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WHEREAS, Republic  Act  No.  9136,  otherwise  known  as  the  Electric  Power Industry Reform Act of 2001 (EPIRA), declares among others the following policy of the State:

(a)  Ensure  the  quality,  reliability,  security  and  affordability  of  the  supply  of electric power;

(b)  Ensure transparent  and reasonable  prices of electricity in a regime of Free and   fair   competition   and   full   public   accountability   to   achieve   greater operational and economic efficiency and enhance the competitiveness of Philippine products in the global market;

(c)  Enhance the inflow of private capital and broaden the ownership base of the power generation, transmission and distribution sectors; and

(d)  Protect  the  public  interest  as  it  is  affected  by  the  rates  and  services  of electric utilities and other providers of electric power.

WHEREAS,  Section  23  of  EPIRA  provides  that  all  Distribution  Utilities  (DUs) shall have  the obligation  to supply  electricity  in the least-cost  manner  to their Captive  Market,  subject  to  the  collection  of  retail  rate  duty  approved  by  the Energy Regulatory Commission (ERC);

WHEREAS, on 05 December 2003, the DOE issued Department Circular No. DC2003-12-011 entitled “Enjoining All Distribution Utilities to Supply Adequate, Affordable, Quality and Reliable Electricity,” which reiterated the state policy that all  DUs  must  henceforth  take  cognizance  and  assume  full  responsibility  to forecast,  assure  and  contract  for  the  supply  of  electric  power  within  their respective franchise areas to meet their obligations as a DU particularly to their Captive Market;

WHEREAS,  adequate  and  proper  power  supply  contracting  through  a transparent  procedure  ensures  electricity  demand  is met, while electricity  end- users is protected  from unnecessary  exposure  in the volatility of spot prices in the Wholesale Electricity Spot Market (WESM);

WHEREAS, the DOE and ERC recognize the adoption of competitive  selection as a policy  that will encourage  investments  in the power  generation  business thereby  ensuring  electric  power  supply  availability  in  a  regime  of  transparent process in securing Power Supply Agreements (PSAs), which is an integral part of the power sector reform agenda;

NOW THEREFORE, pursuant to their respective  mandates  under Republic Act No. 9136, the DOE and the ERC resolve to jointly adopt the following:

Section 1. Competitive Selection Process. Consistent with their respective mandates,  the  DOE  and  ERC  recognize  that  Competitive  Selection  Process (CSP)  in  the  procurement   of  PSAs  by  the  DUs  engenders   transparency, enhances security of supply, and ensures stability of electricity prices to captive electricity  end-users  in the long-term.  Consequently,  by agreement  of the DOE and  ERC,  the  ERC  shall  issue  the  appropriate  regulations  to  implement  the same.

Section 2. Effectivity. This Joint Resolution shall take into effect immediately following its publication in at least two (2) newspapers of general circulation and shall remain in effect until otherwise revoked.

Signed this 20th of October 2015 at Metro Manila, Philippines.

	For and by Authority of the Energy Regulatory Commission:
(SGD) ZENAIDA Y. MONSADA Secretary Department of Energy	(SGD) JOSE VICENTE B. SALAZAR Chairperson Energy Regulatory Commission