As the region gears up to meet ambitious economic goals, supplying energy needs is putting strains on resources, the environment and regulatory mechanisms. We explore some key regional developments in energy laws.



The Philippines

Singapore/SE Asia


The overarching legislative framework relating to the electricity sector in India is provided by the Electricity Act, 2003, which governs the generation, transmission, distribution and trading of electricity, including the tariff for sale of electricity.

The institutional framework under the Electricity Act, 2003, comprises electricity regulatory commissions at the central and state levels, with appeal provision provided to an Appellate Tribunal for Electricity (APTEL) which has been created under the Electricity Act, and from APTEL appeal to the Supreme Court of India.

Piyush Joshi
Partner at Clarus Law Associates in New Delhi
T: +9111 4546 9100

In 2019 the Supreme Court clarified that it would not interfere with the decisions of APTEL, or with those of any of the regulatory commissions established under the Electricity Act, unless a specific question of law is presented. It further clarified that it would not interfere with issues such as elements of tariff determination that do not involve questions of law.

The upstream segment of the natural gas sector in India (i.e., exploration and production, or E&P) is not governed by any specific statute, but instead falls under the overall executive authority of the government of India and an executive body, namely, the Director General of Hydrocarbons (DGH), which oversees the implementation of E&P operations. However, some aspects of upstream operations are controlled by certain laws such as the Oilfields (Regulation and Development) Act, 1948, and the Petroleum Act, 1934.

The role of liquefied natural gas (LNG) in the natural gas sector has been steadily increasing, and in September 2019 up to 57% of the total demand for natural gas in India (i.e., 2,728 million metric standard cubic metres, or MMSCM, out of total demand of 4,754 MMSCM) was met through regasified LNG.

RV Anuradha
Partner at Clarus Law Associates in New Delhi
T: +9111 4546 9100

The import of LNG is not regulated and is undertaken under the open general licence regime. Although LNG terminals are required to be registered with the Petroleum and Natural Gas Regulatory Board (PNGRB), the regulatory body under the Petroleum and Natural Gas Regulatory Board Act, 2006 (PNGRB Act), no rules providing the manner of registration have been notified to date. However, entities engaged in construction/installation/operation of LNG terminals should notify the PNGRB to ensure due compliance.

The natural gas transmission and distribution segment is regulated by the PNGRB, which has statutory jurisdiction over natural gas pipelines and city gas distribution (CGD) networks. The regulatory framework mandates the development of CGD networks only through grant of authorization to a single entity for specifically demarcated geographical areas. It vests the authorized entity with marketing exclusivity for eight years, and infrastructure exclusivity for the economic life of the network (typically considered as 25 years).

Sumiti Yadava
Partner at Clarus Law Associates in New Delhi
T: +9111 4546 9100

The authorizations for CGD networks are awarded by the PNGRB, usually through a competitive bid process, unless the government of India issues a specific policy direction to vest authorization with specific entities for the purposes of enabling overall economic development. Such a policy direction has been issued only once, in 2018, when the government of India directed government company GAIL India to be vested with authorizations to develop the CGD network along the route of a specific natural gas pipeline in order to ensure viability of the pipeline.

The pricing of natural gas, other than gas produced by government-controlled companies, or by companies under specific contractual provisions with the government, is not regulated.

FDI in the energy sector

Foreign direct investment (FDI) up to 100% under the automatic route is allowed in the power sector in respect of any investor seeking access to generation, distribution or transmission of electricity, both in respect of conventional and renewable energy. The only exception to this is the atomic energy sector. FDI in power exchanges under the Central Electricity Regulatory Commission (Power Market) Regulations, 2010, is restricted to 49% under the automatic route.

Energy sector trends

In the LNG and natural gas sector, the trend since 2016 has been to shift towards short and medium-term contracts, rather than long-term contracts, and this has continued in the past year. A significant development in India in 2018-2019 has been the increasing potential for distributed LNG projects.

What was earlier limited to or possible by pipeline connectivity is now possible by smaller-scale and lower capital-intensive distributed LNG projects, which have enabled the development of virtual pipelines by fleets of LNG trucks, and conversion of larger commercial vehicles to LNG-based fuel.

Another key growth area has been the CGD sector. The provision of marketing and infrastructure exclusivity within specific geographical areas has been a material factor for generating interest from the private sector in CGD projects.

With the completion of the ninth CGD bidding round in 2018, and the 10th CGD bidding round in February 2019, CGD networks will now be developed across 136 geographical areas (GAs) across 27 states of India.

These bidding rounds saw the participation of large private sector entities such as Adani and Torrent, which won the maximum number of GAs. Public sector undertakings such as the Indian Oil Corporation, GAIL India, Bharat Petroleum Corporation and Hindustan Petroleum Corporation also participated and won several GAs.

The CGD segment is presently seeing significant FDI from multinational companies into India’s energy sector, with French multinational Total undertaking a transaction to acquire controlling voting rights and management of Adani Gas Limited (AGL), thereby making AGL, upon completion of the transaction, a subsidiary of Total for a consideration of about US$600 million.

AGL is an entity undertaking only CGD network development, operation and maintenance, and has authorizations over an aggregate of 19 GAs. AGL also has a 50:50 joint venture with Indian Oil Corporation, called Indian Oil Adani Gas Private, which holds CGD authorizations for another 19 GAs.

The acquisition by Total of AGL will provide the French multinational with control in the retail gas sector in 15 states, 71 districts and 68 towns of India, and about 7.5% of India’s population. The Total-AGL transaction can be said to roughly value each GA authorized for CGD development at about US$21 million.

Another important development in the CGD sector was the judgment in January 2019 of the Supreme Court of India in the case of Adani Gas Limited v Union of India and Ors, where the court directed the PNGRB to consider the provisions of “deemed authorization” for entities undertaking development of the CGD network prior to 1 October 2007.

Although this point of law is still pending consideration, it provides a shot in the arm for the few entities that were undertaking CGD network development prior to 1 October 2007.

Stranded natural gas plants

Based on the discovery of large natural gas reserves in KG D-6 basin, by a consortium led by Reliance Industries, which was accepted by the DGH and the government, the government had invited proposals for development of natural gas-based power generation capacity.

However, various reasons including technical difficulties in the extraction of the natural gas from the deep sea reservoir resulted in a shortfall in natural gas production, and consequently natural gas-based power generation capacity of 27,123MW, including plants that were commissioned, as well those ready for commissioning, became stranded and non-operational, with 14,000MW of power generation capacity out of that total not having any gas supply at all.

One of the reasons for this is because regasified LNG is not a viable source of natural gas for power generation, particularly since state electricity regulatory commissions have refused to allow a passage through of dollar-indexed LNG fuel prices into the price of electricity.

Although the government implemented a short-lived scheme for supporting operations of such stranded power plants to enable servicing of interests for lenders to such plants, this was of little benefit. One of the main concerns for projects in this sector in the past couple of years has been the fear of stressed assets being declared as non-performing assets (NPAs).

The direction issued by the Reserve Bank of India on 12 February 2018 (RBI direction) prevented further restructuring of debt and directed banks to consider initiating insolvency proceedings. However, undertaking corporate insolvency resolution processes under the Insolvency and Bankruptcy Code, 2016 are not considered viable as there is no market for taking over such assets without a viable source of natural gas.

The Supreme Court of India, in its judgment in April 2019, set aside the RBI direction on the ground of being arbitrary, which provided much needed relief against the imminent scrapping and liquidation of established natural gas generation capacities.

However, until such time as domestic natural gas production increases, which is likely by 2022 with the revised filed development plan of KG D-6 expected to bear results, there will be a need to implement a policy to support the operation of the stranded gas-based power generation capacity.


Clarus Law Associates
3rd Floor, Vijaya Building
17 Barakhamba Road, Connaught Place
New Delhi 110001
Tel: +9111 4546 9100


Energy is a vital and indispensable resource for any economy. For the Philippines, which is one of the most rapidly developing countries in Southeast Asia, the direction is to seek alternative rather than conventional sources of energy to meet its needs as a non-oil producing country.

At present, the primary source for power generation in the Philippines is coal, which accounts for 49.6% of the total power mix, followed by renewable energy (RE) at 24.6%, natural gas (11.8%), geothermal energy (10.9%), and oil-based sources (3.8%). The Philippines is heavily reliant on imported energy, which accounts for 49% of the total energy mix.

Against this backdrop is the steady increase in Philippine energy consumption. This is apparent from the jump in 2016, from 32.2 million tons of oil equivalent (MTOE) to 33.9 MTOE in 2017. The Asian Development Bank estimates that by 2035 the energy consumption of the Philippines could reach 49 MTOE. The growth may be attributed primarily to the transportation sector, which constitutes 34.9% of total energy consumption, while the residential sector accounts for 27.1%, the industry sector 23.55%, the commercial sector 13%, and the agricultural, fishery and forestry sectors 1.5%.

Sustainable energy efforts

Patricia A. O. Bunye
Partner at Cruz Marcelo & Tenefrancia in Manila
T: +63 2810 5858

In order to secure a more sustainable power supply, the Philippines has tried to reduce its dependence on coal by diversifying its energy sources, particularly by developing its RE sector. The Philippine government has introduced different plans throughout the years to promote RE as a means of attaining national energy self-sufficiency, energy security, and environmental sustainability.

In 2011, the Department of Energy (DOE) introduced its Energy Reform Agenda, which encouraged the development of the RE sector and directly addressed the depletion of the Malampaya gas field, which is currently the only source of natural gas in the country. Malampaya’s reserves are projected to decrease significantly by 2020, and to be completely depleted by 2027.

The DOE’s Philippine Energy Plan (PEP) 2017–2040 outlines expected changes and sets goals for the energy sector by 2040. Some of the key items on the government’s agenda are: (1) increase RE installed capacity to at least 20,000 megawatts (MW); (2) increase reserves and production of local oil, gas and coal; (3) deliver a quality, reliable, affordable and secure power supply; and (4) provide nationwide electricity access.

Among the related developments is the issuance by the DOE of the implementing rules for the Green Energy Option Programme (GEOP) in 2018. The GEOP provides an option for consumers to source their supply from RE producers, and its implementation is expected to enhance competition among the different energy suppliers.

The DOE, through its Renewable Energy Management Bureau, is likewise exploring means to revitalize the RE sector with new issuances, such as:

  1. The Omnibus Guidelines Governing the Award and Administration of Renewable Energy Service Contracts and the Registration of Renewable Energy Developers;
  2. The Renewable Energy Market Rules;
  3. The Guidelines Governing the Issuance of Operating Permits for Renewable Energy Suppliers Under the GEOP, which is expected to be issued before the end of 2019;
  4. Enhancement to Net Metering for RE Policies;
  5. Renewable Energy Safety, Health and Environment Rules and Regulations Code of Practice;
  6. Guidelines on the Duty-Free Importation and Monitoring of Utilization of RE Machineries, Equipment, Materials and Spare Parts;
  7. Operationalization Guidelines for the Collection, Remittance and Utilization of RE Trust Fund; and
  8. A National RE Programme for 2020-2040.

Aside from the above-mentioned DOE issuances, other significant laws and regulations have been enacted. First, the Energy Virtual One-Stop Shop (EVOSS) Act was passed into law by the Philippine Congress during the first quarter of 2019, and was soon followed by the issuance of DOE Department Circular No. DC2019-05-0007, the Implementing Rules and Regulations (IRR) of the EVOSS Act.

The passage of the law and its IRR is expected to streamline the permitting process of power generation, transmission and distribution projects through an online platform called EVOSS. It is envisioned that the EVOSS Act will improve the country’s energy use by reducing power generation charges and encourage investment in the country’s RE industry.

The Philippine Congress also enacted Republic Act No. 11285, the Energy Efficiency and Conservation Act, which aims to regulate the use of energy-efficient technologies in buildings. It seeks to standardise energy efficiency and conservation measures by providing both fiscal and non-fiscal incentives for engaging in best practices for energy efficiency and conservation.

Further, the president issued Executive Order (EO) No. 30 creating the Energy Investment Coordinating Council (EICC) in 2017. EO No. 30 gives priority to energy projects of national significance (EPNS) by establishing “a simplified approval process and harmonizing the relevant rules and regulations of all government agencies involved in obtaining permits and regulatory approvals” in cases of EPNS. Interested applicants or proponents must justify “in a clear and unequivocal manner” how their projects are in consonance with the goals and objects of the PEP 2017-2040 in order for the EICC to issue certificates of EPNS.

Various bills strengthening and promoting the use of RE are currently pending with the Philippine Congress, including:

  1. House Bill No. 01481, An Act Creating the Solar Energy Development Authority and Appropriating Funds Therefore, which has been pending with the Congressional Committee on Government Reorganization since 24 July 2019;
  2. House Bill Nos. 02099 and 02427, An Act Strengthening the Energy Regulatory Commission by Expanding and Streamlining its Bureaucracy, Upgrading Employee Skills, Augmenting Benefits, and Appropriating Funds Therefore; and An Act to Enhance the Governance Structure of the Energy Regulatory Commission. Both are pending with the Congressional Committee on Energy since 29 July 2019; and
  3. Senate Bill No. 990, An Act to Strengthen the Jurisdiction and Power of the Department of Energy Over Petroleum Pipeline Operations and For This Purpose Provide a Petroleum Pipeline Code to Prescribe Standards for the Design, Construction, Operation and Maintenance and Abandonment of Liquid Petroleum Pipelines and Appropriating Funds Therefore, and for Other Purposes, which has been pending with the Senate’s Energy Committee since 2 September 2019.

Looking forward

In addition to the RE efforts of the Philippines, the development of liquefied natural gas (LNG) has also been favoured. A Notice to Proceed issued to First Gen Corporation to build an LNG import terminal within its power plant complex in the Southern Luzon province of Batangas was signed by DOE Secretary Alfonso Cusi in March 2019, and was granted EPNS status by the government.

On 31 July 2019, a 25-year franchise was granted to Solar Para Sa Bayan Corporation, allowing it to use RE-powered microgrids to provide electricity to unserved/underserved areas in selected provinces. It is the first solar energy company to be granted such a franchise, and could be the first step towards addressing a major national problem, considering that as much as 10.4% of Philippine households, or an estimated 12 million Filipinos, lack access to electricity.

There also remains a need to establish a more cost-effective energy mix to bring down the Philippines’ oppressive cost of electricity. The nation’s heavy reliance on imported coal is seen as one of the major causes of the runaway price of electricity.

The national government has been exploring all possibilities to address this, including the use of nuclear energy. The DOE’s Cusi recently stated that “nuclear energy holds much promise for our national interest, especially in light of our collective quest to implement our long-term energy plans”.

However, the national government has not issued an official position on nuclear energy. This may be attributed to continuing strong resistance to it due to accidents in other countries involving nuclear facilities.

Challenges to the local development of nuclear energy also remain unresolved, which include public acceptance, lack of political will, possible high infrastructure costs and the question of how to dispose of nuclear waste.


Cruz Marcelo & Tenefrancia
One Orion, 11th Avenue corner University Parkway
Bonifacio Global City 1634
Metro Manila, Philippines
PO Box 3525 Makati Central
Tel: +632 8810 5858
Fax: +632 8810 3838


With the energy sector in a state of transition due to an increased emphasis on the shift to renewable sources, Singapore is, to a large extent, at the epicentre of energy thought leadership in the Southeast Asian region.

The key body responsible for energy regulation in Singapore is the Energy Market Authority (EMA), a statutory board under Singapore’s Ministry of Trade and Industry with the aims of: (1) promoting effective competition in the energy market; (2) ensuring a reliable and secure energy supply; and (3) developing a dynamic energy sector.

Babita Ambekar
Partner at DWF in Singapore
T: +65 9186 8236

The EMA has adopted a fairly progressive stance and actively collaborates with industry to further Singapore’s energy agenda. While Singapore’s energy needs pale in comparison to that of its neighbours, the domestic focus is very much on increasing energy efficiency, leveraging new technology, and trying to create a level playing field for non-government participants.

Electricity generation in Singapore is largely fuelled by imported natural gas, which contributes to 95% of the country’s needs. Imported LNG is regasified for electricity generation, and the EMA’s Power System Control Centre plays a critical role in Singapore’s gas-to-electricity journey. From a regulatory perspective, various regulations, codes of practice and licences implemented by the EMA govern the gas industry, including the Gas Network Code, which came into effect in 2008.

The opening up of the retail electricity market by the Singapore government from 1 April 2018 has been viewed as a key step towards facilitating a more competitive utilities sector. Aside from the actively consumer-led dynamic that this initiative is intended to enable, the open electricity market has encouraged customers to consider their usage footprint with a view to adopting an energy-efficient approach.

The take-up has been encouraging, with 40% of households switching to buying electricity from a retailer of their choice as of 31 August 2019. The leveraging of smart metering and similar energy management measures further this plan, in addition to more innovative concepts such as the creation of a digital marketplace to facilitate the trading of green credits, and peer-to-peer energy trading.

While Singapore may focus its initiatives on deriving better energy efficiency, the Southeast Asian region constitutes a number of economies that require significant energy consumption in order to support economic growth.

Although there is a willingness to embrace the transition to renewables in a considered way, the ability of developing nations to migrate to a largely renewable model is constrained by their short-term need for accelerated growth.

Therefore, a number of Southeast Asian economies must look to carefully balance their reliance on conventional and renewable energy sources. As an additional dynamic, the environmental lobby is particularly strong in a number of Southeast Asian jurisdictions, and energy majors have encountered difficulties in getting projects off the ground due to local opposition.

Obtaining financing for coal-fired power projects has become a significant challenge following the development of the new Sector Understanding in accordance with Organization for Economic Co-operation and Development commitments. Conversely, while there is considerable financing interest in low-carbon and renewable offerings, the ability to find bankable renewable opportunities remains a challenge.

Having committed to the Paris Agreement along with a number of its Southeast Asian counterparts, Singapore has set aggressive targets to address the threat of climate change. Several initiatives have been implemented to that end, including enhancements to the Energy Conservation Act (ECA), which require users to appoint an energy manager, report and track energy use and emissions, and submit energy efficiency improvement plans to the National Environment Agency.

More specifically, the carbon tax scheme put in to effect by the Carbon Pricing Act, 2018, which came into operation on 1 January 2019, implemented amendments to the ECA to impose taxes on certain greenhouse gas emissions of facilities in Singapore.

In parallel, tax incentives such as the Accelerated Depreciation Allowance Scheme allow the early write-off or depreciation of capital expenditure on energy-efficient or energy-saving equipment to replace older, less efficient equipment, and the Investment Allowance – Energy Efficiency Scheme allows an additional 30% investment allowance for energy-efficient investments against taxable income.

In addition to the implementation of policies to encourage the adoption of cleaner energy in Singapore, the government launched the SolarNova Programme to help promote and aggregate demand for solar photovoltaics (PV) across government agencies, thereby helping to drive the growth of Singapore’s solar industry. Government-supported R&D initiatives to address intermittency issues by leveraging battery storage technology have also been encouraged with the aim of boosting the viability of solar energy as a solution of choice.

Outside of Singapore, Southeast Asian jurisdictions are implementing regulations to facilitate the future of energy transformation. However, to address matters of supply and demand there have also been moves to manage development. For example, in a recently issued notification, Vietnam identified that feed-in tariffs would be replaced by competitive auctions for ground-mounted solar projects. Feed-in tariffs will, however, still apply for rooftop solar and certain pre-approved ground-mounted projects.

Inconsistent implementation of energy regulations in Indonesia has somewhat hampered the development of renewable energy projects and there is likely a need for a material review of policy if Indonesia is to meet its target of having 23% of its electricity generated from renewable sources by 2025.

Malaysia enacted its Renewable Energy Act about 10 years ago in order to encourage investment in the renewables sector. Reforms involved the introduction of feed-in tariffs, but this and the few other initiatives that have been undertaken have not yet achieved the outcome that might have been hoped. The Malaysian government will, however, now launch a Renewable Energy Transition Roadmap 2035, with the objective of raising the share of renewables in the Malaysian market to 20% by 2025.

Finally, along with evolving energy dynamics, the development of the sharing economy and the push by governments across the region to focus on the development of electric mobility solutions, there is considerable interest in the establishment of infrastructure to support the implementation of clean public transportation systems.

In a region where the demand for oil, largely for the purpose of serving regional transport needs, is set to grow from the current 6.5 million barrels per day to 9 million bpd by 2040, according to the International Energy Agency, regional governments are driving this agenda in a material way, with initiatives to facilitate the operation of electric public transportation and the building of corresponding infrastructure set to high priority.

Singapore has already taken significant strides on this front and entered into an agreement with a European entity to develop charging infrastructure for electric buses that it intends to start putting on the road from 2020. The authorities have also supported wider initiatives to facilitate a network of charging stations across the country for electric cars.

There will undoubtedly be further refinement of regulation in the Southeast Asian region to address the transitionary needs of a progressively diverse energy ecosystem. In this context, Singapore is likely to continue to play an important role as an innovator, facilitator and legislator in the sector.


9 Raffles Place
Level 58 Republic Plaza
Singapore 048619
Tel: +65 6823 1365
Fax: +65 6823 1377

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