by Victor V. Saulon, Sub-editor

Regulators have again given generation companies and distribution utilities temporary relief from a rule that requires them to sell to the public at least 15% of their common shares.

The deadline for compliance lapsed last June 29, but in a resolution dated June 27, the Energy Regulatory Commission (ERC) has extended the deadline for one year to June 29, 2018, or until it rules on a long drawn-out plea by the companies that the ERC consider registration with corporate regulator Securities and Exchange Commission (SEC) as “among the modes of public offering”, whichever is earlier.

The ERC did not identify the number of generation companies nor distribution utilities that are covered by the resolution.

But based on data from the Department of Energy, the country has around 137 power plant operators, although a number of them run several generators. Some of them are subsidiaries of companies that are listed.

Manila Electric Co., the country’s biggest electricity distribution utility, is listed. Visayan Electric Co., Inc., the second largest, is not listed but the joint venture partners that own the utility are — Aboitiz Power Corp. and Vivant Corp.

AboitizPower also owns Davao Light and Power Co., the country’s third-biggest utility. The unit is also not listed.

That was not the first time that the ERC extended the deadline for companies to allow the public to partly own them.

The minimum 15% public ownership was stipulated in the implementing rules released on August 17, 2005 giving teeth to Republic Act No. 9136 or the Electric Power Industry Reform Act of 2001, or EPIRA in a sweeping reform meant to attract private capital into the sector after a power crisis in the early 90s.

That did not push through, with the ERC itself suspending implementation until it completes public hearings on the implementing rules.

Six years later, or on May 23, 2011 through a resolution, the regulator revived its bid to require the companies to sell shares to the public in five years’ time.

That five-year period, which ended on June 29 last year, was extended for one more year or June 29 of this year, after the ERC received a letter asking whether its 2011 resolution will be put on hold ahead of the resolution of a separate petition filed on October 13, 2015.

The petition in 2015 sought the inclusion of the registration of common shares at the SEC among the allowed modes of public offering. It also asked that ERC’s resolution issued in 2011 be held in abeyance ahead of petition’s resolution.

The inclusion of SEC registration was first raised in 2011, when the Private Electric Power Operators Association sought clarification from the ERC in its letter filed on July 4, 2011.

In its resolution released this week, the ERC said that while it was in the process of completing the required public consultation, a “fortuitous event” took place as martial law was declared in Mindanao “thereby interrupting the conduct of hearings prescribed under the ERC Rules of Practice.”

“WHEREAS, the Commission in order to complete the required public consultations on the instant petition and due to the fortuitous event mentioned, has resolved, to extend for one (1) year the compliance period provided in said Resolution pending final resolution on the Petition,” the ERC said.

It was signed by the four ERC commissioners Alfredo J. Non, Gloria Victoria C. Yap-Taruc, Josefina Patricia A. Magpale-Asirit and Geronimo D. Sta. Ana.

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