PROPOSED LOCAL LEGISLATION

Authors: Hon. Wilfredo Jude A. Diokno and Hon. Angelina F. Balatero
Date Filed: March 17, 2026

This revised 2026 version of the proposed Naga City Net Zero Carbon Policy Ordinance has been significantly expanded from the 2025 draft. This proposed revised ordinance establishes a legal and institutional framework to transition Naga City toward a Net Zero future. It mandates the creation of a localized Measurement, Reporting, and Verification (MRV) system to track greenhouse gas emissions across all sectors, including transport. The measure also introduces a Local Carbon Offset and Emission Trading System (ETS) that prioritizes city-based projects, turning farmers and MSMEs into active climate partners rather than just regulated entities. Managed by the newly formed Naga City Net Zero Council, the policy uses a three-year phased rollout to build local capacity without imposing financial costs on the city government.

Highlights of the Revised Proposed Ordinance

1. Key Policy Enhancements

The 2026 ordinance transitions from a general policy to a more robust “enabling legal framework”.

• “Local First” Carbon Credits: A new mandatory requirement forces Naga City businesses to prioritize purchasing carbon credits from local projects before they can source them from outside jurisdictions.

• Transport Sector Integration: The MRV system now specifically targets transportation. It mandates fuel consumption reporting for public utility vehicles and large fleets during franchise or permit renewals.

• Adaptive Governance: Section 3.3 and Section 8 now explicitly state that the ordinance avoids “over-specification”. This allows the Net Zero Council to adjust reporting thresholds and enforcement based on actual “institutional readiness” and MSME capacity.

2. The Naga City Net Zero Council

The Council’s authority has been broadened to act as the primary decision-making body for technical implementation.

• Expanded Composition: Members include the City Mayor (Chair), the SP Environment Committee Chair (Co-Chair), City ENRO (Secretariat), and representatives from the Metro Naga Chamber of Commerce and Industry (MNCCI) and the Naga City People’s Council .

• New Powers: The Council now has the authority to:

  • Accredit private entities as Local Carbon Project Developers.

  • Oversee Public-Private Partnerships (PPP) for carbon sequestration projects.

  • Develop simplified reporting mechanisms specifically for MSMEs to reduce their compliance burden.

3. Implementation Roadmap

The ordinance maintains a three-year phased rollout to allow for capacity building :

• Year 1: Establishing the city-wide carbon baseline (covering Scopes 1, 2, and 3) and launching pilot MRV and ETS programs.

• Year 2: Scaling participation for MSMEs, cooperatives, and farmers.

• Year 3: Full integration into official city governance and business regulatory processes.

4. Incentives and Compliance

The framework is designed to be incentive-oriented before becoming strictly compliance-driven.

• Incentives: Include tax breaks, “Net Zero Leader” certifications, and priority in city-funded procurement .

• Penalties: Entities that exceed emission thresholds without purchasing offsets may face proportional fines or the suspension/non-renewal of business permits for repeated violations .

5. Legal and Economic Resilience

By institutionalizing these systems, Naga City becomes eligible for international climate finance, such as the Green Climate Fund (GCF) and the People’s Survival Fund. Notably, the ordinance mandates that its implementation must require no financial cost to the City Government of Naga.