FACTS:

In February 2006, the Subic Bay Metropolitan Authority (SBMA) and Taiwan Cogeneration Corporation (TCC) signed a Memorandum of Understanding (MOU) to build a power plant in Subic Bay to supply power to the Subic Bay Industrial Park (SBIP). By July 2006, they signed another MOU for a coal-fired power plant on 20 hectares in Sitio Naglatore, Subic Bay Freeport Zone, with a 10-hectare ash pond area. TCC intended to lease the land for 50 years. In April 2007, SBMA’s Ecology Center issued an Environmental Compliance Certificate (ECC) for the project, now involving TCC's subsidiary, Taiwan Cogeneration International Corporation (TCIC). TCC assigned its project rights to Redondo Peninsula Energy, Inc. (RP Energy) in June 2008, and an addendum to this effect was signed.

RP Energy engaged GHD Pty, Ltd. for an Environmental Impact Statement (EIS) and ECC application from the Department of Environment and Natural Resources (DENR). However, in August 2008, the Olongapo City Council opposed the coal-fired plant, urging alternative energy. In December 2008, the DENR issued an ECC. RP Energy later included additional components in the plant design, and in 2010, entered into a Lease and Development Agreement (LDA) with SBMA for the land.

Requests to amend the ECC followed, first in July 2010 to include additional components, and later in May 2011 to change the plant design from 2x150-MW to 1x300-MW. Local opposition continued with resistance from the Zambales Provincial Government and the Olongapo City Barangay League. The DENR approved the amendments.

In July 2012, Teodoro A. Casiño and others filed for a Writ of Kalikasan seeking to halt the RP Energy project, alleging environmental harm and procedural lapses in securing LGU approvals and an ECC. The Supreme Court issued the Writ and referred the case to the Court of Appeals. In September 2012, the ongoing litigation progressed. Meanwhile, RP Energy requested another ECC amendment for a 2x300-MW plant. Various stakeholders, including local governmental units and experts, presented arguments, with ongoing opposition highlighting potential health and environmental harm.

The legal proceedings included multiple submissions, approval processes, and assessments of the plant’s impact, showcasing a complex interplay of environmental, procedural, and jurisdictional issues. The case involves detailed legal scrutiny on environmental laws, compliance certifications, and the balance of local and national interest in development projects.

ISSUES:

1. Whether the Casiño Group was able to prove that the construction and operation of the power plant will cause grave environmental damage.

   • Sub-issues:

     • The alleged thermal pollution of coastal waters, air pollution due to dust and combustion gases, water pollution from toxic coal combustion waste, and acid deposition to aquatic and terrestrial ecosystems that will be caused by the project.

     • The alleged negative environmental assessment of the project by experts in a report generated during the social acceptability consultations.

     • The alleged admissions of grave environmental damage in the EIS itself of the project.

2. Whether the ECC is invalid for lack of signature of Mr. Luis Miguel Aboitiz, as representative of RP Energy, in the Statement of Accountability of the ECC.

3. Whether the first and second amendments to the ECC are invalid for failure to undergo a new environmental impact assessment (EIA) because of the utilization of inappropriate EIA documents.

4. Whether the Certificate of Non-Overlap, under Section 59 of the IPRA Law, is a precondition to the issuance of an ECC and the lack of its prior issuance rendered the ECC invalid.

5. Whether the Certificate of Non-Overlap, under Section 59 of the IPRA Law, is a precondition to the consummation of the Lease and Development Agreement (LDA) between SBMA and RP Energy and the lack of its prior issuance rendered the LDA invalid.

6. Whether compliance with Section 27, in relation to Section 26, of the Local Government Code (i.e., approval of the concerned sanggunian requirement) is necessary prior to the implementation of the power plant project.

7. Whether the validity of the third amendment to the ECC can be resolved in this case.

RULING:

1. The Casiño Group failed to substantiate its claims that the construction and operation of the power plant will cause grave environmental damage. The evidence presented did not show that the alleged environmental impacts would occur. The Casiño Group's witnesses lacked technical expertise and did not provide convincing testimony. Conversely, RP Energy provided adequate expert testimony refuting the allegations.

2. The ECC should not be invalidated on the ground of lack of signature in the Statement of Accountability as the particular circumstances showed substantial compliance with the requirement through a later submission of a certified true copy of the ECC with the required signatures.

3. The first and second amendments to the ECC are valid. The DENR's procedure requiring an EPRMP for the first amendment and a PDR for the second amendment was in compliance with DAO 2003-30 and the Revised Manual, and the environmental impact assessments they conducted were adequate for the proposed changes.

4. The ECC does not fall within the license or permit contemplated by Section 59 of the IPRA Law. The absence of a CNO prior to the issuance of the ECC does not invalidate the ECC.

5. Although the CNO is ideally obtained prior to the LDA, the particular circumstances of this case, including later compliance, do not warrant invalidating the LDA between SBMA and RP Energy.

6. The implementation of the project is not subject to the prior approval of the concerned sanggunian’s requirement under Section 27 of the Local Government Code due to the special jurisdiction and administrative powers granted to SBMA under RA 7227.

7. The issue of the validity of the third amendment to the ECC cannot be resolved in this case as it was not included in the set issues for the preliminary conference, thus addressing it would violate the right to due process of RP Energy.

PRINCIPLES:

• In environmental litigation, it is crucial that claims be substantiated by competent and credible evidence, especially when expert testimony is required to establish the facts.

• Procedural due process must be observed, and issues that develop unexpectedly must be adequately addressed with sufficient opportunity for both parties to present their arguments.

• Governmental and administrative procedures must balance practical considerations with the need for thorough environmental assessments.

• Statutory requirements in environmental and indigenous peoples' laws must be followed to ensure the protection of rights and interests, but procedural compliance can sometimes be substantial rather than strict, depending on circumstances.

• Specific jurisdictions and agencies created by law, such as the SBMA, can have unique administrative powers that can restrict or supersede general provisions of other laws.