BY AWARDING the franchise to supply electricity to Iloilo City to an entity, MORE Electric and Power Corp. (MORE Power), which is not currently able to accept the responsibilities of the franchise, the legislative branch of government has sidelined itself.
Ownership of the franchise has become, for the time being, irrelevant. The decision as to who can supply electricity to Iloilo is now determined by the ownership of the certificate of public convenience and necessity (CPCN). This was awarded by the Electricity Regulatory Commission (ERC) to PECO and is currently held until May 25.
On March 2, Panay News reported that “MORE power got its own CPCN from the ERC on Dec. 27, 2018.” This needs to be confirmed. A national broadsheet reported that MORE only applied for “provisional approval” from the ERC early last week. MORE said provisional approval should be secured “as there might be difficulty in getting a final decision amid the heavy caseload handled by the ERC.” This timing seems reasonable since the franchise bill Republic Act No. 11212 was only signed by President Rodrigo Duterte on Feb. 14, 2019.
In any case, what would be the purpose of issuing a CPCN to MORE when it cannot yet supply electricity to Iloilo?
Those who receive electricity supplied by Central Negros Electric Cooperative (Ceneco) are uneasy when the term “provisional authority” is used in the context of ERC. Between 2011 and 2015, Ceneco entered into several bilateral agreements with the provisional authority of the ERC. The first of these, in 2011, caused Ceneco to enter into a contract with Cebu-based Kepco-Salcon which committed Ceneco to pay for electricity that its customers did not ask for, want, or need. In 2017, ERC which shares responsibility with Ceneco for this nonsensical decision, awarded Kepco-Salcon P232 million for this non-existent electricity.
Who pays?
Ceneco’s hapless customers of course!
Agnes Devanadera, currently ERC Chairman, has said that she will examine bilateral contracts. I hope she does. Ceneco has other bilateral contracts which would benefit from scrutiny since the costs to Ceneco’s customers are extremely high-much higher than would be the case if Ceneco acquired the electricity from the Wholesale Electric Spot Market (WESM).
PECO’s customers need to be extremely vigilant when it comes to decisions made by ERC.
Caveat Emptor!
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The dialogue between Enrique Razon Jr. and PECO’s Cacho family has been ongoing since 2017. Razon reportedly offered P6 billion for PECO’s infrastructure.
The business section of a national broadsheet of Nov. 14, 2018 reported that the Cachos rejected the P6 billion offer. An insider from Razon’s camp opined: “They should have just taken our offer of P6 billion last year.”
It seems likely that if and when eminent domain negotiations happen, then PECO will quote the P6 billion offer.
After all, eminent domain means that a fair price should be paid./PN
