PECO gets provisional authority to continue power distribution in Iloilo

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By Emme Rose S. Santiagudo, Correspondent

PANAY ELECTRIC Co., Inc. (PECO) has been granted provisional authority by the Energy Regulatory Commission (ERC) to continue operating in Iloilo City as the company’s certificate of public convenience and necessity (CPCN) expires Saturday (May 25).

The provisional CPCN is contained in a May 21 order issued following an ERC en banc deliberation.

“Under the law, we (the ERC) are authorized to grant PECO the necessary provisional CPCN during the interim period or until MORE (Electric and Power Co.), the legislative franchisee, has established and can fully operate its own distribution system,” ERC Chairperson and Chief Executive Officer Agnes VST Devanadera said in a statement on Friday.

The franchise of PECO, which has been operating in Iloilo City for 95 years, expired last January.

Congress granted MORE Power a new franchise for the city through Republic Act (RA) 11212, but the new company has yet to secure a CPCN.

The two firms are currently locked in court battles.

In issuing the provisional CPCN, ERC cited Section 17 of RA 11212, which grants a provisional authority to PECO to operate the distribution system until MORE Power establishes its own system and completes its transition period not exceeding two years.

Ms. Devanadera clarified that the provisional CPCN granted to PECO during the transition period “shall not be construed as extending the franchise of PECO which already expired on January 18.”

MORE Power Chief Executive Officer and President Roel Z. Castro, sought for comment, said, “That’s proper… The beneficiaries are customers. At the end of the day we’re always looking at the welfare of the consumers.”

Meanwhile, the Iloilo City Regional Trial Court (RTC) Branch 37 has postponed the proceedings for MORE Power’s petition to acquire PECO’s assets, which was scheduled last Thursday (May 23).

Iloilo RTC Judge Marie Yvette D. Go deferred the hearing on the writ of possession filed by MORE Power while she decides on PECO’s motion to suspend the entire proceedings.

MORE Power filed the case to take over PECO’s distribution system and other physical assets after securing its congressional franchise.

PECO, on the other hand, filed a petition before the Mandaluyong RTC Branch 209 questioning the authority granted to MORE Power as contained in RA 11212.

PECO argued that allowing MORE Power to take over its assets is “arbitrary and confiscatory and that the law authorizing such is not for public purpose.”

In an interview on Wednesday, PECO Administrative Manager Marcelo U. Cacho pointed out that before any expropriation could take place, all court cases must first be resolved.

“The Constitutional question (before the Mandaluyong RTC) is a grave and a serious matter, that will be a precedent to future actions and decisions, so that should be answered before expropriation can happen,” Mr. Cacho said.

PECO officials have previously said that they intend to again file for an extension of their franchise under the incoming 18th Congress.