PECO not standing down despite Razon’s takeover of facilities for IloIlo electric

Lian Buan

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PECO not standing down despite Razon’s takeover of facilities for IloIlo electric
Panay Electric is now without a franchise or permit, but it is keeping its standoff with the Enrique Razon-owned MORE for Iloilo's electricity – anchoring all its hopes on the Supreme Court

MANILA, Philippines – Panay Electric Company (PECO) refuses to stand down despite losing much of its leverage in the heated saga with the Enrique Razon-owned MORE Electric Power and Corporation for Iloilo’s electricity.

On Thursday, March 5, the Energy Regulatory Commission (ERC) said in a decision that it would revoke the provisional Certificate of Public Convenience and Necessity (CPCN) – or the permit – earlier given to PECO because MORE has essentially completed a takeover of its assets.

A takeover was provided for in the franchise law given to Razon’s MORE by President Rodrigo Duterte in February 2019. 

The constitutionality of the takeover provision is still being resolved by the Supreme Court – a venue that offers hope for PECO.

“MORE has no legal basis to push through with the takeover since the case is still pending in the Supreme Court,” PECO’s legal counsel Estrella Elamparo said in a statement on Friday, March 6.

PECO also said that the revocation of its provisional permit “is not yet final.”

“MORE has no CPCN and thus has no right to provide power distribution services in Iloilo despite holding a legislative franchise,” said Elamparo.

A timeline

PECO has been Iloilo’s electric provider for 95 years until Razon’s MORE came into the picture and got the much-coveted legislative franchise.

Section 10 of RA 11212, or MORE’s franchise law, gave it the right to acquire PECO’s assets “including, but not limited to poles, wires, cables, transformers, switching equipment and stations, buildings, infrastructure, machineries and equipment previously, currently or actually used.”

Section 17 of the law allowed PECO to operate while MORE transitions, but that MORE should have full operations within 2 years. Because of this, in March 2019, PECO was granted a provisional CPCN by ERC.

On July 1, 2019,  the Mandaluyong RTC Branch 209 declared as unconstitutional Sections 10 and 17 of RA 11212.

However, on August 14, 2019, Iloilo RTC Branch 37 issued a writ of possession to MORE, essentially greenlighting the acquisition. This is the expropriation case.

These clashing lower court rulings have been brought to the Supreme Court, with PECO and MORE suing each other. This case is still pending.

On March 2, 2020, the writ of possession was served on PECO and the sherriff’s return showed that MORE “was installed in the possession and deployed personnel….to exercise their possession and control of the distribution facilities.”

Having determined that “MORE has established or acquired its distribution system and verified MORE’s complete transition to full operations,” ERC revoked PECO’s provisional CPCN.

ERC also decided to “issue a provisional authority, pursuant to Section 8 of EO 172, authorizing MORE to operate the distribution network.”

But the defiant PECO insists that this ERC decision can still be overturned. PECO is also at a disadvantage because the Supreme Court refused its request to take the expropriation case out of Iloilo RTC, where PECO says the judge is biased.

“We are hopeful that once we are able to apprise the ERC of the true situation that’s happening on ground,  they will not only reverse this order but should also deny the outright the application of MORE for a CPCN,” Elamparo said. –

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Lian Buan

Lian Buan covers justice and corruption for Rappler. She is interested in decisions, pleadings, audits, contracts, and other documents that establish a trail. If you have leads, email or tweet @lianbuan.