4 suspended ERC commissioners ask CA to lift 3-month suspension


By Rey Panaligan

Four suspended commissioners of the Energy Regulatory Commission (ERC) have asked the Court of Appeals (CA) to lift their three-month suspension imposed by the Office of the Ombudsman so as not to paralyze the operation of the agency, a quasi-judicial body that regulates the country’s electric power industry.

Court of Tax Appeals Photo credits: cta.judiciary.gov.ph | Manila Bulletin Court of Tax Appeals
(Credit: cta.judiciary.gov.ph | Manila Bulletin)

The petition was filed by Commissioners Alfredo S. Non, Gloria Victoria C. Yap-Taruc, Josefina Patricia M. Asirit and Geronimo D. Sta. Ana. They asked the CA to issue a temporary restraining order (TRO) that would lift their suspension.

Last month, the four commissioners were held administratively liable for tolerating Manila Electric Company’s (Meralco) alleged misuse of bill deposits by allowing its commingling with the capital or operation cost of the power firm.

The three-month suspension was their second from the Office of the Ombudsman. They had earlier been suspended for one year when they were found guilty of conduct prejudicial to the best interest of the service, aggravated by simple misconduct and simple neglect of duty.

But the CA, on their petition, shelved the one-year suspension paving the way for their return to their posts.

The new suspension order arose from the syndicated estafa complaint filed by the National Association of Electricity Consumers for Reforms Inc. (Nasecore) for unauthorized use by Meralco of the bill deposits of customers and the unjust fixing of its interest rates, and the noncrediting of thereof in favor of the consumers.

The Office of the Ombudsman did not find them liable for estafa. But it ruled that the four ERC commissioners failed to implement strictly the rules defining the nature of bill deposits as “mere guarantee in payment of bills” which must be returned upon termination of the distribution utilities (DUs) service.

It pointed out that the four ERC commissioners failed to perform their mandate to issue rules or policies such as the creation of a separate escrow account to avoid commingling of bill deposits with the capital or operational expenses of Meralco or any DU for that matter.

“Meralco treated the bill deposits as part of its capital without the benefit of a reasonable return of interest to accrue to consumers – a practice which respondents appeared to have acquiesced in,” it said.

“In fact, without the letter of Nasecore, as represented by complainant herein, respondents will continue to ignore their mandate in promoting, safeguarding and protecting the interest of the public consumers by regulating, monitoring or checking Meralco’s utilization of the bill deposits, at the very least,” it added.

Based on Nasecore’s complaint, the total consumers’ deposits now amount to P61.36 billion since 2006, but Meralco declared a balance of only P26.5 billion in its financial statement.

Thus, Nasecore claimed that consumers have been “robbed” a total of P34.84 billion or more considering that the amount will still increase after due accounting by the ERC and Commission on Audit (COA) to determine the actual amount accrued compounded interest earned by the bill deposits.

At the same time, the Office of the Ombudsman junked the allegation that the utilization of the bill deposits for DUs or Meralco’s operation is an acceptable practice, as it pointed out that it does not mean that such practice is legal or advantageous to the public.

It stressed that despite their knowledge of the low-interest rates assigned to the bill of deposits, the four ERC commissioners failed to correct the disparity and adopt measures to advance the interest of the consumers by providing a reasonable return on the latter’s deposits.

In their CA petition, the four commissioners said:

“… given the fact that the Ombudsman was informed of all the actions of the Commission pertaining to the Bill Deposits including the Rules to Govern the Monitoring and Reporting Process through the pleadings submitted before it, it would have been prudent on the part of the Ombudsman to have studied the impact thereof in the overall policy on bill deposit after the same was issued with finality before it can make a decision on neglect of duty.

“If not, the Ombudsman should have explained why it did not need the outcome of the rule making process in making its conclusion that regardless of the rule making process, neglect of duty was committed. Unfortunately, the Ombudsman miserably failed on both counts.

“In ruling that the Commissioners committed neglect of duty, not only it made a very hasty decision, Ombudsman is imposing its own ‘wisdom’ on regulation of a highly specialized industry. This interference is not only unjust, but it disrespects the line of separation of powers in our government structure.”

They cited the ruling of the CA early this year on the shelving of their one-year suspension:

“… it would be myopic for this Court to view and consider the threatened injury only from the perspective – or on the part – of the petitioners. Given the circumstances of the instant case, this Court must look at the bigger picture and consider the interest of the public, the irreparable injury that it may suffer if a TRO is not issued.

“This is because, as pointed out earlier, petitioners are public officials performing important duties and functions pertaining to the power sector. We hasten to add that what We give importance to and is of utmost concern is not the petitioners themselves but their office, and the public service that would be and currently is being jeopardized by reason of their present predicament.

“In the first place, petitioners, all four (4) of them, are the commissioners of the Energy Regulatory Commission. Under Section 38 of the EPIRA, the Commission is composed of a Chairperson and four (4) members. The said Section also states that “he presence of at least three (3) members of the Commission shall constitute a quorum and the majority vote of two (2) members in a meeting where a quorum is present shall be necessary for the adoption of any rule, ruling, order, resolution, decision, or other act of the Commission…’ and that “in fixing rates and tariffs, an affirmative vote of three (3) members shall be required.” Here, four (4) of the members of the Commission are suspended and thus, unable to perform their duties. In other words, the governing body of the Commission is practically on a shutdown.

“Evidently, therefore, there is a clear and present disruption, nay cessation, of important and exigent public service necessitating relief from this Court.”