Preamble
WHEREAS, it is the desire of the Government to effect changes and reforms in the social, economic, and political structure of our society; WHEREAS, detailed studies have clearly emphasized the very close correlation between consumption of energy and gross national product. Electric power, wherever, introduced, stimulates the growth of industry and the economy in general; WHEREAS, electrification of the entire country, one of the primary concerns of the Government in order to bring about the desired changes and reforms, can be hastened by rationalizing the distribution of electricity; WHEREAS, rationalization, which implies the adoption of all measures necessary to obtain the maximum benefit at the minimum expense, can be achieved by: Establishing island grids and integrating power generating systems. Consolidating electric distribution franchise systems. The existence of small franchise systems impede the progress of total electrification, as such small and isolated systems are antithetical to the economies of scale. Implementing the area coverage concept, which will allow the construction of lines to thinly settled areas which are most costly to electrify, provided that the losses from these lines can be reasonably absorbed by the more profitable lines; WHEREAS, under Republic Act No. 6038, dated August 4, 1969, Presidential Decree No. 40 and Letter of Instruction No. 38, both dated November 7, 1972, the National Electrification on an area coverage basis; to set up cooperatives for the distribution of power; and to determine privately-owned public utilities which should be permitted to remain in operation; and WHEREAS, to attain total electrification in the most effective and efficient manner, there is a need to further strengthen and make more flexible the organizational structure of the National Electrification Administration by converting it into a corporation, wholly-owned and controlled by the Government possessed with borrowing authority and corporate powers; NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Republic of the Philippines, by virtue of the powers vested in me by the Constitution as Commander-in-Chief of all the Armed Forces of the Philippines, and pursuant to Proclamation No. 1081, dated September 21, 1972, and General Order No. 1, dated September 22, 1972, as amended, do hereby repeal Republic Act No. 6038 and do hereby decree, order and make as part of the law of the land the Charter of the National Electrification Administration, which reads as follows: