SC stops Meralco power rate hike

Rappler.com
(3rd UPDATE) A 60-day temporary restraining order is imposed by the Supreme Court

STOPPED. The proposed power rate hike is stopped. File photo by AFP

MANILA, Philippines (3rd UPDATE) – The Supreme Court on Monday, December 23, issued a 60-day temporary restraining order (TRO) on the P4.15-per-kilowatt-hour power rate hike of the Manila Electric Co. (Meralco).

Meralco was set to implement the increase this month, following a December 9 approval by the Energy Regulatory Commission. But two groups led by leftist lawmakers asked the High Court last week to stop the rate hike; Meralco and the ERC, as well as the Department of Energy, are respondents in the case.

The High Court said the TRO takes effect immediately.

On December 19, lawmakers from the Makabayan bloc in the House of Representatives sought a TRO against the record-high price hike of Meralco, citing “transcendental public interest.”

On December 20, representatives of the National Association of Electricity Consumers (Nasecore), the Federation fo Village Association (FOVA), and the Federation of Las Piñas Homeowners Association also sought the Court’s intervention, saying  the P4.15-per-killowatt-hour (kWh) December increase went against public interest.

The High Tribunal ordered both petitions consolidated. It scheduled oral arguments on the issue on January 21. 

Meralco earlier said the increase resulted from the shutdown of the Malampaya gas field and outages of power plants where Meralco sources its power requirements from. Meralco said it was forced to source power from plants that uses diesel, which is more expensive than natural gas. 

The petitioners told the Court, however, that ERC’s approval came without the benefit of a notice or hearing involving the public, who are to bear the brunt of the increase. This amounted to “lack or excess of jurisdiction.” 

Several quarters questioned the shutting down of the plants simultaneously as they said a possible collusion happened, sabotaging market competition.

By January 2014, the Department of Justice’s Office for Competition – ordered by Justice Secretary de Lima to conduct a probe into the matter – will file a report outlining recommendations resulting from its investigation. A review of existing energy laws or a passage of a new one may be recommended, said De Lima. 

Victory for consumers

Senators hailed the decision.

“It’s a good Christmas gift of the Supreme Court to the people. Nice way to start the year!,” Deputy Minority Leader Vicente Sotto III said in text message to reporters.

Senator Antonio Trillanes IV said that the TRO is a “victory for the consumers” that should be sustained. “We should sustain the pressure so the freeze would be permanent. In the meantime, we shall find ways to avert future spikes in power rates,” Trillanes said.

Last week, Trillanes proposed a bill that seeks to allow the government to use the Malampaya fund to subsidize power costs in case of a market failure and for the repair and rehabilitation of transmission towers and energy-related equipment during calamities. 

The senator is seeking President Aquino’s certification of the proposed measure as urgent so it can save consumers from temporary payment of higher electricity bills. – with Buena Bernal/Rappler.com