by the nation for the benefit of the people, and an expanding productivity as the key to raising the quality of life for all, especially the underprivileged.

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Policies on Energy Efficient and Environmentally Sound Technologies  •

• •

Promote industrialization and full employment based on sound agricultural development and agrarian reform, through industries that make full and efficient use of human and natural resources, and which are competitive in both domestic and foreign markets. In pursuit of these goals, all sectors of the economy and all regions of the country shall be given optimum opportunity to develop. Private enterprises, including corporations, cooperatives, and similar collective organizations, shall be encouraged to broaden the base of their ownership. Enable those who belong to the agriculture and fisheries sectors to participate and share in the fruits of development and growth in a manner that utilizes the nations resources in the most efficient and sustainable way possible by establishing a more equitable access to assets, income, basic and support services and infrastructure. Promote food security, including sufficiency in our staple food, namely rice and white corn. The production of rice and white corn shall be optimized to meet our local consumption and shall be given adequate support by the State. Adopt the market approach in assisting the agriculture and fisheries sectors while recognizing the contribution of the said sector to food security, environmental protection, and balanced urban and rural development, without neglecting the welfare of the consumers, especially the lower income groups. The state shall promote market-oriented policies in agricultural production to encourage farmers to shift to more profitable crops. Empower the agricultural and fisheries sector to develop and sustain them. RA No. 8435 operates on the basis of the following principles:

• •

• •

Poverty Alleviation and Social Equity - The State shall ensure that the poorer sectors of society have equitable access to resources, income opportunities, basic and support services and infrastructure especially in areas where productivity is low as a means of improving their quality of life compared with other sectors of society; Food Security - The State shall assure the availability, adequacy, accessibility of food supplies to all at all times; Rational Use of Resources - The State shall adopt a rational approach in the allocation of public investments in agriculture and fisheries in order to assure efficiency and effectiveness in the use of scarce resources and thus obtain optimal returns on its investments; Global Competitiveness - The State shall enhance the competitiveness of the agriculture and fisheries sectors in both domestic and foreign markets; Sustainable Development - The State shall promote development that is compatible with the preservation of the ecosystem in areas where agriculture and fisheries activities are carried out. The State should exert care and judicious use of the country's natural resources in order to attain long-term sustainability; People Empowerment - The State shall promote people empowerment by enabling all citizens through direct participation or through their duly elected, chosen or designated representatives the opportunity to participate in policy

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formulation and decision-making by establishing the appropriate mechanisms and by giving them access to information; and Protection from Unfair Competition - The State shall protect small farmers and fisher folk from unfair competition such as monopolistic and oligopolistic practices by promoting a policy environment that provides them priority access to credit and strengthened cooperative-based marketing system. In terms of objectives, the law seeks to achieve the following:

• •

• •

• •

• •

Modernize the agriculture and fisheries sectors by transforming these sectors from a resource-based to a technology-based industry; Enhance profits and incomes in the agriculture and fisheries sectors, particularly the small farmers and fisherfolk, by ensuring equitable access to assets, resources and services, and promoting higher-value crops, value-added processing, agribusiness activities, and agro-industrialization; Ensure the accessibility, availability and stable supply of food to all at all times; Encourage horizontal and vertical integration, consolidation and expansion of agriculture and fisheries activities, group functions and other services through the organization of cooperatives, farmers' and fisherfolk's associations, corporations, nucleus estates, and consolidated farms and to enable these entities to benefit from economies of scale, afford them a stronger negotiating position, pursue more focused, efficient and appropriate research and development efforts and enable them to hire professional managers; Promote people empowerment by strengthening people's organizations, cooperatives and NGOs and by establishing and improving mechanisms and resources for their participation in government decision-making and implementation; Pursue a market-driven approach to enhance the comparative advantage of our agriculture and fisheries sectors in the world market; Induce the agriculture and fisheries sectors to ascend continuously the valueadded ladder by subjecting their traditional or new products to further processing in order to minimize the marketing of raw, unfinished or unprocessed products; Adopt policies that will promote industry dispersal and rural industrialization by providing incentives to local and foreign investors to establish industries that have backward linkages to the country's agriculture and fisheries resource base; Provide social and economic adjustment measures that increase productivity and improve market efficiency while ensuring the protection and preservation of the environment and equity for small farmers and fisherfolk; and Improve the quality of life of all sectors. Another important law, which the Philippine Congress enacted in 1997, is RA No. 8731 or the Indigenous People's Rights Act. The policy under this law requires the State to recognize and promote all the rights of Indigenous Cultural Communities/Indigenous Peoples (ICCs/IPs) such as the following:

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• • • •

Rights of ICCs/IPs to their ancestral domains to ensure their economic, social and cultural well being and shall recognize the applicability of customary laws governing property rights or relations in determining the ownership and extent of ancestral domain; Rights of ICCs/IPs to preserve and develop their cultures, traditions and institutions. It shall consider these rights in the formulation of national laws and policies; Rights of ICCs/IPs regardless of sex to equally enjoy the full measure of human rights and freedoms without distinctions or discriminations; Rights of ICCs/IPs to their cultural integrity, and to benefit on an equal footing from the rights and opportunities which national laws and regulations grant to other members of the population, and Rights of ICCs/IPs to maximum participation in the direction of education, health, as well as other services, to render such services more responsive to the needs and desires of these communities. The passage of RA No. 8731 is significant considering that among the proposals of the participants to the 1997 Philippine Livelihood and SME World Congress held in Manila is the protection of ancestral domain and lands through a moratorium on issuances of licenses and permits. The other proposals ask LGUs to declare the municipal waters for the exclusive use of marginalized fisherfolk using non-destructive fishing gears, and ensure the strict enforcement of laws against piracy and poaching of small vessels in territorial waters. The SME concerns that surfaced during the activity are as follows:

• • • •

Protecting the rights of fisherfolk; Protecting and recognizing the rights of indigenous people to their ancestral domain; Capability building for LGUs in disaster preparedness and management of calamity funds, and Enactment of a land use policy The year 1999 saw the passage of the landmark but controversial law, RA No. 8749 or the Philippine Clean Air Act. The law hinges on the following principles:

• • • • •

Protection and advancement of the people's right to a balanced and healthful ecology in accord with the rhythm and harmony of nature; Promotion and protection of the global environment to attain sustainable development while recognizing the primary responsibility of LGUs to deal with environmental problems; Recognition that the responsibility of cleaning the habitat and environment is primarily area-based; Recognition of the principle that “polluters must pay” for the cost of pollution, and Recognition that a clean and healthy environment is for the good of all and should, therefore, be the concern of all.

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Policies on Energy Efficient and Environmentally Sound Technologies  The policies under this law are as follows: • • • • • •

Pursue the balancing of development and environmental protection through sustainable development; Formulate a holistic national program of air pollution management that shall be implemented by the government through proper delegation and effective coordination of functions and activities; Encourage cooperation and self-regulation among citizens and industries through the application of market-based instruments; Focus primarily on pollution prevention rather than on control and provide for a comprehensive management program for air pollution; Promote public information and education and to encourage the participation of an informed and active public in air quality planning and monitoring; and Formulate and enforce a system of accountability for short and long-term adverse environmental impact of a project, program or activity. This shall include the setting up of a funding or guarantee mechanism for clean-up and environmental rehabilitation and compensation for personal damages. The law also recognizes the following rights of the citizens, which the State shall guarantee:

• • • • •

• •

The right to breathe clean air; The right to utilize and enjoy all natural resources according to the principles of sustainable development; The right to participate in the formulation, planning, implementation and monitoring of environmental policies and programs and in the decisionmaking process; The right to participate in the decision-making process concerning development policies, plans and programs projects or activities that may have adverse impact on the environment and public health; The right to be informed of the nature and extent of the potential hazard of any activity, undertaking or project and to be served timely notice of any significant rise in the level of pollution and the accidental or deliberate release into the atmosphere of harmful or hazardous substances; The right of access to public records which a citizen may need to exercise his or her rights effectively under this Act; The right to bring action in court or quasi-judicial bodies to enjoin all activities in violation of environmental laws and regulations, to compel the rehabilitation and cleanup of affected area, and to seek the imposition of penal sanctions against violators of environmental laws; and The right to bring action in court for compensation of personal damages resulting from the adverse environmental and public health impact of a project or activity. The implementing rules and regulations of RA No. 8749, which was promulgated in 2000, establishes the national air quality guidelines and provides for the maintenance of attainment areas and management of nonattainment areas, air quality management system, air pollution clearances and

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Policies on Energy Efficient and Environmentally Sound Technologies  permits for stationary sources, standards for pollution from stationary and other sources, among others. Its salient provisions include the following: • •

• • • •

• •

Sources not in compliance with the standards in attainment areas must submit a compliance plan to EMB for approval. The plan shall detail how the source can comply with the standards. New or modified sources in attainment areas are required, among others, to install and operate best available control technology for each regulated pollutant that has the potential to be emitted in quantities equal to or greater than 100 tons per year. New or modified sources in attainment areas shall install and operate, according to manufacturer specifications, continuous emission monitoring systems (CEMS) for each pollutant, as listed in Section 4, Rule IX, that has the potential to be emitted in quantities equal to or greater than 100 tons per year. Existing sources in non-attainment areas not in compliance to the standards must submit a compliance plan, which details how the source can be brought to compliance, to EMB. New or modified sources in non-attainment areas shall install and operate air pollution control technology that will provide the lowest achievable emission rate (LAER) of the pollutant. New of modified sources in non-attainment areas must install and operate, according to manufacturer specifications, continuous emission monitoring devices for each covered pollutant. Establishment of an Air Quality Management Fund to finance the containment, removal, and clean up operations of the government in air pollution cases, guarantee the restoration of ecosystems and rehabilitation of areas affected by the acts of violators, to support research, enforcement and monitoring activities and capability building of the relevant agencies, including the provision of technical assistance to the relevant agencies. Requiring project proponents to put up financial guarantee mechanisms to finance the needs of emergency response, clean up or rehabilitation of areas that may be damages during the program or actual project implementation. This will be made part of the environmental management plan required under the EIS system. The financial liability instruments may be in the form of trust fund, environmental insurance, surety bonds, letters of credit, as well as selfinsurance. Providing incentives to industries that install control devices or retrofit their existing facilities with mechanisms that reduce pollution. Incentives shall include tax credits and/or accelerated depreciation deductions, among others. Requiring the owner or operator of an industrial plant or stationary source to conduct its operation or process using the best practicable means, as may be necessary, to prevent or minimize air pollution through the employment if cleaner production and sound environmental management practices. This requirement applies when no emission or ambient standards is prescribed for a specific air pollutant that is potentially harmful to public health or public welfare.

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Policies on Energy Efficient and Environmentally Sound Technologies  • •

• •

• • •

Requiring each existing stationary source to submit to the EMB Regional Office in the region where the facility is located a self-monitoring report of its emission rates, indicating the status of compliance to the standards. Requiring the submission of proof of an approved environmental management system (EMS) in the form of an EMS audit report prepared by the person or party responsible for the facility or an EMS audit report prepared by a third party EMS auditor. Prohibiting any person from causing, letting, or allowing the emission of a particulate matter from any source whatsoever without taking reasonable precautions to prevent such emission. Prohibiting any person from storing, pumping, handling, processing, unloading or using in any process or installation any volatile compound or organic solvent without applying known existing vapor emission control devices or systems deemed necessary and approved by DENR through EMB. Prohibiting any person from discharging from any source whatsoever such quantities of air contaminants or other material which constitute nuisance under Articles 694 to 707 of RA No. 385 or the Civil Code of the Philippines. Prohibiting any person from burning any material in any quantity, which results in the emission of toxic and poisonous fumes. Prohibiting any establishment, firm, company, either government or private entity or organization, from burning or causing open burning of waste materials in their premises, areas of jurisdiction, including recognized or unrecognized dumpsites, in any quantity or quality. Prohibiting any incineration, which is defined as the burning of municipal, biomedical and hazardous wastes, whose process emits toxic and poisonous fumes10.


This prohibition does not apply to traditional small-scale method of community or neighborhood sanitation "siga", traditional, agricultural, health, food preparation, and crematoria. The rules and regulations also provide that existing incinerators shall be phased out on or before 17 July 2003, subject to certain conditions.

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Chapter III Energy Policies Related to E3ST


"The bottom line is that a sustainable economy would need to be at least three times as energy-efficient as today’s industrial economies typically are." - Lester Brown

1. Introduction As defined by law, energy resource means any substance or phenomenon which by itself or in combination with others, or after processing or refining, or the application to it of technology, emanates, generates or causes the emanation or generation of energy such as, but not limited to, petroleum or petroleum products, coal, marsh gas, geothermal and hydroelectric sources of energy, uranium and other similar radioactive minerals, solar energy, tidal power, as well as non-conventional, existing and potential sources.2 Minerals, on the other hand, are defined as any valuable inert or lifeless substance formed or deposited in its present position through natural agencies alone, and which is found either in or upon the soil of the earth or in the rocks beneath the soil.3 In the Philippines, energy resources are classified into indigenous and imported resources. Indigenous resources consist of conventional and nonconventional sub-classes. The indigenous conventional energy sources such as oil, coal, hydropower and geothermal supplied 22% of energy demands in 1989. Indigenous non-conventional energy resources consisting of bagasse, coconut husk/shell, rice husk, woodwaste and others supplied 13.1% of the total energy consumption in the same year.4 Because the country has bountiful mineral resources, the past administrations have been seeking opportunities to taps such resources. According to Antonio Oposa, one of the country's top environment lawyers: "Realizing the wealth of the country's mineral resources, the historic emphasis of governmental policy was on the exploration, exploitation and development of these resources. Thus, the bulk of early laws focused on mining claims and rights, administrative procedures for the exploitation of minerals and the promotion of the exploitation thereof. Little thought, if at 1

See Antonio A. Oposa Jr., Energy and Mineral Resources in Environmental Law in the Philippines, 1992 2 Black's Law Dictionary 1146 (1957 ed.), cited by Oposa 3 Com. Act. No. 137 (1936), sec. 7, cited by Oposa 4 Ibid.

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Policies on Energy Efficient and Environmentally Sound Technologies  all, was given to the environmental impact of this policy... Lately, there has been more emphasis on the conservation and judicious use of energy and mineral resources."5 Lately, however, the government's energy program rests on the following avowed policies: • • • • •

Promotion of self-reliance and minimization of dependence on outside sources of energy supply; Rationalization of energy prices to reflect the true costs of production and distribution; Encouragement of energy conservation measures to promote efficiency; Participation of the private sector in energy projects, and Maintenance of environmental and safety measures for energy projects

Such shift in policy, says Oposa, is "significant if only because it marks the realization of the finite character of the available resources and the need to sustain the development and utilization of the same."6 The foundation of "all energy laws in the country is that all natural resources are owned by the State which has full and absolute control of its exploration, development and utilization."7 The Philippine Constitution clearly spells out this policy saying: "All lands of the of the public domain, waters, minerals, coal, petroleum, and other mineral oils, all forces of potential energy, fisheries, forests or timber, wildlife, flora and fauna, are owned by the State. With the exception of agricultural lands, all other natural resources shall not be alienated. The exploration, development and utilization of natural resources shall be under the full control and supervision of the State. The State may directly undertake such activities, or it may enter into co-production, joint venture, or production sharing agreements with Filipino citizens. Such agreements may be for the period not exceeding twenty-five years, renewable for not more than twenty-five years and under such terms and conditions as may be provided by law. In cases of water rights for irrigation, water supply, fisheries, or industrial uses other than development of water power, beneficial use may be the measure and limit of the grant."8


Ibid., 228 Ibid., 229 7 Ibid., 229 8 Philippine Constitution, Art. XII, sec. 2. 6

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Policies on Energy Efficient and Environmentally Sound Technologies  2. Background of Energy-Related Policies and Laws In 1936, two energy-related laws were passed. The first law is Commonwealth Act No. 120 that created the National Power Corporation (NPC) and mandated it to undertake the development of hydraulic power and the production of power from other sources. The second law is the Mining Act, which regulated the conservation, disposition and development of mineral lands and minerals, as well as the licensing, leasing and granting of concessions for the exploitation, development and utilization of mineral oils and gas. Section 103 of the Mining Act penalizes "any person who willfully, and maliciously causes of permits sludge or tailings to accumulate in, or flow from his mining claims so as to cause danger, injury, or obstruction to any public road, rivers, streams or other public property." In 1949, Republic Act No. 387 or the Petroleum Act was passed to promote the exploration, development, exploitation and utilization of petroleum resources of the country and to encourage the conservation of such resources by way of the concession system. Oposa, however, observed that no significant petroleum exploration activity was conducted as a result of this law as the concession system "encouraged the prevalence of adverse legal technical and psychological factors that conspired to downgrade Philippine petroleum prospects and opportunities."9 1967 saw the passage of Republic Act No. 5092, which aimed to promote and regulate the exploration, development, exploitation, and utilization of geothermal energy, natural gas and methane gas. The law gave the Director of Mines the responsibility to prescribe rules and regulations to include, among others, the prevention and abatement of nuisances in or about bores and industries using geothermal energy, natural gas and methane gas. This law was later amended on June 11, 1978 by Presidential Decree No. 1142 that allowed the conversion of geothermal exploration permits and leases into service contracts to accelerate the development of geothermal resources. The other early laws enacted by the State include the following: • • •


Republic Act No. 5207 (1968) - enacted to license and regulate atomic energy facilities and establish the rules on nuclear damage in case of an accident. RA No. 6038 (1969) - gave way for the electrification of the country on an area coverage basis. Electric cooperatives were then set up nationwide under the supervision of the National Electrification Administration. PD No. 8 (1972) - abolished the concession system and replaced it with the scheme of a service contract. This was superseded by PD No. 87 (1972) which aimed to attract foreign investment in the venture. Oposa noted that "to accomplish the avowed policy of accelerating the exploration and

Oposa p. 230

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development of petroleum resources, the law granted generous tax, capital repatriation and other incentives."10 PD No. 334 (1973) - created the Philippine National oil Company (PNOC) to allow the government to take a more active role in assuring the adequate supply of oil and promote the accelerated exploration and development of local oil and petroleum sources. PD No. 334 was subsequently amended by the government. PD No. 572 (1976), for instance, expanded the powers of the PNOC to explore, discover, development, and extract all forms of energy resources such as oil, coal, marsh gas, methane gas, geothermal sources of heat and power, uranium, and other minerals and fossil deposits. According to Oposa, PD No. 572 in effect "removed from the National Power Corporation and responsibility of the exploration of energy resources (sic), with the exception of hydropower, and vested the same solely upon the PNOC. At present, the NPC is the entity responsible for the country's power generation."11 PD No. 292 (1977 coal energy development program) - enacted to promote and develop the necessary financial capability and undertake a scheme for the effective exploration and exploitation of coal reserves.

In the 70s, with the global concern over the depletion of resources and the degradation of human environments, the Philippines passed PD No. 1151 or the Philippine Environment Policy, and PD No. 1152: Philippine Environment Code. The Environment Code "mandates that rules and regulations shall be promulgated to prevent or mitigate the adverse effects of energy development on the environment. For this purpose, all nuclear-powered plants exploring and utilizing geothermal energy were directed to observe internationally-accepted standards of safety and to provide safety devices to ensure the health and welfare of their personnel as well as of the surrounding community."12 It may be noted that the concern over pollution and depletion of resources were coupled by the first energy crises of 1973. The energy crisis triggered efforts to explore the potentials of indigenous sources of energy. By 1979, the energy plan formulated by the country's energy ministry was acclaimed worldwide as a model program for developing countries.13 From a mere 7.9% in 1973, indigenous resources of energy increased to 35.1% in 1989 which resulted in decreased oil dependence at 61.3%.14 In support of the energy plan, the Batasang Pambansa passed Batas Pambansa Bilang 33 in 1979 declaring it as a state policy to promote energy conservation as a way of life. The law aimed to strengthen measures to conserve energy, and to prohibit those acts that are inimical to public interest and national security. According to Oposa, "speed contests utilizing petroleum-derived fuels, skydiving and water-skiing were prohibited." But "this law has since been honored 10

Ibid., p. 231 Ibid. p. 232 12 Ibid., 233 13 Oposa, p. 223 14 Ibid., 224 11

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Policies on Energy Efficient and Environmentally Sound Technologies  in the breach."15 The following year, Batas Pambansa Bilang 73 prohibited the importation, manufacture or assembly of gasoline powered motor cars with engine displacements of over 2,800 cc., the use of neon lights and electric lights for commercial advertising during certain times of the night, and the use of government vehicles for purposes other than official. Eight years later, during the administration of President Corazon C. Aquino, the government, through the Administrative Code of 1987, declared it as a state policy to conserve natural resources consistent with the necessity of maintaining a sound ecological balance and of protecting and enhancing the quality of the environment. It also declared that the goal of exploration, development and utilization of natural resources is to ensure that such resources shall be equitably accessible to the different segments of the present and future generations. This policy direction of the Aquino administration clearly enunciates the message of the World Commission on Environment and Development, which issued in that year its report, entitled Our Common Future. The report popularized the concept and philosophy of sustainable development. It was also during the Aquino administration that management of environment, natural resources, and mining were placed in one government agency -- the Department of Environment and Natural Resources (DENR). Prior to 1987, the Bureau of Mines implemented the laws related to mining. Such laws include the following: • •

• •

Mining Act (Commonwealth Act No. 137) - excluded from the ownership of a parcel of land the mineral deposits found underneath and declared ownership of the same by the State. PD No. 463 (1974) - revised CA No. 137 by incorporating provisions on environmental protection and also obliging the lessee of mining claims to perform reforestation work within the mining site as provided in CA No. 137 (1936) Consolidated Mines and Administrative Orders (CMAO) - laid down the policy on wise use of minerals and prevention of unnecessary waste,16 requiring the submission of project studies for prospective sand mining operators17 and quarry permit holders.18 Mines Administrative Order No. 16 (1977) - required the restoration of mined-out areas and not less than P20,000.00 surety bond per hectare of a fraction thereof to guarantee faithful compliance in the restoration works. Mine Wastes and Tailings Fee Act (1977) - imposed fee from mining companies to contain future contingencies. The money, which will accrue to a reserve fund, is to be used exclusively to pay for damages on land, agricultural crops and forest products, marine life and aquatic resources; destruction of


Ibid. CMAO Section 42 17 CMAO Section 42-A 18 CMAO Section 42-B 16

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Policies on Energy Efficient and Environmentally Sound Technologies  infrastructure; revegetation and rehabilitation of farm lands, and other areas devoted to agriculture and fishing damaged by pollution. As Oposa correctly pointed out: "From 1936 to 1987, the Bureau of Mines was the only government agency tasked with the implementation of mining laws and the regulation of mining activities. In 1987, the Department of Environment and Natural Resources was created and the functions of the Bureau of Mines were subsumed by the Mines and Geo-Sciences Bureau."19 EO No. 279 (1987) even authorized the DENR Secretary to negotiate and conclude joint venture, coproduction or production sharing agreements for the exploration, development and utilization of mineral resources.20 One of the minimum requirements of the contract is the institution of industrial safety and anti-pollution measures and the restoration and/or protection of the environment. In contrast to the Bureau of Mines, which single-handedly implement mining-related policies and laws for about 50 years, the administration of energyrelated policies and laws went from one government agency to another. According to Oposa, this "penchant for institution changes in response to purported inefficiencies in the administration of laws has led to the proliferation of legislation creating, abolishing and recreating government bodies."21 As a result, the following government bodies were created: • • • • • • • • • • • • • • • •

National Power Corporation (PD. No. 1067) National Institute of Science and Technology (Com. Act. No. 120, 1936) Philippine Atomic energy Commission Atomic Energy Research Center (R.A. No. 2067, 1958) National Electrification Administration (RA 6938, 1969) Power Development Council (PD No. 2699, 1973) Philippine National Oil Company (PD No. 334, 1973) Petroleum Board (PD No. 575, 1974) Energy Development Board (PD No. 8, 1972; PD No. 87, 1972) Philippine National Petroleum Center (PD No. 10, 1976) Department of Energy (PD No. 1206, 1977) Bureau of Energy Development (Id.) Bureau of Energy Utilization (Id.) Department of Environment and Natural Resources (EO No. 131, 1987) Energy Regulatory Board (EO No. 172, 1987) Office of Energy Affairs (EO No. 20, 1986; EO No. 193 (1987) 3. Policy Directions

Lately, the country faces yet another energy problem, which is compounded by environmental, political and social problems. The rising cost of 19

Oposa, 235 Under this undertaking, the private contracting party with at least 60% Filipino owned capital, shall furnish the technical, management and financial services for the development of mineral resources for a period not exceeding 25 years, which is renewable for a similar period. 21 Ibid. 20

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Policies on Energy Efficient and Environmentally Sound Technologies  oil worldwide and the apparent inability of the government to meet such crisis are a clear indication that society has to look for ways of pursuing development with the least cost, both economically and ecologically. As Oposa suggested almost ten years ago: "The energy problem should not be on how to expand supplies to meet the postulated exponential needs of a dynamic economy, but rather how to accomplish social goals with a minimum of energy and effect, meanwhile taking care to preserve the social fabric that not only tolerates but encourages diverse values and lifestyles.22 It is high time, therefore, to actualize the policy of the state that promotes energy efficiency as a way of life. But, as Oposa noted, "a comprehensive package of policies and benefits/incentives is required to accelerate the development of energy efficiency."23 4. Recent Developments in the Energy Sector24 4.1 Creation of the Department of Energy In 1992, Congress enacted RA No. 7638 creating the Department of Energy (DOE). The law mandates DOE to prepare, integrate, coordinate, supervise, and control all government plans, programs, projects, and activities relative to energy exploration, development, utilization, distribution, and conservation. It also declares as a State policy to: •

Ensure a continuous, adequate, and economic supply of energy to ultimately achieve self reliance in the country’s energy requirements through integrated and intensive exploration, production, management and development of the country’s indigenous energy sources, and through judicious conservation, renewal, and efficient utilization of energy to keep pace with the country’s growth and economic development with the active participation of the private sector in various areas of energy resource development, and Rationalize, integrate, and coordinate the various programs of the government towards self - sufficiency and enhanced productivity in power and energy without sacrificing ecological concerns.

In accordance to the RA No. 7638, the DOE formulates its vision, which states that "energy must be adequate, reliable and affordable to industries to enable them to provide continuous employment and low cost goods and services, and to the ordinary citizen to enable them to achieve a decent lifestyle. It should be produced and used in a manner that will promote sustainable development and utilization of the country's natural resources but at the same time maintain 22

Ibid., 259 Ibid., 260 24 For more information, refer to the DOE website at 23

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Policies on Energy Efficient and Environmentally Sound Technologies  the country's overall economic competitiveness." This vision is translated into the DOE Mission Statements that include the following: • • • • •

Formulation of clear policies and responsive plans and programs; Intensive development of indigenous energy sources; Effective coordination of downstream energy activities; Judicious conservation and efficient utilization of energy; Provision of benefits to host communities, and Close coordination and cooperation with other government agencies and private sector entities.

Under the law, the DOE Secretary is authorized to establish policies and standards for the effective, efficient and economic operation of the DOE in accordance with the programs of the Government, and to exercise direct supervision and control over all its functions and activities. The DOE Secretary also has authority to devise a program of international information on the geological and contractual conditions obtaining in the country for oil and gas exploration in order to advance the industry and to create regional offices and such other service units and divisions as may be necessary. Presently, the DOE has the following bureaus and field offices with their respective duties and responsibilities: Energy Planning and Monitoring Bureau •

Assist in the development and updating of an integrated energy plan for the short-, medium-, and long- term periods to provide a comprehensive assessment on the demand scenarios and supply options as well as the impacts of energy policies on the economy, poverty, and environment; Develop and maintain a centralized, comprehensive, and unified data and information program to ensure the efficient collection, evaluation, analysis, and dissemination of data and information on reserves of various energy resources, production, demand, development technology, and related economic and statistical information which are required for policy formulation, program planning, and implementation; Supervise, coordinate, and integrate the formulation, monitoring, and review of programs and plans for energy supply development such as power development such as power development, local energy resource development and production, and energy importation; Regularly review and analyze past and current patterns of energy consumption vis-à-vis growth and development performance of the country's various economic sectors to evaluate current and foreseeable trends in energy demand; and conduct energy supply-demand balancing studies to define energy supply and utilization strategies, estimate the resources required, and assess the energy program's economic environmental, social, and political impact. Assure the incorporation of national environmental goals in the formulation and implementation of energy programs, and to advance the goals of

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restoring, protecting, and enhancing environmental quality, and assuring public health and safety; and Conduct studies on international energy issues that have a direct impact on supply and utilization of energy and provide technical advice on international negotiations involving energy resources and technologies.

Energy Resources Development Bureau • • • • •

Assist in the formulation and implementation of policies to develop and increase the domestic supply of local energy resources like fossil fuels, nuclear fuels, and geothermal resources; Assist in the formulation of sectoral programs and plans relative to the exploration, development, and extraction of local energy resources and implement, monitor, and regularly review said programs; Conduct energy research and studies in support of the aforementioned activities; Provide consultative training and advisory services to practitioners and institutions in the areas of regulated activities; and Assist in the formulation of financial and fiscal policies, rules, guidelines, and requirements relative to the operations of service contractors and implement and enforce said policies.

Energy Utilization Management Bureau •

• •

• • •

Assist in the formulation and implementation of policies for the efficient and economical transformation, conversion, processing, refining, marketing, distribution, transportation, and storage of petroleum, coal, natural gas, geothermal, and other non-conventional energy resources such as wind, solar, biomass, and others; and ensure their efficient and judicious utilization. Monitor sectoral energy consumption and conduct energy audits, technical training, energy management advisory services, and technology application projects on efficient energy utilization; Develop, promote, and commercialize applications of biomass, solar, small hydro, wind, wood, and charcoal and other non-conventional energy systems including new and more efficient and economical transformation, conversion, processing, refining, marketing, distribution, transportation, and storage technologies for conventional energy resources; Assist in the formulation of an integrated rural energy program to effectively address the needs of rural development and environmental programs and implement, monitor, and regularly review said program; Assist in the formulation of an operational plan for the allocation of oil, fuel, and energy sources in the event of the declaration of critically low energy supply. Provide information on energy technology and develop middle- and longterm energy technology development strategies in cooperation with the Department of Science and Technology.

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Policies on Energy Efficient and Environmentally Sound Technologies  • • • •

Monitor the implementation of energy projects in coordination with the Department of Environment and Natural Resources to ensure compliance with prescribed environmental standards; Recommended appropriate courses of action to resolve major issues which may impede energy project siting or result in adverse environmental impact; Require industrial, commercial, and transport establishments to collect or cause the collection of waste oil for recycling as fuel or lubricating oil; and Develop and implement a continuing energy conservation program designed to optimize energy utilization, including a nationwide information campaign on energy conservation.

Energy Industry Administration Bureau •

• •

Assist in the formulation of regulatory policies to encourage and guide the operations of both government and private entities involved in energy resource supply activities such as independent power production, electricity distribution, as well as the importation, exportation, stockpiling, storage, shipping, transportation, refinement, processing, marketing, and distribution of all forms of energy and energy products, whether conventional of nonconventional. Draw up plans to cope with contingencies of energy supply interruptions; and Assist in the formulation of financial and fiscal policies, rules, guidelines, and requirements relative to the operations of entities involved in the supply of energy resources such as oil companies, petroleum product dealers, coal importing and distributing companies, natural gas distributing companies, independent power producers, and all other entities involved in conventional energy supply activities and implement and enforce said policies.

Field Offices •

Implement laws, policies, plans and programs and rules and regulations of the DOE affecting all aspects of the oil industry in their respective areas of jurisdiction, through among others are the following : a) Inspection of refineries, depots, LPG, refilling plants and other related terminals to observe plant operations. Determine whether operational capacity is within that authorized by law, determine the product inventory levels at any given time, and/or determine whether measures prescribed and restrictions imposed in consideration of the ecological and environmental needs of the community are being complied with. b) Investigation of complaints for underselling, adulteration, operation and related activities without permit/ license, illegal construction, and such other violations of DOE rules, orders and decisions. c) Inspection of petroleum retail outlets like gasoline stations, kerosene distribution outlets, lubes and grease resellers, and establishments engaged

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Policies on Energy Efficient and Environmentally Sound Technologies  in the business and sale of LPG to determine compliance with the DOE's order, decision, rules and regulations. d) Inspection of actual construction of petroleum product retail outlets to determine compliance with approved plans and specifications and with DOE regulations. • • •

• • • •

Conduct hearings for the reception of evidence in investigations of violations of DOE rules and regulations. Represent the DOE in hearings before any court in connection with cases filed against person(s) for violations of DOE laws, rules and regulations, orders and decisions. Gather information and prepare periodic reports and recommendations on consumption, utilization, conservation, availability of petroleum products in the locality, and trade practices of those engaged in the marketing, distribution, hauling, storing, repacking and selling of petroleum and specialty products, which information are to be made the basis of studies in the formulation of policies and decisions of the Department. Monitor oil, coal and geothermal exploration, development and production activities in the area as maybe necessary. Conduct safety audit / inspection of coalmines and geothermal plants / installations. Conduct inventory and monitor tax - exempt imported equipment, machineries and materials of contractors under Presidential Decree Nos. 87, 972 and 1442. Submit reports on the activities of the office and other documents to the Undersecretary for Operations through the concerned Bureau Director.

4.2 Energy Plan Objectives and Strategies When Pres. Joseph Ejercito Estrada assumed office in 1998, the Philippine economy was already affected and reeling from the adverse impacts of the Asian economic crisis. In response to this, Pres. Estrada pursued a development program that balances economic growth and social equity. He also continued the pursuit of deregulation, liberalization, and privatization -- all trademarks of a global market economy. Under the Medium-term Philippine Development Plan (MTPDP), the country gears for "economic growth with social equity, led by a dynamic and internationally competitive private sector that is supported by an efficient and impartial government." In line with the MTPDP, the DOE prepared a new Philippine Energy Plan, which aims for the following: •

Supply Security and Reliability - To ensure sustainability of energy supply through the continuous exploration and development of indigenous energy. Thus, the DOE will encourage the development and utilization of indigenous energy resources by enabling reasonable returns on investment for private

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• • •

developers while achieving maximum benefit to the Filipino people and revenues to the government. Energy Affordability and Accessibility - To make energy accessible to all areas and sectors of the economy in view of the social equity and poverty reduction thrusts of the government. Environmental Quality - To enhance integration of energy and environmental policies and program implementation in the context of global and national initiatives to mitigate impacts of climate change and local pollution. Consumer Protection - To protect consumers from market power abuses.

4.3 Major Programs The major programs of the energy sector include institutional reforms, electrification, energy efficiency, and environmental management. Institutional Reforms The current initiatives involve the review of existing policies and formulation of appropriate structural reforms that observe the principles of sustainable development and global competitiveness. The structural reforms will be pursued in the power and downstream oil and gas sectors to create an environment that is market-friendly and conducive to private sector investment and participation. An example is the deregulation of the downstream oil industry. Electrification The DOE aims for total electrification of all rural barangays by 2008 as part of its mission to improve the standard of living of people in these areas. Under the Philippine Energy Plan (PEP) 2000, about 90% of all barangays will be provided with electricity by 2004. Energy Efficiency The PEP 2000 also provides appropriate strategies and major energy efficiency programs to encourage the economic, efficient and effective use of all forms of energy. The strategies for implementation include the following: • • •

aggressive promotion of energy conservation and energy-efficient technologies in the residential, commercial, industrial, transport and power sectors; provide technical assistance to energy-intensive industries in identifying, implementing and evaluating effective energy efficiency measures, and passage of the Energy Conservation Bill into law.

The specific programs geared to achieve the targeted energy efficiency are as follows: • •

Vehicle Efficiency Standards and Testing System Loss Reduction Program for Electric Utilities

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Policies on Energy Efficient and Environmentally Sound Technologies  • • • • • • •

Heat Rate Improvement of Power Plants Energy Audit Financing Energy Conservation Projects Energy Efficiency Information Campaign Room Airconditioner (RAC) Energy Standards and Labeling Refrigerator and Freezer Energy Labeling Fluorescent Lamp Ballast Energy Labeling Environmental Management

The DOE is currently pursuing policies and programs to ensure an integrated energy-environment approach. Such policies will guide the development and utilization of energy resources in accordance to established principles of economics and cultural and ecological sensitivity.

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Chapter IV Impacts of E3ST-Related Policies to E3ST Promotion "In order to protect the environment, the precautionary approach shall be widely applied by the states according to their capabilities. Where there are threats of serious or irreversible damage, lack of full scientific certainty shall not be used as a reason for postponing cost-effective measures to prevent environmental degradation." - Rio Declaration on Environment and Development Principles

1. Introduction Energy efficient and environmentally sound technology (E3ST) refers to systems, processes and devices that ensure the maximum productivity of a project or undertaking while, at the same time, minimizing the use of energy and negative impacts to human health and environmental quality. The policies that can lend support in promoting E3ST, especially in small and medium industries or enterprises, are generally reflected in official pronouncements of the government such as presidential speeches and issuances, among others, laws enacted by Congress, and rules and regulations promulgated by authorized and competent authorities. In the case of the Philippines, most of the E3ST-related policies are documented in laws as well as in rules and regulations. The laws of governments, including the rules and regulations that implement them, are translations of the natural laws1 or what the natural sciences call the fundamental ecological processes. One way of determining the quality of State laws, therefore, is by analyzing the manner by which they are patterned after the natural or ecological principles. For instance, the notion of sustainable development is practically derived from the ability of the environment to create and propagate natural resources and perform the natural processes over time or since the known beginning of planet Earth. Stated in anthropological terms, sustainable development involves the satisfaction of human needs over a long period of time2. The World Commission on Environment and Development (WCED) describes sustainable development as "development that meets the needs of the present generation without compromising the ability of future generations 1

The natural laws applied to human beings fall under the category of natural moral law since they involve questions about the morality of a human act, i.e. the goodness or badness of a human act. 2 Taken from Alan S. Cajes, "Philosophy of Sustainable development: A Critique." An unpublished Master's Thesis, Graduate School, Royal and Pontifical University of Santo Tomas, 1998.

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Policies on Energy Efficient and Environmentally Sound Technologies  to meet their own needs." The ability, however, of the present and future generations to meet their needs depends on the quality and integrity of natural capital3. It would be meaningless to talk of sustainable development when there is an extreme scarcity and degradation of natural capital. Obviously, the resources, capacities and services of nature support human life. Thus, the idea of sustainable development necessarily includes environmental conservation, protection, and enhancement or what is commonly called environmental management. 2. Ecological Foundations of E3ST-Related Policies Environmental management observes ecological laws or principles, namely, conservation, reuse, restoration, adaptability, carrying capacity, and renewable resource use. These principles are briefly discussed below. 2.1 Ecological Principles Principle of Conservation In essence, conservation is “using only what is needed” or the frugal and efficient use of material resources4. This principle is based on the observable consumption pattern of organisms, which use only the resources necessary for their subsistence. Organisms have natural wants, in contrast to human beings who have unnatural wants. The satisfaction of the natural wants or needs does not demand resources over and beyond what is biologically necessary. The implication of this principle is that human beings should be more efficient in using the material resources and by being such “we can significantly reduce energy demand, habitat damage, pollution, and ensure a steady supply of resources for future generations.”5 Since the environmental crisis is the product of the “reduction in the abundance of the natural environment,” the solution of this crisis can begin by maintaining or enhancing the supply of material resources. Principle of Recycling or Reuse Recycling or reuse means using resources more than once. This is important to make the principle of conservation operational. The concept of reuse takes off from the law of nature, which states that matter and energy are neither created nor destroyed. Because of this law, “everything ultimately becomes waste, and returns in some form to the environment.” The wastes that are beyond the capacity of the environment to


Natural capital is the collective term of the environmental resources and services. Daniel Chiras, Environmental Science. Action for a Sustainable Future (California: the Benjamin/Cummings Publishing Co., Inc., 1994), inside back cover. 5 Ibid. 4

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Policies on Energy Efficient and Environmentally Sound Technologies  recycle are called stored wastes or pollution. These wastes can have negative impacts to the natural environment. Recycling is important because it “saves energy and reduces all forms of pollution." It stretches the limited supplies of finite resources and protects wildlife habitat. It also creates unparalleled employment and business opportunities. Principle of Restoration The natural environment operates “broadly around equilibria or can be manipulated to approximate steady states following human intervention”6. This is referred to as homeostasis, which is a state of relative constancy in organisms and ecosystems, a kind of “dynamic equilibrium.” In other words, nature maintains a delicate balance and has the capacity to heal herself or recover when damaged or exploited at a level within its carrying capacity. The value of restoring natural systems and the plant and animal communities that once thrived in them lies in the benefits that human and non-human beings can derive from it such as the “sustainable flow of resources as well as innumerable free services” like flood control and waste assimilation. Principle of Carrying Capacity Carrying capacity is defined as the maximum “population size that a given ecosystem can support for an indefinite period of time or on a sustainable basis.” Two types of carrying capacities can be distinguished: • •

Ecological or biophysical carrying capacity or the maximal population size which can be maintained by nature with a given technology within a specific area, and Societal carrying capacity, which is the maximal population size which can be supported given the different social systems7.

The principle of carrying capacity is referred to as the principle of tolerance and limits of nature. It involves the idea that natural processes, for instance the growth and propagation of trees, take a long period of time and require enough species diversity in order to occur. Thus, the consumption of resources by human beings should not go beyond the point wherein fundamental ecological processes are impaired,8 i.e., the “societal carrying capacity must stay within ecological carrying capacity”9.


Timothy O’Riordian, “The Politics of Sustainability” in Sustainable Environmental Management Principles and Practice, 29-50. 7 Swedish Environmental Advisory Council, Trade and the Environment - Towards a Sustainable Playing Field (Stockholm: Swedish Environmental Advisory Council, 1994), 16. 8 Delfin Ganapin Jr., “Principles of Sustainable Development” paper delivered at the Workshop on Developing an Environmental Management Framework and an Environmental Monitoring and Evaluation System for the Cagayan de Oro - Iligan Corridor, Midway White Beach Resort, Initao, Misamis Oriental, Philippines, 30 August to 1 September, 1995. 9 Swedish Environmental Advisory Council, 16.

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Policies on Energy Efficient and Environmentally Sound Technologies  Principle of Adaptability The term adaptation means the “genetically determined structural or functional characteristic of an organism that enhances its chances of reproducing and passing on its genes”10. It enables the natural systems to persist by adapting to change. This principle implies that human society “must adapt to changes it has created through cultural changes -- changes in our ethics and our way of living and conducting business”11. Hence, human beings should not continue the excessive and destructive patterns of consumption in the face of the current environmental crisis. Principle of Renewable Resource Use The environment has renewable resources like water, plants, animals, sunlight and wind. The fundamental ecological processes renew these resources. In contrast, the non-renewable resources refer to those that are present in the environment in limited quantities. The fundamental ecological processes are not capable of renewing or increasing the quantity of such resources. The principle of renewable resource use implies that human society should constantly seek better ways of using renewable resources than the non-renewable resources. This means that extraction of renewable resources should be equal or less than the capacity of these resources to regenerate and must not destroy biological diversity. 2.2 Relationship between Environmental Protection


Principles and




The ecological principles are the immediate bases of the general principles of environmental protection, namely, the ecocycle society principle, principle of critical loads, precautionary principle, substitution principle, best available technology principle, polluter pays principle, extended product responsibility principle, and the sustainable development principle. A brief discussion of these principles is presented below. Ecocycle Society Principle The ecocycle society principle applies the principle of "cyclic material management" in order to reduce and close the flows of materials to the extent that: •

10 11

The materials that society produces can be incorporated to the natural cycle without impairing the natural capacities and services (Principle of Recycling or Reuse);

Chiras, 578. Ibid., inside back cover.

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Policies on Energy Efficient and Environmentally Sound Technologies  • •

There is a reduction in the use and extraction of non-renewable resources (Principle of Renewable Resource Use), and The natural capital meets human needs in such a way that the extraction of natural capital does not exceed the growth in inflow Principle of Carrying Capacity)12. Principle of Critical Load

Critical load refers to the “highest load at which no harm is caused to the environment, even after long-term exposure”13. This implies that any economic activity should ensure that its negative impacts to the environment remain at a level that is not significant. Thus, the carrying capacity of the environment is taken into due consideration in economic planning and project implementation (Principle of Carrying Capacity). Extended Product Responsibility Principle The principle of extended product responsibility is an emerging principle that uses the life-cycle approach to identify strategic opportunities for pollution prevention and resource conservation. Based on this principle, the manufacturers, suppliers, users, and disposers of products have the collective responsibility for the “environmental effects of products and wastes streams (Principles of Conservation, Reuse, Restoration, and Adaptability) The precautionary, substitution, best available technology, polluter pays, and sustainable development principles are already discussed in Chapter I. These principles are based on one or more ecological principles. In the context of this paper, the sustainable development principle is considered as the "umbrella principle" of the generally accepted principles of environmental protection. 2.3 Principles of Environmental Protection in E3ST-Related Policies The principle of sustainable development is evident in the Philippine Agenda 21, which is the overall framework of the country's search for national development. This principle is also evident in the 1987 Philippine Constitution and in various laws, rules and regulations in the country. The Constitution provides the "State shall protect and advance the right of the people to a balanced an healthful ecology in accord with the rhythm and harmony of nature.” Under the Local Government Code of 1991, the LGUs are responsible for implementing the mandate of the Constitution, as well as the provisions of Department Administrative Order No. 30, Series of 1992, which devolves to the LGUs such functions, programs and projects as forest management, protected areas and wildlife, and environmental management. The Philippine


Bjorn Wallen, “The Principles of the Ecocycle Society” in On the General Principles of Environmental Protection, 21-34. 13 Henning Rodhe, “The Concept of Critical Loads” in On the General Principles of Environmental Protection, 35-43.

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Policies on Energy Efficient and Environmentally Sound Technologies  Environmental Policy also provides the following goals of the State, which may be considered as the Philippine's early version of sustainable development: • • •

To create, develop, maintain and improve conditions under which man and nature can thrive in productive and enjoyable harmony with each other; To fulfill the social, economic and other requirements of present and future generations of Filipinos, and To insure the attainment of an environment quality that is conducive to a life of dignity and well being.

The other laws that contain provisions on sustainable development are the National Integrated Protected Areas System (NIPAS) Law, Strategic Environmental Plan for Palawan Act, Agriculture and Fisheries Modernization Act. The United Nations Framework Convention on Climate Change provides that the lack of scientific evidence should not be the basis for delaying actions to prevent climate change. This statement aptly describes the precautionary principle, which is also an important feature of the Clean Air Act and its implementing rules and regulations that prohibit "any person from causing, letting, or allowing the emission of a particulate matter from any source whatsoever without taking reasonable precautions to prevent such emission." Under the Philippine EIS System, the precautionary principle is important since it serves as the backbone of the law itself. The reason is that the process of identifying, assessing and managing the impacts of a project or undertaking to the environment lies at the very core of the notion of precaution. The best available technology (BAT) principle is also an important feature of the Clean Air Act and its implementing rules and regulations. In particular, these laws require the following: • • •

Installation and operation of best available control technology that will provide the lowest achievable emission rate (LAER); Installation and operation of continuous emission monitoring systems (CEMS) or devices, and Requiring the use of the best practicable means to prevent or minimize air pollution through the employment if cleaner production and sound environmental management practices.

The BAT principle is also important under the Philippine EIS System since the precautionary principle is not operational when proponents would not use the best available technologies to enhance the positive or mitigate the negative impacts of their project or undertaking. The substitution principle is related to the BAT principle in the sense that the best available technologies are, in effect, substitutes to existing or available technologies that do not effectively minimize the pollution. This principle also applies to laws, rules and regulations that prohibit the use of certain chemicals or substances because of their serious environmental impacts. Persons using such Alan S. Cajes 

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Policies on Energy Efficient and Environmentally Sound Technologies  prohibited chemicals or substances are required to use environment-friendly replacements or substitutes. The polluter pays principle (PPP) applies in almost all environmental laws, rules and regulations in the country. In particular, the PPP principle is the basis of the fines and penalties imposed on soil, air, and water pollution. This principle is also an important concept under the EIS System because it requires the proponents to pay for the cost of EIA, review of the EIS, implementation and monitoring of the environmental management plan. The ecocycle society principle is implicitly cited in laws, rules and regulations that prohibit air, water and soil pollution. For instance, PD No. 979 regulates those activities that can damage the marine environment by promoting the use of the best practicable means and improved disposal processes to minimize harmful wastes. This law implies that wastes, especially the nonbiodegradable ones, could create hazards to human health, harm living resources and marine life, damage amenities, or interfere with the legitimate uses of the sea. The principle of critical loads is particularly important under the EIS System, which require the identification and assessment of impacts of any project or undertaking to the environment. This principle is the basis for determining whether an impact is within the carrying capacity of the environment or not so that appropriate measures can be undertaken. The extended product responsibility (EPR) principle, although widely accepted by environment professionals and practitioners, is not yet fully reflected in the country's laws, rules and regulations. As a result, a lot of products and packaging materials in the market such as aluminum tin cans are simply disposed of. No manufacturer, user or disposer is held accountable of the environmental impacts of such products and packaging materials. 3. Impacts of E3ST-Related Policies The first part of this section summarizes the policies from the environment and energy sectors that have an impact on the promotion of energy efficient and environmentally sound technologies (E3ST). The second part discusses the various instruments that are used to implement such policies. The last part discusses the impacts of the policies to the promotion of E3ST. 3.1 Summary of Policies The 1987 Philippine Constitution, which is the fundamental law of the country, constitutes the Philippine State and embodies the terms and conditions of the social contract of the citizens. The Constitution, therefore, is an important document because it specifies the nature of the State. Because of this, all laws enacted by Congress, rules and regulations promulgated by the Departments, proclamations and other issuances of the Chief Executive, and ordinances or resolutions of local government units (LGUs) must conform to the letter and spirit Alan S. Cajes 

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Policies on Energy Efficient and Environmentally Sound Technologies  of the provisions of the Constitution. According to Amado Tolentino: "The first hierarchical legislative level of any country is the Constitution. No doubt, constitutional provisions help highlight a national priority and thereby influence future legislative policies and executive actions14. The Constitution embodies the fundamental environment and energyrelated policies, which affect the promotion of E3ST in the country. These policies are the (a) promotion and advancement of the right of the people to a healthful and balanced ecology, (b) protection and promotion of the people's right to health, (c) recognition of the people's rights to due process, information, just compensation, and to participate in nation building, and (d) State ownership of resources within the territory under the Regalian Doctrine. As a consequence of these fundamental policies, the government controls and/or prohibits air, land, and water pollution and other forms of uncleanliness or unsanitary practices. The immediate reason for this policy is to ensure that the government protects public health and prevents any harm to the people and ecosystems as a result of calamities brought about by pollution. In line with such a policy, the government prohibits the environmentally destructive activities or those that destroy the natural resources. It also requires the owners or operators of projects and undertakings to use suitable remedies to prevent or minimize the emission of pollution. Such policies are necessary so as not to disrupt the "rhythm and harmony of nature" and to attain an environment quality that is conducive to a life of dignity and well being. In relation to the use of suitable remedies, the government requires the use of the best practicable means and improved disposal processes to minimize the production and impacts of harmful wastes. The use of the best available technology in manufacturing and industrial activities and processes is also necessary to increase efficiency and productivity, and to conserve the use of energy. By virtue of State ownership of the natural resources under the Regalian Doctrine, the government regulates the allocation and use of natural resources for the general benefit of the people. In relation to this policy, the government protects certain plant and animal species, as well as certain areas such as those suitable for the establishment of national parks. Specifically, the government, through the NIPAS Law, promotes an intensive and integrated program of environmental protection that will bring about a concerted effort in protecting the whole spectrum of the environment. The government's adoption of the philosophy of sustainable development is consistent to the fundamental policy that promotes and advances the right of the people to a balanced and healthful ecology. This fundamental policy is supplemented by statutory policies aimed to ensure the productive and enjoyable 14

Amado S. Tolentino, Jr., "Review of Environmental Legislation and Administration and its Application in Selected DMCs" in Environmental Planning and Management, ADB, 1986.

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Policies on Energy Efficient and Environmentally Sound Technologies  harmony between man and nature through the effective utilization of resources, and environmental management. Specifically, the government adopts a policy to ensure the sustainable use, development, management, renewal, and conservation of the country's forest, mineral land, off-shore areas, and other natural resources, including the protection and enhancement of environmental quality. It also requires the restoration or rehabilitation of certain areas affected by the exploitation of resources back to their original condition. In the energy sector, the adoption of sustainable development as a guiding principle is clearly manifested in the policies that emphasize the conservation and judicious use of energy and mineral resources, and promote energy conservation as a way of life. These policies are supported by another policy, which mandates an integrated and intensive exploration, production, management and development of the country’s indigenous energy sources, as well as judicious conservation, renewal, and efficient utilization of energy, with the active participation of the private sector, in various areas of energy resource development. 3.2 Policy Implementation Instruments The Philippine Government uses a number of instruments to implement the E3ST-related policies. These instruments may be categorized as follows: (1) command/control instruments; (2) institutional mechanisms; (3) environmental management tools and approaches; (4) economic or market-based instruments; (5) information, education and communication (IEC), and (6) networking and public participation. Command/Control Instruments Command/control instruments refer to the traditional approaches of governance in which an institution tasked to implement a set of laws, rules and regulations uses a top-down approach or obey-or-be-punished type of administration. These instruments are punitive in character. There are three types of command/control instruments that may be distinguished. The first instrument takes the form of administrative sanctions, which are often used. These sanctions "consist of non-compliance with or violation of prohibitions, permits, authorizations, clearances, discharge limits and other administrative standards and orders defined in the rules and regulations, and could result in revocation or cancellation of permits and licenses, as well as administrative fines and other penalties15." Amado S. Tolentino pointed out that an important feature of the regulatory measures in some Asian countries, including the Philippines, involves the legal requirement for permits and licensing prior to undertaking activities such as mining, construction, taking of forest products, trade, industry, sale or use of 15

Ibid., p. 82

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Policies on Energy Efficient and Environmentally Sound Technologies  radioactive substances, etc. This requirement, he said, allows government to keep track of the nature, type and density of activities in the project site. It may also facilitate "relocation or a constant review of the state of the environment as a result from those activities." He concluded that "the imposition of conditions to protect and conserve the environment, the license-issuing authority plays a vital role in solving or minimizing the adverse effects of human activities on the environment." For instance, he explained, "limitations on the quality and type of forest products, oil and gas and minerals that can be extracted, limitation on the type, size and distribution of a particular trade or industry, requirement by license-holders to rehabilitate used mining land, and regulations on the emissions (solid, liquid or gaseous) from industries16." As regards environmental pollution, Tolentino identified two kinds of regulatory controls applied to point sources of pollution. These include specification standards and performance standards. Specification standards prescribe that particular measures like anti-pollution devices or equipment be installed to prevent environmental degradation, while performance standards provide for certain level of performance that must be achieved17. The second type involves judicial remedies or the imposition of fines and imprisonment. According to Tolentino, the proceeds from judicial remedies are usually deposited in the National Treasury for disposition as general revenues. The Clean Air Act, for instance, provides for the establishment of an Air Quality Management Fund. A third type of command/control instrument includes civil actions filed against a violator. Civil actions have three categories, namely, violation of the law, injunction, and damages. Tolentino explains this instrument: "Where the law either does not provide for a penal sanction [or] when it leaves the choice open, a civil suit could be filed against the violator. An option to proceed on the basis of a civil complaint facilitates action against a violator inasmuch as a civil action usually requires less rigorous proof of intent and negligence. Injunction seeks a judicial order to cease and desist from an environmentally noxious activity in violation of the law. Lastly, action in damages is available as a remedy for losses caused by alleged violation of law and regulations. This action is based either on a specific provision in the environmental law or on general tort law18. Institutional Mechanisms 16

Ibid., p. 63 Ibid., p. 63-64 18 Ibid., p. 82 17

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Policies on Energy Efficient and Environmentally Sound Technologies  The use of institutional mechanisms in environmental legislation and governance cannot be discounted considering that one of the most momentous problems that confront democratic states like the Philippines is the ability to formulate rational, responsible, and goal-oriented policy. In the case of political administrative institutions, which generally refer to the government bureaucracy, a major criterion for determining organizational efficiency is the ability to formulate policy proposals for the political superiors. Consequently, a major task of administration is the formulation of policy proposals for consideration by the political executive and the legislature. Here, the capacity of institutions to perform rationally and responsibly the task of formulating the policy alternatives for politically responsible superiors is the major criterion of organization efficiency. According to Norton E. Long, the beginning of wisdom in administrative analysis consists in a realistic assessment of the capacity of the organization to think19. He explains: "The doctrine of the political supremacy of the elected over the non-elected branch of government has inspired the delusion that to be politically supreme, the legislature must not only make final decisions on policy, but must also have primacy in the whole process of policy formulation - that the bureaucracy should be an instrument rather than a brain…In practice it must be recognized that the bureaucracy, is a part, and a highly important part, of the collective brain that somehow thinks or emotes a government policy…The establishment of policy consensus and the search for politically acceptable values is a highest priority endeavor20." In relation to environmental governance, environmental law and policymaking are important but not sufficient to ensure the protection and enhancement of the environment. Equally important are the growth and development of environmental institutional arrangements that can effectively and uniformly implement laws and policies. Tolentino says: "An environmental protection institution's broad mission may be described as the defense of the environment. Such an institution provides an integrated and coordinated approach to environmental protection, based on a view of the environment as it truly is. Such an approach could involve a single system or several systems of interdependent and interrelated parts. It is the primary aim of environmental protection institutions to 19 20

Norton E. Long, The Polity (Chicago: Mand McNally & Co., c. 1962), pp. 77-93 See Norton E. Long, 1962

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Policies on Energy Efficient and Environmentally Sound Technologies  simultaneously consolidate, evaluate and improve the knowledge available, applying the many techniques for environmental management and anticipate what lies ahead21." Tolentino observed that in the past administrations, the environmental management functions were "variously delegated to a multiple of government agencies at both the local and national levels." He thought that this type of environmental administration "was anomalous insofar as there was little or no coordination within and between the two levels or among agencies concerned." As a result, "The national leadership, taking note of the lack of a total environmental protection program and the lack of a coordinated system in the enforcement of existing environmental-related laws, enacted PD 1121 in 1977, creating the National Environmental Protection Council (NEPC). NEPC is the central authority that overseas, unifies and integrates the planning, management and implementation of the Government's environment program22." Tolentino's observation of the environmental administration in the past jives with Oposa's observation in relation to the administration of energy-related policies and laws, which went from one government agency to another. According to Oposa, this "penchant for institution changes in response to purported inefficiencies in the administration of laws has led to the proliferation of legislation creating, abolishing and recreating government bodies."23 Currently, environmental administration generally observes the principle of subsidiarity, which empowers the communities within or near a natural resource area to take responsibility of protecting and managing such resources instead of merely benefiting from them. This institutional mechanism provides local communities with the opportunity to undertake a community-based resource management (CBRM). CBRM has been used in various natural resource areas such as coastal and forest zones. A number of projects are now being implemented, namely, community or integrated coastal resources management and community-based forest management projects. The principle of subsidiarity is also the immediate foundation of the devolution of environment-related functions to LGUs. Such devolution is premised on the notion that those communities or political institutions that are nearest to a natural resource area are in a better position to protect and enhance the resources therein. 21

Tolentino., p. 54 Ibid., p. 59 23 Ibid. 22

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Policies on Energy Efficient and Environmentally Sound Technologies  Another trend in environmental administration relates to the sharing of responsibilities by various sectors or stakeholders of society. The distribution of responsibilities over environmental protection and management to national government agencies like DENR and DOH, local government units, and local communities has resulted in the evolution of new institutional arrangements or mechanisms. Examples include the creation of permanent or ad-hoc interagency or intersectoral coordinating groups whose membership cuts across various stakeholders and interested groups. These groups are provided with funds to enable them to perform their assigned tasks and functions. This trend appears to meet Tolentino's basic requirement for success in environmental management. He explains: "Success in environmental management depends on the proper implementation of the environmental policies adopted using as a tool an efficient public administration, in which sectors and areas of responsibility need to be restructured or supplemented through reorganization of agencies or through the coordination of those extant. Public administration in this regard includes all branches of government legislative, executive and judicial. Laws in the sense of assignment of responsibilities and budgetary authorizations are needed to accomplish the task24." Environmental Management Tools and Approaches Environmental management tools and approaches such as area-based resource management, EIA, environmental planning and management, installation of an environmental management system, and self-monitoring are now part of the policy instruments in the country. These instruments aim to gather sufficient data and information to ensure a better and informed decision-making, to integrate all relevant activities, and to provide a venue for coordination by various players or stakeholders.

Integrated Area Resource Management The current initiatives to promote integrated area resource management are brought about by the recognition of the importance of observing the basic laws of ecology in environmental management. According to Barry Commoner, the laws of ecology can be reduced into four laws. These are as follows: • • • • 24

Everything is connected to something else; Everything must go nowhere; Nature knows best, and Nothing comes free Ibid., p. 77

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Policies on Energy Efficient and Environmentally Sound Technologies  The basic message of these laws is that nature observes the fundamental principle of unity amid diversity. Thus, environmental management begins and ends with the ecological systems. Consequently, natural resource planning and management has to be systemic in contrast to past practices that were confusing because they were disjointed and uncoordinated. Integrated area resource management aims to assist ordinary people improve their quality of life, to promote a place-based or bottom-up approach to environmental management, to encourage people to become actors, not merely the beneficiaries, of development, and to encourage collective self-realization and community action. It is consistent to the principle of biogeographical equity and community-based resource management under PA 21, which states that those "communities residing within or most proximate to an ecosystem... should be given prior claim to the development decisions affecting that ecosystem, including management of the resources. To ensure biogeographic equity, other affected communities should be involved in such decisions."

Environmental Impact Assessment25 Environmental impact assessment (EIA) is defined as the process of identifying, predicting, evaluating, and mitigating the biophysical, social, and other relevant effects of proposed projects and physical activities before making major decisions and commitments for their implementation. As a process, it involves multidisciplinary experts and stakeholders. In relation to environmental management, EIA is used basically as a planning tool but can also become, through the EIS, a monitoring instrument and through the ECC conditions a regulatory tool. There are two substantive goals of EIA: First, to facilitate sound, integrated decision- making in which environmental considerations are explicitly included; second, to achieve or support the goals of environmental protection and sustainable development. It has also evolved, internationally, as a multi-purpose process that emphasizes the promotion of long-term societal goals, which reflect and express the following ideals of sustainable development: • • • • • •

Safeguarding valued ecological processes and heritage areas; Avoiding irreversible and unacceptable loss and deterioration of natural capital; Ensuring that development is adjusted to the potentials and capacities of the resource base; Optimizing natural resource use, conservation and management opportunities; Protecting human health and community well being, and Addressing distributional concerns related to the disruption of people and traditional lifestyles.


Much of the ideas in this part of this work are taken liberally from the US Environmental Protection Agency (EPA) Sourcebook and the World Bank Environmental Assessment Sourcebook.

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Policies on Energy Efficient and Environmentally Sound Technologies  Specifically, EIA aims to achieve the following: • • • • • • • • •

Better, informed, and democratic decision making Public participation or involvement Analysis of viable alternatives Prediction of impacts Prevention of avoidable negative impacts Mitigation of unavoidable negative impacts Enhancement of positive impacts Follow-up or monitoring and feedback Compliance to government and industry regulations

Environmental Planning and Management Environmental planning and management (EPM) refers to the process of addressing an environmental problem or protecting and enhancing a natural resource. In relation to EIA, EPM is used to enhance the positive or mitigate the negative impacts of a project or undertaking. In relation to environmental management, in general, EPM is used to formulate the goals that have to be accomplished as regards the identified environmental problems, as well as to determine the strategies that will ensure the attainment of such goals. EPM is an important tool or instrument in environmental management since it fosters cooperation among the various stakeholders and interested parties, and identifies areas for compliance monitoring to determine the success or failure of the EPM implementation. The general steps in EPM are as follows: • • • • • •

Prepare a policy, guidelines and strategy for preventing and solving urban environmental problems complying with governmental policies at national and provincial levels, including other local neighboring authorities; Cooperate with private or public agencies and organization to solve the urban environmental problems within its borders; Prioritize issues for preparation of action plans according to local needs and capacity; Form Working Groups to prepare the action plans; Consider approval of the action plans for assigned priority issue by Subject Working Groups, and Form a special awareness-raising group to prepare awareness raising action plans in support of the general urban environmental management program.

The specific EPM steps include the following: • • • •

Initiating the process; Collection of urban environmental data; Conduct of survey; Preparation of urban environmental profile and indicators;

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Policies on Energy Efficient and Environmentally Sound Technologies  • • • • • • • • • •

Selection of priority issues and formation of working groups; Analysis of the urban environmental problems related to the priority issue; Preparation of solution proposals; Decision on a strategy by selecting among the solution proposals; Collection of supplementary data for monitoring and evaluation procedures; Preparation and conduct of public hearing; Preparation of final draft action plans for each selected solution; Approval of final action plans for implementation; Preparation for funding and coordination with other municipal plans, and Preparation and conduct of a full-scale awareness raising campaign

Environmental Management System Environmental Management System (EMS) is an approach to manage the activities of an organization to continually improve its environmental performance. EMS as popularized by ISO 14000 follows the Deming’s principle of management, i.e., Plan, Do, Check and Act (PDCA) cycle. EMS has six elements, which are briefly described below. Environmental Policy. This element is defined by the top management of an organization based on the nature, scale, and impacts of its activities, products and services. It embodies the organization's commitment for continual improvement and prevention of pollution, commitment to comply with environmental legislation, regulations, agreements and other requirements. It also serves as a framework for setting up and reviewing the environmental objectives and targets. To make the policy available to a wide audience, it is documented, implemented, maintained, and communicated to all employees, as well as to the partners and other stakeholders. Environmental Management Programme. This element translates the organization's Environmental Policy into operational terms. It contains specific objectives and targets at the organizational level and at each relevant function/office level of the organization. The programme is formulated based on identified environmental aspects, as well as legal and other requirements. It contains the activities to achieve the objectives and targets, including the means and time frame by which they are to be achieved and the human and financial resources. Under this element, the Implementation and Operation Plan. organization defines the roles, responsibilities and authorities needed to implement the EMS. Specifically, this element includes the resources necessary to implement the EMS, training program for the employees, procedures for establishing and maintaining the internal and external communications, and procedures for establishing and maintaining documentation and document control. Here, the organization plans its operations and activities to ensure that they are carried out under specified conditions. It also needs to establish and maintain procedures for emergency preparedness and response. Alan S. Cajes 

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Policies on Energy Efficient and Environmentally Sound Technologies  Environmental Monitoring Plan. The environmental monitoring plan includes the procedures for establishing and maintaining a system to monitor and measure relevant operations and activities. The organization defines the responsibility and authority to handle and investigate non-conformance, to take action or manage the resulting impacts, and to initiate and complete a corrective and preventive action. This element requires the organization to properly manage its environmental records, and to identify procedures or programs for conducting periodic EMS audits. Management Review. This element provides an opportunity for the organization's senior management to review the EMS. It aims to ensure the continuing suitability, adequacy and effectiveness of the EMS. The management review addresses concerns such as the possible need for changes or improvements in the other elements of the EMS. Continuous Improvement. The relevance and effectivity of the EMS depends on the ability of the organization to enhance the other elements to meet current and future needs or requirements. Under this element, the organization determines certain processes, activities or resource requirements that may stand further improvements, or, when necessary, modification. The organization also documents its performance in implementing the EMS to generate information that can be used for internal benchmarking. Under this element, the organization also compares its performance to other organizations or benchmarks to get sufficient bases for improvement.

Self-Monitoring or Industry-Monitoring Self-monitoring is an instrument used to encourage industries to measure their level of compliance to standards and other legal or regulatory requirements using their own technical and human resources. It is a departure from the previous practice of giving to the government the sole responsibility for compliance monitoring. It is based on the recognition on the part of the government that it has no sufficient technical and human resource to conduct compliance monitoring for all industries nationwide. This instrument, therefore, is a consequence of the government's efforts to reach out to the private sector and other project owners or operators to secure their assistance in monitoring compliance to environmental laws and regulations. Under this set-up, industries are required to conduct their own compliance monitoring activities and to submit the monitoring reports to the appropriate offices of the DENR. However, the government is not precluded from conducting its own compliance monitoring from time to time or when a need arises such as due to the filing of a complaint. Environmental monitoring and evaluation, according to Tolentino, "are important phases of law implementation and enforcement calling for adequate facilities and proper guidelines." The goal is "to use environmental data to determine whether the sources of pollution control or natural resources Alan S. Cajes 

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Policies on Energy Efficient and Environmentally Sound Technologies  exploitation are exceeding the acceptable limits, and if they do, the data will serve as rationale for the formulation and enforcement of environmentallyrelated policies, laws, rules and regulations26." The importance of environmental monitoring is shared by the PRIME Project of the DENR. In July 2000, the Project's newsletter stated that: "Environmental monitoring for regulatory purposes is a primary analytical tool in evaluating compliance with environmental standards. The Pollution Control Law, the Philippine EIS System, LLDA's Environmental User's Fee Program, etc. require companies to monitor the environment affected by their operations. We need to monitor from the conceptualization stage of the project or undertaking up to the abandonment phase. And we need to monitor environmental quality or ambient level and from specific sources of possible pollutants for the health and safety of our communities27. Although there is no arguing that environmental monitoring is an important aspect of ecological governance, this important activity is hampered by the lack of technical and human resource capability. According to the PRIME Project: "Problems in environmental management always point to the lack of capacity of regulatory bodies to properly carry out required monitoring activities, resulting into low compliance with environmental standards. This is mainly due to personnel and equipment deficiency. The policy study conducted by the PRIME Project on environmental entrepreneurship identified environmental monitoring as one of the government functions that can favorably be devolved to the private sector28." Economic or Market-Based Instruments Economic instruments are policy tools used to achieve compliance to environmental policies, rules and regulations. According to the Asian Development Bank, these tools either use markets and price signals, such as effluent charges and user fees, or create markets, for instance through the use of tradeable permits, to achieve environmental objectives29. The idea is to translate 26

Ibid., p. 82 PRIME Project, Tech Review, July 2000, Quezon City, no pagination. 28 PRIME Project, Tech Review, July 2000, Quezon City, no pagination. 29 See An Overview of Market-Based Instruments as Economic Incentives for Environmental Management. A paper presented by Lisa C. Antonio during the International Environmental Management Training, on 22 March to 02 April 1999 in Pasay City, Metro Manila and Puerto 27

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Policies on Energy Efficient and Environmentally Sound Technologies  the benefits of sound environmental practice into economic terms that are easily understandable by project owners. Also, most of the economic instruments are basically incentives aimed to entice industries into complying with environmental legislation. The use of economic instruments in environmental management is an offshoot of efforts30 to understand and manage the trade-offs between conventional economic development objectives and environmental goals. It operates on a theory, which according to Henry M. Peskin: "…views the environment as a source of wealth whose value reflects the valuable services provided by the environment. Were these services traded in conventional markets, presumably they would command a positive price reflecting what society would be willing to pay for these services as well as their scarcity. Scarcity is important. If these services were very abundant, they would not command a positive price - in the jargon of economic these services would not be economic."31 The economic instruments for natural protection and natural resources management generally fall under seven categories, namely, property rights, market creation, fiscal instruments, charge systems, financial instruments, liability systems, and bond and deposit refund systems.32 The economic instruments under each category are as follows: Property Rights • • •

Ownership rights -- land titles, water rights, and mining rights Use rights (physical division) -- stewardship, licensing, concession/bidding, and territorial use rights (turfs) Development rights -- patents and prospecting rights Market Creation

• •

Tradeable emission/effluent permits Tradeable catch quotas

Princesa City, Palawan, Philippines. 30 In the Philippines, efforts toward such direction include the Environment and Natural Resources Accounting Project (ENRAP) funded by the United States Agency for International Development (USAID), and the and the United SEEA resource and accounting project implemented by the National Statistical Coordination Board. 31 Environmental Accounting: The Theoretical Foundations of ENRAP. A Paper prepared for the Conference on Resource Accounting and Policy, February 3-4, 2000, The Manila Hotel, Philippines. 32 See Environmental and Natural resources Accounting Project Overview. A paper delivered by Marian S. de los Angeles at the Conference on Resource Accounting and Policy, February 3-4, 2000, The Manila Hotel, Philippines.

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Policies on Energy Efficient and Environmentally Sound Technologies  • • • • • •

Tradeable development quotas/rights Tradeable water share Tradeable water shares Tradeable land permits Tradeable offsets/credits Tradeable transferable development rights

Fiscal Instruments • • • • • • • • • • • • •

Pollution taxes -- effluent and emission taxes Input taxes Product taxes Export taxes Import tariffs Tax differentiation Royalties and resource taxes Land use taxes Investments tax credits Accelerated depreciation Subsidies Property taxes Capital gains tax

Charge Systems • • • • • • • • •

Pollution charges User charges Betterment charges Impact fees Access fees Road tolls Administrative charges Resource protection charges Collection charges

Financial Instruments • • • • • • • • • •

Financial subsidies Soft loans Grants Location/relocation incentives Subsidized interest Hard currency at below equilibrium exchange rate Revolving funds Sectoral funds Eco-funds/environmental funds Green funds

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Policies on Energy Efficient and Environmentally Sound Technologies  Liability Systems • • • •

Legal liability -- non-compliance charges and joint and several liabilities Natural resource damage liability Liability insurance Enforcement incentives

Bonds and Deposit Refund Systems • • • • • • •

Environmental performance bonds Land reclamation bonds Waste delivery bonds Environmental accident bonds Deposit-refund systems Deposit-refund shares Forest management bonds

In the Philippines, the economic instruments explicitly provided by existing policies include the following: •

• • • •

Environmental Funds such as the Environment Revolving Fund, Air Quality Management Fund, Environmental Monitoring Fund, and Environmental Guarantee Fund for the clean-up, environmental rehabilitation and compensation for personal damages; Incentives to industries that install control devices or retrofit their existing facilities with mechanisms that reduce pollution. Incentives shall include tax credits and/or accelerated depreciation deductions, among others; Granting of generous tax, capital repatriation and other incentives for energy projects; Financing for energy conservation projects, and Rationalization of energy prices to reflect the true costs of production and distribution. Information, Education, Communication

The use of information, education and communication (IEC) is important in environmental management because IEC helps to achieve the following: • • • •

Make the stakeholders or those affected by the environmental legislation know their roles and obligations; Make the stakeholders understand why the environmental legislation was passed and why they should comply to such legislation; Enlist support from the stakeholders and the public in terms of ensuring compliance to the legislation, and Minimize potential conflicts that may arise as result of misinformation.

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Policies on Energy Efficient and Environmentally Sound Technologies  IEC can be perceived as a right and as a strategy for gaining the support of the stakeholders. As a right, IEC is something to be fulfilled. It is based on the principle that right actions and right decisions stem from right information. It may be noted, however, that right information is also a function of how such information is communicated to the receiver; hence, the importance of education as a strategy to properly communicate right information. The Philippine Constitution is rather emphatic in stressing the importance of IEC in nation building. Article III, Section 7 of the Constitution provides that the "right of the people to information on matters of public concern shall be recognized. Access to official records and to documents and papers pertaining to official acts, transactions, or decisions as well as to government research data used as basis for policy development, shall be afforded the citizen, subject to such limitations as may be provided by law.” Article II, Section 24 also provides that the "State recognizes the vital role of communication and information in nationbuilding.” Thus, in Article II, Section 28, the fundamental laws provides that subject to "reasonable conditions prescribed by law, the State adopts and implements a policy of full disclosure of all its transactions involving public interest.” That is why, all laws, rules and regulations must be published before they take into effect. It may be noted that the Philippine government operates on the legal dictum, which states that "ignorance of the law excuses no one." Under this principle, any violator of existing environmental legislation cannot defend himself/herself in court by citing ignorance of the law being violated. IEC is also a strategy for gaining the support of the stakeholders. This is particularly true in the case of the EIS System. A lot of proposed projects or undertaking has been shelved because of the failure to secure the support of the stakeholders. This, in turn is largely attributed to a failure in IEC. The Procedural Manual of DAO 96-37, which is the implementing rules and regulations of the PD 1586, specifically requires the social preparation process, which is a series of IEC campaigns to prepare the stakeholders so that they can make an informed decision. Also, in the Environmental Management Plan under the EIS System, project proponents are required to prepare an IEC Plan, which shall be implemented as soon as the project commences. Networking The Philippine Agenda 21 views sustainable development as derived from "an image of society and a shared vision of the development path of that society." It takes off from an understanding of the "state" of Philippine society and proceeds towards an agreed upon development objective. Three key actors define the goal of development, namely, government, business and civil society. Thus, to promote sustainable development, "there must be an interplay of market forces, state intervention, and civil society participation." The recognition of the three key actors points to three essential dimensions of Philippine society -- economy, polity, and culture. These dimensions are the "realms where the key actors are active and from which the actors derive the Alan S. Cajes 

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Policies on Energy Efficient and Environmentally Sound Technologies  substance for their dialogue interaction with each other." In this context, a "harmonious integration of a sound and viable economy, responsible governance, social cohesion/harmony, and ecological integrity" is essential to promote sustainable development. Thus, the "ultimate aim of development is human development now and through future generations." Short of this, development becomes economically 'jobless' and 'ruthless,' culturally 'rootless,' politically 'voiceless,' and ecologically 'futureless.' Of the 15 principles of sustainable development in PA 21, two principles, namely participatory democracy and institutional viability, have direct bearing on networking. The participatory democracy principle recognizes the importance of participation and empowerment of all sectors of society in development decisionmaking and processes. It also advocates intersectoral and multisectoral consensus. In the institutional viability principle, the State declares that sustainable development is a shared, collective and indivisible responsibility which calls for institutional structures that are built around the spirit of solidarity, convergence and partnership between and among different stakeholders. These principles are consistent with the Philippine Constitution, which provides for the people's rights to information and participation. Although the PA 21 and the Philippine Constitution do not define the meaning of networking, nevertheless the two documents provide certain elemental concepts in relation to networking. The first concept refers to the critical role of information and/or communication. This suggests that in any networking relationship, all parties or stakeholders possess sufficient information for them to make an informed decision on matters presented to them. The second concept refers to the participation of the various stakeholders themselves. Here, the first and second concepts fuse because the quality of the stakeholders' participation is directly proportional to the quality of information given to them, including the manner by which such information is communicated. The third concept has something to do with the capability of an institution, whether a national or local institution, to tap the resources of the stakeholders. This concept assumes that the stakeholders do not merely have an interest to promote and protect. It also assumes that they have a valuable contribution to enhance the quality of both the process and outcome of decision making. Networks, in technical terms, are "non-hierarchical social systems which constitute the basic social form" that allows an "inter-organizational coalition to develop."33 Carley and Christie maintains that any networking process generally involves the following steps: • • •


Increase in the level of interaction among organizations; Increase in the load of information on organizations; Emergence of structures of domination or patterns of coalition, and

Michael Carley and Ian Christie, Managing Sustainable Development (London: Earthscan Publications. Ltd., 1992), p. 169

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Policies on Energy Efficient and Environmentally Sound Technologies  •

Development of a dominant ideology (at the cultural level) which is usually accompanied by competing, minority ideologies34.

Networks also exhibit certain features such as the following35: • • • • •

Constellation of interest - the interest of participants in a network vary by service/economic function, territory, client-group and common expertise. Membership - membership differs in terms of the balance between public and private sector; and between political-administrative elites, professions, and clients. Vertical interdependence - intra-network relationships vary in their degree of interdependence, especially the dependence of central government on subnational actors for the implementation of policies. Horizontal interdependence - relationships between the networks vary in their degree of horizontal articulation: that is, in the extent to which network is insulated from, or in conflict with, other networks. Distribution of resources - actors control different types and amounts of resources and such variations affect the patterns of vertical and horizontal interdependence.

Four types of networks can be identified, namely, (a) policy networks that are based on the major functional interests in and of government, (b) issue networks that have many participants and exhibit a limited degree of interdependence, (c) professional networks that cut across policy and issue networks, and (d) producer networks that focus on economic functions, and the relationship between the private and the public sectors36. Networks, however, are not limited to those four types just mentioned. As problems facing public, private and civil society organizations increase in complexity, these organizations are forced "into a range of temporary alliances, formal or informal, with other organizations.37" Carley and Christie describe the capacity of organizations to network with other organizations productively as 'connective' capacity, which often results in "collaborative problem-solving." This trend towards inter-organizational collaboration "fits theories of responses to turbulence" represented by the early organizational analysis of Emery and Trist. It was Trist who suggested that "management will increasingly be undertaken by such task-oriented networks.38" Such action or task-oriented networks are most likely to perform the following functions: •

Regulation of present relationships and activities, establishing ground rules and maintaining value;


Ibid. See Rhodes, RAW, Control and Power in Central-Local Government Relations(Gower, Farnborough, 1981). See also Carley and Christie, p. 169. Ibid., p. 170 Ibid., p. 171 Ibid.


36 37 38

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Policies on Energy Efficient and Environmentally Sound Technologies  • • • • •

Appreciation of emergent trends and activities, developing a shared image of a desirable future; Mutual problem-solving by tapping into the extended range of knowledge, expertise and experience available from members of the network; Infrastructure support - resources, research, information sharing, and support of innovation; Mobilization of resources including finance, political access and support, information and expertise, legal authority and administrative relationships, and Development of a network of external relations for interactive planning and mutual support.39

In the action-centered networks, the degree to which the partner organizations are linked or 'coupled' to each other depends on the "strength of vertical or horizontal ties between organizations, and whether relations are voluntary or mandated."40 Public Participation and Social Acceptability Public participation is giving citizens the opportunity to influence major decisions that affect them. As a process, it provides many opportunities and paths through which decision-makers become aware of the concerns of the affected community. The following are the levels of public participation: • • •

Informing - one way flow information from the proponent to the public Consulting - two-way flow of information between the proponent and the public; provides opportunities for the public to express their views on the proposal Involving/Participating - proponent and the public involved in shared analysis and agenda setting, involved in decision-making through reaching consensus on the main issues and concerns. The objectives of public participation can be summarized as follows:

• • • • • 39 40

Informing the stakeholders about what is proposed and providing them the opportunity for creating a sense of ownership of the proposal; Providing an opportunity for those otherwise unrepresented to present their views and values, therefore allowing more sensitive consideration of mitigative measures and trade-offs; Providing those involved in planning the proposal with an opportunity to ensure that the benefits are maximized and that no major negative environmental impact is overlooked; Providing an opportunity for the public to influence design of the proposal in a positive manner; Increasing public confidence in the decision-makers; Ibid., pp. 171-172 Ibid., p. 172

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Policies on Energy Efficient and Environmentally Sound Technologies  • •

Providing better transparency and accountability in decision-making, and Reducing conflict through the early identification of contentious issues.

Under the EIS System, public participation is the only process that helps promote and acquire social acceptability, which is crucial to the issuance of an ECC for a project or undertaking. It also offers the following added values and benefits: • • • • • •

Helps identify and address concerns of affected groups Focuses planning on issues of concern Provides alternatives for consideration in planning Provides further sources of expertise Reduces level of misinformation and distrust Improves decision-making

Social acceptability, as popularized by the EIS System, is the result of a process that is mutually agreed upon by the stakeholders to ensure that the their concerns are fully considered and/or resolved in the decision-making process for granting or denying the issuance of an ECC. It means the proponent is able to meet all of the relevant and valid issues and match them with corresponding mitigative/enhancement measures together with the available resources to implement the measures and the corresponding agreements and guarantees for the fulfilment of such measures. In evaluating whether a proposed project or undertaking is socially acceptable, the following criteria are used: • • • •

The project should be consistent with plans/programs and policies of the national, regional, and local authorities; The project should be able to contribute to the government’s effort in promoting social equity such that the social benefits outweigh the social cost; The project should be able to provide gainful employment and alternative sources of livelihood, and The project should involve women and vulnerable groups.

For purposes of determining social acceptability, the following broad spectrum of environmental factors and equity issues are considered: •

Ecological and environmental soundness of the proposed project - Examples of proofs that this has been met can include: a) Risk management plan, if applicable b) Environmental management plan with the commitment of the proponent to implement the proposed measures c) Municipal, barangay or provincial resolution endorsing the project d) Endorsement letters from the local NGOs, and POs e) Signed contract between the proponent and project contractor(s) incorporating all the mitigating and enhancement measures in the TOR or scope of work of the contractor(s)

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Policies on Energy Efficient and Environmentally Sound Technologies  f) List of detailed specifications of raw materials and equipment to be used in the project from the different suppliers showing that these are made of environment friendly processes and substances. An example of this would be a statement from the supplier that the fuel to be used has low sulfur content. •

Effective implementation of the public participation process - Examples of proof include: a) Scoping report that has been signed by all key parties and stakeholders’ representatives b) Matrix showing the manner of inclusion of the comments and suggestions of stakeholders in the various aspects of EIA c) Letters of stakeholders signifying interest to participate in the monitoring of the project and/or implementation if the environmental management plan d) Report of the Hearing Officer during the public hearing

With regard to indigenous cultural communities and their ancestral lands, social acceptability may be determined by a prior informed consent obtained from the concerned indigenous cultural group for the utilization of their ancestral land. In the case of mining permits of agreements in areas claimed as ancestral, Section 16, paragraph 2 of the Mining Act provides: “Prior consent refers to prior informed consent obtained, as far as applicable, in accordance with the customary laws of the concerned Indigenous Cultural Community. Prior informed consent should meet the minimum requirements of public notice through various media such as, but not limited to, newspaper, radio or television advertisements, fully disclosing the activity to be undertaken and/or sector consultations wherein the Contractor/Permit Holder/Permittee should arrange for a community assembly, notice of which should be announced or posted in a conspicuous place in the area for at least a month before the assembly: Provided, that the process of arriving at an informed consent should be free from fraud, external influence and manipulations.” •

Resolution of conflicts - Examples of proof include: a) MoU between the disputing or conflicting parties b) Negotiated agreements on conflicts should be firmed up through MOA between the proponent, DENR, LGU, and legitimate stakeholders c) Resettlement and compensation plan, if applicable d) Social development plan, if applicable.

Promotion of social and intergenerational equity and poverty alleviation

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Policies on Energy Efficient and Environmentally Sound Technologies  3.3 Impacts of the Policies to the Promotion of E3ST Introduction The E3ST-related policies all point to the sic utere tuo ut alienum laedas principle, i.e., "one should use his own property in such a manner as not to injure that of another."41 Applied to SMEs, the principle may be stated in this way: SMEs should conduct their operations in such a manner that the negative impacts to the environment are insignificant. Since it is impractical to say that the activities of SMEs will have zero negative environmental impacts, SMEs should ensure that such negative impacts do not violate the basic rights of people, including their property rights. This statement should also cover the commons, or those resources that are not privately owned. A liberal interpretation of the sic utere principle implies that private properties and the commons (or the natural resources, in general) have to be protected from any significant impact that may result from any project or undertaking. This implication basically means that SMEs must use environmentally sound technologies in their operations. And since the use of energy inefficient technologies indirectly causes significant negative environmental impacts, it is not stretching the imagination to assume that SMEs are also required to use energy efficient technologies in their operations. To ensure that the sic utere principle is observed, environmental management professionals and project proponents use EIA as a tool. EIA, as has been shown above is one of the most important pieces of environmental legislation not only in the Philippines but also in other countries. As Principle 17 of the Rio Declaration on Environment and Development states: "EIA, as a national instrument, shall be undertaken for proposed activities that are likely to have a significant adverse impact on the environment and are subject to a decision of a competent national authority." The next section presents the scientific and legal foundations of EIA, which SMEs has to comply with as mandated by the E3ST-related policies. EIA and the Sic Utere Principle EIA serves as the cornerstone of the country's "four major legislation's that form the nucleus of environmental law," namely, the Philippine Environmental Policy (PD No. 1151), Philippine Environment Code ((PD No. 1152), Pollution Control Law (PD No. 984), and the EIA Law (PD No. 1586).42 Indeed, EIA is regarded as an instrument for the development and implementation of environmental law43.



See Black's Law Dictionary, 1930 (6 ed. 1990) See DENR-EMB, Primer on the Environment, no date, p. 30. 43 See "Environmental Assessment as an Instrument for the Development and Implementation of Environmental Law," J. Mayda, Ad Hoc Meeting of Senior Government Officials Experts in Environmental Law, Montevideo, 1981. 42

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Policies on Energy Efficient and Environmentally Sound Technologies  EIA Rules and Regulation In 1996, DENR issued DAO 96-37 or the Revised Implementing Rules and Regulations (IRR) of PD 1586. The revised IRR aims to ensure that environmental considerations are incorporated at the earliest possible stage of project development, strengthen the current procedures for EIA preparation to improve its effectiveness as a planning, regulatory and management tool, and enhance maximum participation in the EIA process to generate social acceptability and ensure the fullest consideration of all environmental impacts. The key features of this IRR are as follows: • • • • • • • • • •

Formalization of the scoping process; Introduction of the accreditation system for EIS preparers, featuring individual experts and institutions44; Changing of Project Description (PD) into Initial Environmental Examination (IEE) following an outline and certain procedures for its preparation; Broadening of the responsibility of project proponents in the implementation of the EIA System by shouldering the responsibility for conflict management, EGF, and contributing to the cost of the EIS review process; Broadening of the participation or roles of the stakeholders in the EIA process through EIA scoping, public participation, and compliance monitoring activities; Strengthening of public participation processes that would ensure proper integration of stakeholders’ concerns, avoid conflicts, and ensure social acceptability; Standardization of the EIS and IEE review procedures by establishing the procedural and substantive review criteria; Strengthening of environmental monitoring through the establishment of multipartite monitoring teams (MMTs); Incorporation of Environmental Risk Assessment (ERA) in the EIS for projects posing significant public risks, and Setting up of the Environmental Guarantee Fund (EGF).

Earlier, the DENR issued DAO No. 11 in 1994, which provides the programmatic compliance procedures within the EIS system45. The policy objectives of DAO No. 11 include the following: • •

Identify environmental constraints and opportunities of natural systems in order to guide the planning and development of industrial projects that have multiple stages or components; Incorporate incentives for industrial siting in regional industrial centers;


This was suspended during the term of DENR Sec. Antonio H. Ceriles. Sec. Ceriles opined that only the Professional Regulatory Commission (PRC) is authorized to accredit the EIS preparers. 45 The implementation and practice of programmatic EIA, however, was shelved for some time primarily due to its prohibitive cost requirements and the lack of experience of the EIS administrators, preparers and reviewers. At present, only the Philippine National Oil Company (PNOC)-Petrochemical Development Corporation is undergoing the programmatic EIA process for its project site in the Province of Bataan.

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Incorporate cost-effective environmental management systems in compliance with environmental standards; Assess the carrying capacity of the natural environment in areas designated for industrial development; Assure environmentally sensitive development of industrial projects and programs; Assess the induced effects on the social and natural environment of concentrated industrialization programs; Streamline the procedures for environmental compliance for industries locating in regional industrial centers; Encourage industries to locate in geographic areas which are environmentally and socially suitable to their activities, and Ensure transparency through wide participation of concerned sectors, especially the local communities, in compliance monitoring of development projects and programs.

Recognizing the importance of EIA, Pres. Fidel V. Ramos issued Executive Order No. 291 in January 1996 entitled "Improving the Environmental Impact Statement System." This presidential order stresses the simultaneous conduct of the environmental impact study and the feasibility study as a planning tool, and establishes in-house Environmental Units in all implementing agencies.

Value of EIA EIA, which is a good tool to plan and manage a project or an undertaking, is a tool that SMEs can use to their advantage for the following reasons: • •

The EIA process promotes better planning because the scrutiny of a project and its alternatives through EIA leads to a more effective and efficient project. The process saves time and money in the long run. By integrating environmental factors in decision-making at the planning stage, business and government avoid expensive and sometimes controversial remedial action afterwards. The process facilitates investment. Conducting an EIA facilitates the gathering of information now required by financial and other institutions that loan money or make investment decisions for major developments. In addition, the process can help long-term investments by determining how resources can best be managed over the long term. EIA keeps business and government in touch. Inputs through public consultation, before plans are finalized and investments are made, can improve community relations and ensure that funds are well invested. As a good management practice, EIA can support future prosperity. Through decisions based on recommendations from the process, there can be more prudent use of resources and a reduction of environmental threats to human health and ecosystems. EIA leads to responsible decisions. Responsible decisions in turn are good for investment, good for the health of the organization, its employees and the

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Policies on Energy Efficient and Environmentally Sound Technologies  community where it operates. As well, responsible decisions sustain and enhance the value of the environment we pass to future generations. According to the United Nations Environment Programme (UNEP)46, EIA has the following core values, and guiding and operating principles: Core Values • • •

Sustainability - the EIA process will result in international safeguards Integrity - the EIA process will conform to agreed standards Utility - the EIA process will provide balanced, credible information for decisionmaking

Guiding Principles: • • • • • • • •

Participation - appropriate and timely access to the process for all interested parties Transparency - all assessment decisions, and their bases, should be open and accessible Certainty - the process and timing of assessment should be agreed in advance and followed by all participants Accountability - decision-makers are responsible to all parties for their actions and decisions under the assessment process Credibility - assessments are undertaken with professionalism and objectivity Cost-effectiveness - the assessment process and its outcomes will ensure environmental protection at the least cost to society Flexibility - the assessment process should be able to adapt to deal efficiently and effectively with any proposal or decision-making situation Practicality - the information and outputs provided by the assessment process are readily usable in decision-making.

Operating Principles EIA should be applied: • • • •

To all development project activities likely to cause potentially significant adverse impacts or add to actual or potentially foreseeable cumulative effects As a primary instrument for environmental management to ensure that impacts of development are minimized, avoided or rehabilitated So that the scope of review is consistent with the nature of the project or activity and commensurate with the likely issues and impacts On the basis of well defined roles, rules and responsibilities for key actors EIA should be undertaken:


For additional information, see United Nations Environment Programme (UNEP), EIA Training Resource Manual. 1996.

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Policies on Energy Efficient and Environmentally Sound Technologies  • • • • •

Throughout the project cycle, beginning as early as possible in the concept design phase With clear reference to the requirements for project authorization and followup, including impact management Consistent with the application of “best practicable” science and mitigation technology In accordance with established procedures and project-specific terms of reference, including agreed timelines To provide meaningful public consultation with communities, groups and parties directly affected by, or with an interest in, the project and/or its environmental impacts EIA should address, whenever necessary or appropriate:

• • • •

All related and relevant factors, including social and health risks and impacts Cumulative and long-term, large-scale effects Design, locational and technological alternatives to the proposal being assessed Sustainability considerations including resource productivity, assimilative capacity and biological diversity EIA should result in:

• • •

Accurate and appropriate information as to the nature, likely magnitude and significance of potential effects, risks and consequences of a proposed undertaking and alternatives to it The preparation of an EIS that presents information in a clear, understandable and relevant form for decision-making, including reference to qualifications, confidence limits in the predictions made Ongoing problem solving and conflict resolution to the extent possible during the application of the process EIA should provide basis for:

• • •

Environmentally sound decision-making in which terms and conditions are clearly specified and enforced The design, planning and construction of acceptable development projects that meet environmental standards and resource management objectives An appropriate follow-up process with requirements for monitoring, management, audit and evaluation that are based on the significance of potential effects, the uncertainty associated with prediction and mitigation, and the opportunity for making future improvements in project design or process application.

EIA Criteria

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Policies on Energy Efficient and Environmentally Sound Technologies  Under the Procedural Manual of DAO 96-37, the DENR-EMB and the regional offices will determine whether the project or undertaking has significant environmental impacts using the following criteria: • •

• •

Location Criteria - the activity shall conform with duly approved or proposed land use plan of the area; Technology Criteria - the activity shall employ the use of appropriate technology that will not require the use of toxic and hazardous materials; will not produce or require the disposal of waste materials that will pose serious health hazards; or will not generate significant amount of organic solid wastes; Size Criteria - the activity/structure’s total floor areas shall not be more than three thousand (3,000) square meters in urban areas and ten thousand (10,000) square meters in rural areas. It shall have no more than three stories including basement floors; Raw effluent and discharge (no mitigative measures and treatment) Criteria - the effluent or discharges of the activity shall conform with the emission and effluent standards established by DENR (e.g., DENR DAO Nos. 14, 34, 35) regardless of quantity, volume or amount; Social Acceptability Criteria - no serious complaints are expected from neighboring establishments/facilities, and The nature of the activity shall not pose significant environmental impact as determined by the EMB and DENR Regional Office.

Clearly, the criteria used to determine the significance of an environmental impact cover the various environmental laws, rules and regulations. Thus, SMEs are obliged, scientifically and legally speaking, to observe the EIS system requirements, which imply the use of energy efficient and environmentally sound technologies.

EIA in the ICC Business Charter for Sustainable Development47 The International Chamber of Commerce (ICC) promulgated its Principles of Environmental Management under the Business Charter for Sustainable Development as a way of promoting sound environmental practice among its members. The following principles are not only related to EIA but also to E3ST: •

• •


Corporate priority. To recognize environmental management as among the highest corporate priorities and as a key determinant for sustainable development; to establish policies, programmes and practices for conducting operations in an environmentally sound manner. To integrate these policies, programmes and Integrated management. practices fully into each business as essential element of management in all its functions. Process of improvement. To continue to improve corporate policies, programmes and environmental performance, taking into account technical developments, scientific understanding, consumer needs and community

See Richford Welson and Andrew Gouldson, 1993. pp. 2-3

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• • •

• •

• •

expectations, with legal regulations as starting point; and to apply the same environmental criteria internationally. Employee education. To educate, train and motivate employees to conduct their activities in an environmentally responsible manner. Prior Assessment. To assess environmental impacts before starting a new activity or project and before decommissioning facility or leaving site. Products and services. To develop and provide products or services that have no undue environmental impact and are safe in their intended use, that are efficient in their consumption of energy and natural resources, and that can be recycled, reused, or disposed of safely. Customer advice. To advice, and where relevant, educate customers,. distributors and the public in the safe use, transportation, storage and disposal of products provided; and to apply similar considerations to the provisions of services. Facilities and operations. To develop, design and operate facilities and conduct activities taking into consideration the efficient use of energy and materials, the sustainable use of resources, the minimization of adverse environmental impact and waste generation, and the safe and responsible disposal of residual wastes. Research. To conduct or support research on the environmental impacts of raw materials, products, processes, emissions and wastes associated with the enterprise and on the means of minimizing such adverse impacts. Precautionary approach. To modify the manufacture, marketing or use of products or services to the conduct of activities, consistent with scientific and technical understanding to prevent serious or irreversible environmental degradation Contractors and suppliers. To promote the adoption of these principles by contractors acting on behalf of the enterprise, requiring improvements in their practices to make them consistent with those of the enterprise; and to encourage the wider adoption of these principles by suppliers. Emergency preparedness. To develop and maintain, where significant hazards exist, emergency preparedness plans in conjunction with emergency services, relevant authorities and the local community, recognizing potential transboundary impacts. Transfer of technology. To contribute to the transfer of environmentally sound technology and management methods throughout the industrial and public sectors. Contributing to the common effort. To contribute to the development of public policy and to business, global and intergovernmental programmes and educational initiatives that will enhance environmental awareness and protection. Openness to concerns. To foster openness and dialogue with employees and the public, anticipating and responding to their concerns about the potential hazards and impacts of operations, products, wastes or services, including those of transboundary or global significance. Compliance and reporting. To measure environmental performance; to conduct regular environmental audits and assessments of compliance with company requirements, legal requirements and these principles; and

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Policies on Energy Efficient and Environmentally Sound Technologies  periodically to provide appropriate information to the Board of Directors, shareholders, employees, the authorities and the public. The widespread recognition that environmental protection must be among the highest priorities of every business encouraged the ICC to promulgate these principles to "help business around the world improve its environmental performance." And the 16 principles presented above constitute an important aspect of sustainable development in the sense that "economic growth provides the conditions in which protection of the environment can best be achieved, and environmental protection, in balance with other human goals, is necessary to achieve growth that is sustainable48."

Conclusion In its 1997 report entitled "Our Common Future," the World Commission on Environment and Development stress that sustainable development, in essence, is a process of change in which "the exploitation of resources, the direction of investments, the orientation of technological development, and institutional change are all in harmony and enhance both current and future potential to meet human needs and aspirations49." As a strategy that aims to promote harmony among human beings and between humanity and nature, sustainable development requires the following: • • • • • • •

A political system that secures effective citizen participation in decisionmaking; An economic system that generates surpluses and technical knowledge on a self-reliant and sustained basis; A social system the provides for solutions for the tensions arising from disharmonious development; A production system that respects the obligations to preserve the ecological base for development; A technological system that can search continuously for new solutions; An international system that fosters sustainable patterns of trade and finance, and An administrative system that is flexible and has the capacity for selfcorrection50.

The first five requirements of sustainable development are directly related to EIA in the sense that EIA can be used as a tool to fulfill such requirements. Now, if EIA is an important tool for environmental management, sustainable development, and the development and implementation of environmental laws, EIA also has a significant impact to the promotion of E3ST to SMEs in the sense that E3ST is a basic requirement under the EIS system. SMEs are expected to use


See ICC, Business Charter for SD, vol. 3, No. 1, April 1996 World Commission on Environment and Development, p. 46 50 Ibid., 63 49

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Policies on Energy Efficient and Environmentally Sound Technologies  E3ST in their operations. And in view of this, efforts have to be exerted to promote E3ST to SMEs.

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Chapter V Policy Guidelines in Promoting E3ST to SMEs "Careless technology, commercial greed, political indifference, and the needs of the poor for the basic necessities of life, together with a rapid growth in human population, have resulted in a situation further time should be lost in elevating sustainable development to a global ethic." - M. S. Swaminathan

1. Introduction The country's sustainable development operational framework1 is based on economic, social and environmental dimensions. At the project level, the framework uses the following six tests of sustainability that define how sustainable development can be implemented: • • • • • •

Economic Viability - Everybody is better off and nobody is worse off. Project will benefit the greater majority and will not cause serious harm or permanent disbenefits to the affected minority; Ecological Viability - Ecological functions of the environment and regeneration capacity of natural resources will not be significantly hampered nor altered; Technological Viability - Environment-friendly technology will be adopted in the process of production; Political Viability - People participate in the planning and implementation of the project. People own and share the project benefits; Socio-Cultural Viability - Core values, beliefs, and world view of a community which are consistent with human ecological principles (e.g. life-giving, peacekeeping), will be enhanced and not opposed, and Institutional Viability - Responsible institutions have the capability to sustain development activities2

Of the six criteria of sustainability, the technological viability criterion is important because it serves as the immediate foundation of the need to promote E3ST to SMEs. It has two parameters, with their respective descriptors. The first parameter is the capability of technology to manage residuals. Its descriptors include the capability of the technology to control air, water and land pollution, 1

IEMSD. Sustainable Development Operational Framework: A People’s Framework. IEMSD Programme Office, First Issue, 1996 series. 2 All these criteria must be satisfied to make a project sustainable. Any violation of the criteria would render a project or undertaking as inconsistent with the principle of sustainable development.

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Policies on Energy Efficient and Environmentally Sound Technologies  and to properly dispose of solid, toxic and hazardous wastes. The second parameter refers to the adoption of environment friendly technologies. The descriptors of this parameter include the technology's capability to minimize the generation of waste, recycle and reuse waste, provide economic incentives for the use and/or manufacture of pollution-control equipment and establishment of waste treatment facilities. The socio-cultural criterion is also relevant to E3ST promotion, particularly its parameter on promoting environmental awareness, inculcating environmental ethics and supporting environmental actions. The descriptors of this parameter include the following: effecting change in values and attitudes through environmental education, encouraging and supporting eco-activism, creating an atmosphere for green consumerism, and developing human resources to support environmental management. These four descriptors can be used as guides in developing and implementing policy guidelines to promote E3ST to SME. 2. Policy Guidelines 2.1 Framework for E3ST Promotion The basic framework that may be used to promote E3ST to SMEs covers four elements, namely, policy, goals, plans, and implementation strategies. Policy refers to a clear statement of intent of the project or program to promote E3ST to SMEs. This policy is then translated into specific goals or what the project or program intends to achieve as results given a particular period of time. To ensure that the specific goals are accomplished within a given time frame, plans have to be formulated. These plans normally contain information such as activities, objective, success indicators, institutional or networking requirements, human resource requirements, financial requirements, etc. The implementation strategies refer to the means by which the plans will be implemented. These strategies include the following: environmental assessment; information, education and communication (IEC); public participation; legislation, enforcement and compliance, and the use of market-based instruments or economic instruments. These strategies have been discussed in the previous chapter. But a few words about environmental assessment may be in order. Environmental assessment through research and development is essential to a successful E3ST promotion program because it provides data and information about the nature and complexity of the problem to be addressed. The goals and plans, in fact, are dependent on the quality of information and data available. Also, the use of implementation strategies would require accurate information and data about the problem to be addressed and the conditions that sustain such a problem. Through environmental assessment, stakeholders and other interested groups will also be properly identified, thus improving the chance of securing public participation.

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Policies on Energy Efficient and Environmentally Sound Technologies  Proposed Framework for E3ST Promotion





Environmental Assessment

Information, Education and Communication

Public Participation

Legislation, Enforcement and Compliance

Economic Instruments

2.2 Requirements to Operationalize the Framework The proposed framework for E3ST promotion to SMEs is important but not a sufficient instrument to ensure that the program will succeed. Other requirements have to be fulfilled to ensure the sustainability of the program. These requirements are discussed below. Improving Project and Programmatic Environmental Assessment The use of project and programmatic environmental assessment3 as a planning and regulatory tool under the EIS system still needs continuous improvement to make it an effective tool for environmental management. Important issues related to SMEs such as the high cost of conducting EIA, and preparing and reviewing the EIS must be addressed so that SMEs will not find it expensive to comply with the requirements of the EIS system. The recent innovation introduced in the EIS system by EMB -- the use of checklists for certain projects -- may be used to address this concern. But other innovative solutions have to be introduced to ensure a high-level of compliance. For instance, EMB can process the data and information contained in the EISs of projects that were issued ECCs and publish the results in the internet or in book form. The processed 3

The current EIA practice in the country includes the use of two related tools, namely, environmental risk assessment (EnRA), social impact assessment (SIA), and health impact assessment (HIA).

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Policies on Energy Efficient and Environmentally Sound Technologies  data, which can provide ecological profiles of many areas in the country, will surely help SMEs in the siting of their respective projects. Also, the availability of ecological profiles will significantly reduce the cost of conducting EIA and preparing the EIS. It may be recalled that PD No. 1586 requires the Ministry of Human Settlements to prepare the proper land or water use pattern for the environmentally critical projects or environmentally critical areas. The DENR, which is now responsible for the implementation of the EIS System, still has a long way to go to fulfill the requirements of the law. Use of Environmental Technology Assessment Environmental technology assessment (EnTA) may be defined as the systematic study of the effects on society that may occur when a technology is introduced, extended, or modified with emphasis on the impacts that are unintended, indirect, or delayed. It is a powerful tool, which is useful in promoting E3ST, but one that is not formally introduced in the country. EnTA is important because it is more efficient to address the related impacts of a technology before such technology is adopted. This is particularly significant in view of economic globalization, which also implies the globalization of technologies. Under this condition, the dumping of unwanted technologies into developing countries like the Philippines would be difficult to prevent if the government does not have a way of determining whether such technologies are harmful or not. EnTA is also needed to deliver E3ST or those technologies that perform better throughout the technology cycle compared to other technologies. It helps, therefore, in encouraging the use of eco-efficient technologies, which have the lowest resource consumption, emissions and effluents, and waste. Use of Strategic EIA Another environmental management tool, which is not yet used in the country, is strategic environmental assessment (SEA), which is a natural development of the EIA philosophy. SEA is the application of EIA to more strategic tiers of decision making, namely, the formulation of policies, plans and programs. It involves the formalized, systematic and comprehensive process of evaluating the environmental impacts of policies, plans or programs and their alternatives, including the preparation of a written report of the findings of that evaluation, and using those findings in publicly accountable decision making4. Although there are difficulties in using SEA such as the lack of technical know-how and experience, the value of SEA cannot be understated. For one, it can help in making sure that environmental policies, laws, rules and regulations can be implemented actually and will not create more problems in the long run. A case in point is the enactment of the Clean Air Act and its Implementing Rules 4

See Therival et al. 1992

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Policies on Energy Efficient and Environmentally Sound Technologies  and Regulations. Other sectors like those in energy and business sectors are complaining because the requirements of the Act are quite expensive to fulfill, especially by SMEs. Issues like these would have been properly addressed with the use of SEA. Promoting EMS to LGUs The Local Government Code of 1991 provides for the promotion of the autonomy of local government units (LGUs) to ensure their fullest development as self-reliant communities and make them more effective partners in the pursuit of national development and social progress. Such policy effectively places LGUs in the forefront of translating the national environment policy into actual practice. Under the Code, an LGU is defined as a “body politic and corporate endowed with powers to be exercised by it in conformity with law. As such, it shall exercise powers as a political subdivision of the national government and as a corporate entity representing the inhabitants of its territory.” Its functions, among others, include the following: • • • • • • • • • • •

Ensure and support the preservation and enrichment of culture; Promote health and safety; Enhance the right of the people to a balanced ecology; Encourage and support the development of appropriate and self-reliant scientific and technological capabilities; Improve public morals; Enhance economic prosperity and social justice; Promote full employment among their residents; Maintain peace and order; Preserve the comfort and convenience of the inhabitants; Discharge the devolved functions and responsibilities of national agencies and offices, and Provide basic services and facilities

Environmental Responsibilities of LGUs As a body politic, LGUs share with the national government, particularly the Department of Environment and Natural Resources (DENR), the responsibility of managing and developing the environment and natural resources within their territorial jurisdictions. Under Department Administrative Order No. 30, Series of 1992, which provides the guidelines for the transfer and implementation of DENR functions devolved to the LGUs, the devolved functions, programs and projects include the following: • • •

Forest management Protected areas and wildlife Environmental management

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Policies on Energy Efficient and Environmentally Sound Technologies  • •

Mines and geo-sciences development, and Land management

Such functions, however, have to undertaken within the framework of Philippine Agenda 21, which is the country’s blueprint for operationalizing the sustainable development principles embodied in the Rio Declaration and adopted by the United Nations Conference on Environment and Development in 1992. In addition to their political duties and responsibilities, LGUs, as corporate entities, also have products (ordinances, programs, projects, etc.), services (primary health care, basic education, etc.) and activities (construction of roads, bridges and other infrastructure) that have significant impacts to the environment. As such, LGUs have corporate environmental responsibilities in terms of ensuring that the impacts of their operations will not cause significant negative changes to the quality and quantity of their environment. The environmental responsibilities of LGUs -- which are both to enforce and observe the environmental policies, laws, rules and regulations – necessarily place LGUs in the front line of environmental protection and enhancement. It is, therefore, an urgent need to build up the capabilities of LGUs to meet such responsibilities.

Use of EMS in Local Governance An increasing number of local governments worldwide have adopted the Environmental Management System (EMS), which is in consonance with the International Environmental Management Standards under ISO 14000. The objectives for implementing an EMS include the following: • • • •

To provide an assessment of the state of the environment within the territorial jurisdiction of LGUs; To identify how the actions of LGUs directly affect the environment; To identify how the activities of LGUs indirectly affect the environment, primarily via policy implementation, and To make recommendations as to how LGUs could improve their environmental performance

Based on the experiences of local governments in Australia, Japan and the United Kingdom, a competently designed and properly implemented EMS can help LGUs in: • • • • • • •

Improving environmental performance; Increasing work efficiency or productivity; Integrating their various functions and activities; Simplifying their administrative procedures; Defining roles, responsibilities and authorities; Promoting community awareness on environmental protection; Allowing greater operational control;

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Policies on Energy Efficient and Environmentally Sound Technologies  • • •

Promoting holistic approach to environmental management; Improving local government-community relations, and Reducing environmental risks

If LGUs adopt and implement the EMS, they are in a better position to require all industries, including SMEs, to install EMS to ensure that their operations and activities are environmentally sound. In effect, the promotion of EMS to LGUs also reinforces efforts to promote E3ST to SMEs. Promoting EMS for SMEs The promotion of EMS to SMEs is a laudable program although it is hindered by the lack of funds to install and maintain an EMS. As a matter of fact, only one SME in the country was certified under ISO 14000 in 1998. To address this problem, the United Stated States Agency for International Development funded the Industrial Initiatives for a Sustainable Environment (IISE) to help install an EMS to some 400 SMEs in Visayas and Mindanao. The basic aim of the project is to reduce the pollution of coastal areas as a result of the operations of SMEs. But there are many more SMEs throughout the country that do not receive technical and financial assistance as regards the installation and maintenance of EMS. These SMEs are not even aware of the potential negative environmental impacts of their operations (see Case Study in Chapter I). The Clean Air Act requires the submission of proof of an approved EMS in the form of an EMS audit report prepared by the person or party responsible for the facility or an EMS audit report prepared by a third party EMS auditor. SMEs, especially those whose operations are environmentally pollutive, will be forced to install an EMS. The question is: Can the SMEs meet this legal requirement? There is no arguing that SMEs should install and maintain an EMS. This, study, however, proposes the following approaches to address the problem of lack of capability on the part of SMEs to install an EMS, which is certified under ISO 14000, in the short term: • •

• • •

Establish an organization of SMEs to facilitate the advocacy campaign on the importance of EMS; Develop the capability of SMEs to use environmental management tools and approaches such as Green Productivity, EIA, Environment and Energy Audit so that they can measure their environmental performance and at the same time realize the cost-saving opportunities provided by a well-installed EMS; Develop the capability of SMEs to install their respective EMS; Promote self-regulation of SMEs in terms of declaring self-compliance to the EMS standards, and Promote intra and inter-SME auditing of compliance to EMS standards.

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Policies on Energy Efficient and Environmentally Sound Technologies  These approaches can be done in the sort-term so that SMEs, which cannot afford to install and maintain an EMS right away, can effectively reduce their pollution, as well as realize the economic benefits of using E3STs. Formulation of SME Agenda 21 To promote self-regulation by the SMEs in terms of complying with the legal requirements, there is an opportunity for SMEs to establish a nationwide organization that can formulate its own Agenda 21. This is in consonance to the call of the United Nations Commission on Sustainable Development for business to integrate environmental criteria into its purchasing policies, design more efficient products and processes, increase the life-spans for durable goods, improve its after-sales service, reuse and recycle, and promote sustainable consumption through advertising, marketing and product information. Use of Creative Legal Marketing Tolentino opines that the "the Philippines has a fairly sophisticated corpus of pollution control legislation… These legislations are amply supported by rules and regulations to carry out the aims and purposes of the different legislations5." The problem, however, is the wide gap between the statutes and their implementation. In the language of Oposa: "The Philippines has one of the most voluminous bodies of law in Asia. The presence of these laws however, has not prevented the reduction of the country’s forest cover from about 60 percent fifty years ago, to the now critical state of 10 percent. Neither has it prevented the destruction our coral reefs; presently only 5 percent of our reefs are in good condition. Illegal fishing methods continue as does slash-and-burn farming. Due to the heightened economic pace of the Philippines, industrial pollution is and will continue to be a problem in the country." "The Philippine government has enacted It approximately 118 environment-related laws6. would seem that there is sufficient, if not superfluous, environmental law in both substance and form in the Philippines… To repeat, the Philippine environmental law is thorough and complete. The level of 5

Tolentino., p. 64-65 According to Oposa, the basic environmental laws of the country are the following: The Philippine Environmental Policy, PD No. 1151 (1977); The Philippine Environment Code, PD No. 1152 (1977); National Pollution Control Law, PD No. 984 (1976); Environmental Impact Statement System, PD 1586 (1978); Fisheries Decree of 1975, PD No. 704 (1975); Forestry Reform Code, PD No. 705 (1975); Toxic Substances and Hazardous and Nuclear Wastes Law, Rep. Act No. 6969 (1190); National Integrated Protected Areas System, Rep. Act No. 1786; Philippine Water Code, PD No. 1067 (1978); Sanitation Code, PD No. 825 (1975). 6

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Policies on Energy Efficient and Environmentally Sound Technologies  implementation, however, suffers in the sickbed of non-compliance."7 Oposa also explains that law "is a tool of understanding by which human society conducts itself." It aims for the common good. The law, however, is ineffective unless the target market or consumers of the law are not aware of the provisions of the law. Thus, the need to convince the consumers of the law "of the need for such law and must be 'sold' to the policy objective of the law, i.e. the reason behind the law, the ratio legis."8 The current practice of selling the law is in terms of enforcement rather than through voluntary compliance and implementation. Thus, the current practice relies heavily on the use of "sanctions and the use of 'force' to coerce, albeit legally, the modification of behavior. For example, to discourage a manner of behavior, criminal penalties are imposed for fishing by dynamite, the burning of forestland, or the indiscriminate dumping of wastes."9 To properly sell the law, Oposa proposes the following principles of effective environmental law implementation:10 •

First principle. "A law is an agreement of minds, a social contract. Because the law is an agreement, the participants must full understand and appreciate the reason behind, and the need for, the law. In sociological terms, this is the “social product” and the “common good” which the law seeks to promote. Voluntary compliance is possible only when those whose conduct is sought to be regulated or modified fully understand the reason for the law and thereby appreciate its value. If they understand that the social product and policy is desirable, then a mental and emotional agreement is reached." Second principle. "Legal marketing, or selling the law, may be used to promote voluntary compliance. The legitimacy and effectiveness of a law is in large part dependent on publicizing the law. As business marketing sells a product, law sells a mode of conduct. Thus, just as in commercial marketing, where advertising and promotions are techniques used to sell a consumer product, so must creative legal marketing use proactive methods to sell the social good and the mode of conduct desired." Third principle. "The manner of implementing the law must be socio-culturally sensitive. Implementation must take into account the particular social and cultural characteristics of the people who are the target market of the law. This is particularly true in regions such as Asia that may have some commonalities in their socio-cultural traits." Fourth principle. "The law must contain as aspect of punishment in order to modify behavior and to serve as a deterrent. People must be aware that


Legal Marketing of Environmental Law. A paper prepared for the Participant's Kit of the Foundation Course on Environmental Management offered by the Development Academy of the Philippines, 1997. 8 Ibid. 9 Ibid. 10 Ibid.

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Policies on Energy Efficient and Environmentally Sound Technologies  deviating from conduct, which promotes social good carries a penalty. Penal law, however, must be reserved only for the particularly hardheaded. Furthermore, penal law is effective as a deterrent only if its application is swift, painful and public." Oposa's approach to implement environmental legislation is an innovative contribution to the country's efforts to ensure compliance to existing laws, rules and regulations. But there are other issues that need to be addressed, in addition to the culture-sensitive manner of legal marketing. One example is the propensity of low-income countries to adopt the laws of high-income countries. According to Tolentino: "Statutes modeled on the legislation of more developed countries turn out to be unsuitable to the political, cultural and economic realities - hence, they are often observed in the breach rather than in compliance11." Thus, beyond culture, there are other considerations that must be taken into account in environmental lawmaking. One basic consideration, from the perspective of SMEs, is the prohibitive cost of meeting the legal requirements as exemplified by the EIS system.

Use of Economic Instruments One way of promoting compliance to environmental policies, laws, rules and regulations is the use of economic instruments. Although the Philippine government is currently using such instruments, there is still an opportunity to fully use such mechanisms, especially in terms of generating income for implementing agencies like the DENR, LLDA and the LGUs.


Ibid., p. 51

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References Andelson, Robert V. Commons Without Tragedy: Protecting the Environment from Overpopulation--A New Approach. London: Shepherd Walwyn and Savage, and Maryland: Burnes and Noble, 1991. Angell, D.J.R., Comer, J.D., and Wilkinson, M.L.N., eds. Sustaining Earth: Response to the Environmental Threat. Hampshire and London: Macmillan Academic and Professional Ltd., 1990. Barde, Jean-Philippe, and Pearce, David W. Valuing the Environment: Six Case Studies. London: Earthscan Publications Ltd., 1991. Baumol. William J. and Oates, Wallace E. The Theory of Environmental Policy. 2nd ed. Cambridge, New York, Port Chester, Melbourne and Sydney: Cambridge University Press, 1988. Biswas, Asit K., Khoshoo, T.N., and Koska, Ashok. Environmental Modeling for Developing Countries. London and New York: Tycolly Publishing, 1990. Boland, R.G.A. General Environmental Management. Labour Office, 1986.

Geneva: International

Boormann, F. Herbert and Keller, Stephen B., eds. Ecology, Economics, Ethics: The Broken Cycle. New haven and London: Yale University Press, 1991. Brown, Jennifer, ed. Environmental Threats: Perception, Analysis and Management. Great Britain: Belhaven Press, 1989. Brown, Lester R., Flavin, Christopher, and Poste, Sandra. Saving the Planet: How to Shape an Environmentally Sustainable Global Economy. London: Earthscan Publications, Ltd., 1992. Carley, Michael and Christie, Ian. Managing Sustainable Development. London: Earthscan Publications, Ltd., 1992. Castillo, Norberto, ed. Nature, Science and Values Readings. Tomas University Press, 1988.

Manila: Santo

Chiras, Daniel D. Environmental Science: Action for a Sustainable Future (4th Edition). California: The Benjamin/Cummings Publishing Co., Inc., 1994. Cooper, David. E., and Palmer, Joy A. The Environment in Question: Ethics and Global Issues. London and New York: Routledge, 1992.

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Policies on Energy Efficient and Environmentally Sound Technologies  Crombie, A. C. Scientific Change Historical Studies in the Intellectual, Social, and Technical Conditions for Scientific Discovery and Technical Invention, from Antiquity to the Present. New York: Basic Books, Inc., 1963. Cronon, William. ed., Uncommon Ground. Rethinking the Human Place in Nature. New York and London: W.W. Norton and Company, c. 1996. Daly, Herman. Toward a Steady-State Economy. San Franscico: W.H. Freeman and Co., c. 1973. Dror, Yehezkel. The Capacity to Govern, Report to the Club of Rome (Executive Summary). Ciculo de Lectores, July 1994. Ehrlich, Paul R., and Ehrlich, Anne H. Population, Resources, Environment: Issues in Human Ecology. San Francisco: W.H. Freeman and Company, 1970. Engel, J. Ronald and Engel, J. Gibb, eds. Ethics of Environment and Development: Global Challenge and International Response. London: Belhaven Press, 1990. Falkman, Edwin. Sustainable Production and Consumption: A Business Perspective. Word Business Council for Sustainable Development, n.d. Feliciano, Myrna S., Environmental Law in the Philippines. Institute of International Legal Studies, University of the Philippines Law Center, 1992 National Environmental Protection Council, Philippine Environmental Law Comments and Materials vols. 1&2, 1981 and 1983 editions. Gordon, Scott. The History and Philosophy of Social Science. London and New York: Routledge, 1991. Hayward, Tim. Ecological Thought, An Introduction. UK: Polity Press, c. 1994. Hemming, Daniel H. and Mangun, William R. Managing the Environmental Crisis: Incorporating Competing Values in Natural Resource Administration. Durhane and London: Duke University Press, 1989. Hoffman, W. Michael, Frederick, Robert, and Petry, Edward S. Jr., eds. Business, Ethics, and the Environment: The Public Policy Debate. New York, Westport, Connecticut, and London: Qurorum Books, 1990. Hopson, Janet L. and Potlethwait, John H. The Nature of Life. United States of America: McGraw-Hill Publishing Co., 1989. IUCN. The World Conservation Strategy: Living Resource Conservation for Sustainable Development. Gland, Switzerland: IUCN, 1980. Alan S. Cajes 

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Policies on Energy Efficient and Environmentally Sound Technologies  Jacobs, Michael. The Green Economy: Environment, Sustainable Development, and the Politics of the Future. London: Pluto Press, 1991. Kakonen, Jyrki, ed. Perspectives on Environmental Conflict and International Relations. London: Earthscan Publications, Ltd., 1992. Korton, Robert. Getting to the 21st Century: Voluntary Action and the Global Agenda. West Hatford, CT.: Kumarian Press, 1990. Kula, Erhun. Economics of Natural Resources and the Environment. London, New York, Tokyo, Melbourne and Texas: Chapman and Hall, 1992. Kumar, Ranjit and Murck, Barbara. On Common Grounds: Managing HumanPlanet relationships. Toronto: John Wiley and Sons, 1992. Logan, John R. and Molotch, Harvey L. Urban Fortunes. The Political Economy of Space. Berkeley, Los Angeles and London: University of California Press, 1987. Macneill, Jim, Winsemius, Dieter and Yakushiji, Taizo. Beyond Independence: The Meaning of the World’s Economy and the Earth’s Ecology. New York and Oxford: Oxford University Press, 1991. Matthews, Freya. The Ecological Self. London: Routledge, 1991. Meadows, Donella H., Meadows, Dennis L., and Randers, Jorgen. Beyond the Limits: Global Collapse or a Sustainable Future. London: Earthscan Publications Ltd., 1992. Odum, Eugene P. Ecology and Our Endangered Life-Support Massachusetts: Sinauer Associates, Inc. Publishers, 1989.


Parnwell, Michael J.G. and Bryant, Raymond L. eds., Environmental Change in South-East Asia. People Politics and Sustainable Development. London and New York, Routledge, 1996. Policy Studies Division, Planning and Policy Studies Office, Department of Environment and Natural Resources, A Compilation of Environment and Natural Resources Policy Issuances CYs 1990, 1993, 1994. Porter, Gareth and Brown, Janet Welsh. Global Environmental Politics. Boulder, San Francisco and Oxford: Westview Press, 1991. Ramani, K.V., Peter Hills, and Grace George, eds. Burning Questions: Environmental Limits to energy Growth in Asian-Pacific Countries during the 1990s. Kuala Lumpur, Asian and Pacific Development Center, c. 1992

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Policies on Energy Efficient and Environmentally Sound Technologies  Reid, David. Sustainable Development An Introductory Guide. London: Earthscan Publications, Ltd., 1995. Repetto, Robert. World Enough and Time. New Haven, Conn.: Yale University Press, 1986. Slater, Frances. Societies, Choices, and Environments: Issues and Enquiries. London: Collins educational, 1991. Schmiheiny, Stephan with the Business Council for Sustainable Development. Changing Course. London: The MIT Press, 1992. Shraeder-Frechette, K. S. Science Policy, Ethics and Economic Methodology: Some Problems of Technology Assessment and Environment-Impact Analysis. (Dordrecht, Boston and Lancaster: D. Reidel Publishing Co., 1985. Swedish Environmental Advisory Council. On the General Principles of Environmental Protection: Swedish Government Official Reports 1994:69. Stockholm, 1994. Stavins, Robert N. Environmental Protection: Visions of Governance for the Twenty-First Century, John F. Kennedy School of Government, Harvard University, July 23, 1998. Turner, Kerry R., ed. Sustainable Environmental Management Principles and Practice. Boulder, Colorado: Westview Press, 1988. World Commission on Environment and Development (WCED). Our Common Future. Oxford and New York: Oxford University Press, 1987. World Resources Institute. The 1993 Information Please Environmental Almanac. Boston and New York: Houghton Mifflin Co., 1993. ADDITIONAL REFERENCES Asian Development Bank. Environmental Planning and Management. Manila: 1986. __________. Asian Development Review, vol. 15, no. 1, 1997. Development Academy of the Philippines-Resource Center for Environment and Sustainable Development. Participants' Kit for the Course on Managing the Environmental Impact Assessment Process, November 10-16, DAP Conference Center, Tagaytay City, 1997. _________. Participants' Kit for the Course on Managing the Environmental Impact Assessment Process, March 9-15, DAP Conference Center, Tagaytay City, 1998. Alan S. Cajes 

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Policies on Energy Efficient and Environmentally Sound Technologies  _________. Highlights of the Workshop on EIS Scoping, Review and Compliance Monitoring, June 29-July 1, DAP Conference Center, Tagaytay City, 1998. _________. Participants' Kit for the Orientation Course on Environmental Legislation and the Philippine EIS System, 1998. DENR-EMB. Department Administrative Order (DAO) No. 37, Series of 1996. _________. DAO-96-37 Procedural Guidelines (Draft Second Version), 1998 United Nations Environment Programme (UNEP). EIA Training Resource Manual, 1996. UNEP-International Environmental Technology Centre. Proceedings of the Environmental Management Training implemented by the Development Academy of the Philippines in Manila and Pasay City, 1999.


US Environmental Protection Agency (EPA) Sourcebook. World Bank Environmental Assessment Sourcebook.

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About the Author Alan S. Cajes is Fellow of the Development Academy of the Philippines (DAP) where he serves as Vice President and Managing Director of the Center for Sustainable Human Development, Faculty Member and Action Plan and Project (Thesis) Adviser of the Master in Public Management Program, and in-house Resource Person on quality assessment, anti-corruption/ integrity development, project management, strategic and results-based planning, green productivity, renewable energy, waste management, and disaster risk reduction-climate change adaptation. He finished a Bachelor of Arts major in Philosophy, with cum laude, at Holy Name University (formerly Divine Word College) in Tagbilaran and a Master of Arts major in Philosophy, with magna cum laude, at the Pontifical and Royal University of Santo Tomas, Manila. He has conducted or led more than 30 action-research projects and has lectured to various audiences in the country on topics related to environmental management and sustainable development. He is now working on an online depository of reference materials on Philippine history and studies.

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Discusses the policy environment in the Philippines on energy efficient and environmentally sound technologies.