Power firm PACERM-1 fined over plant testing, commissioning

THE ENERGY Regulatory Commission (ERC) has fined the proponent of a new power generation project in Misamis Oriental for its failure to file a certificate of compliance three months ahead of its targeted date of testing and commissioning.
In a decision, the ERC has imposed a penalty of P100,000 on PACERM-1 Energy Corp. for violating Section 4, Article III of the ERC’s 2014 Revised Rules.
“Upon evaluation and thorough review of the records of the case, particularly the facts as stated in its explanation, the Commission, recognizes the new management’s alleged lack of knowledge. However, respondent PACERM-1 should have exercised due diligence in the previous management’s business affairs,” the ERC said.
“Hence, respondent PACERM-1’s alleged good faith in believing that the previous management has already complied the necessary documents and fulfilled all the requisites under the Revised Rules for the Issuance of COC for Generation Companies is untenable,” the regulator added.
The ERC’s decision was dated June 5, 2018, although it was docketed only last week. It was signed by Chairman and Chief Executive Officer Agnes T. Devanadera and the four commissioners.
The commission issues a certificate of compliance after it has conducted a technical inspection. The certificate is proof that a power plant complies with the applicable regulations, making it safe to switch on and operate.
The fine represents the full amount for first and second violations of the ERC rules. PACERM-1 sought a reduction of the fine by 50%, but the ERC rejected the plea.
PACERM-1 is building a bunker fuel-fired plant with three units, each with a capacity of 3.5 megawatts in Barangay Quibonbon, El Salvador City in Misamis Oriental.
It said the new management officially started on July 1, 2017, with its new president filing the application for a certificate of compliance.
The company received on Jan. 29, 2018 the commission’s order asking it to explain why no administrative penalty should be imposed on it and/or criminal action instituted against its directors and officers for the violation of the ERC rules.
Its officers said they learned that the previous leadership had started its plant commissioning before the application for the certificate through the ERC case. — Victor V. Saulon