Proposed law to suspend payment of utility bills during emergencies—appealed to Senate

By Vanne Elaine Terrazola

State regulators and companies appealed to the Senate to consider the concerns of the public utility industry in crafting a law that would suspend the payment of bills during calamities and emergencies.

The Senate Committee on Trade, Commerce, and Entrepreneurship recently started its discussion on Senate Bill No. 1473, or the proposed "Three Gives Act," inviting officials and stakeholders from power, water, and telecommunication sectors. The bill, filed by Senator Francis Tolentino, seeks the imposition of a moratorium on all residential utility bills in the duration of a state of calamity, and allows the payment of dues that fall within the suspension period in three monthly installments.

The National Electrification Administration (NEA), however, said that electric cooperatives would be most affected by such a moratorium. NEA Legal Services deputy administrator Rossan Rosero-Lee, during the committee hearing on Thursday, May 21, said that while there is a need to relieve consumers' burden during calamities, the suspension of payments would affect the financial position of electric cooperatives, since the "non-stock, non-profit, and revenue-neutral" firms also have dues to pay.

Manila Electric Company (Meralco) vice president and utility economics head Lawrence Fernandez echoed this sentiment. He explained to the panel that the electric industry does not only involve distribution utilities, but also power generation and transmission.

Fernandez said that aside from the charges reflected in their customers' bills, distribution companies also settle their obligations to government agencies and generation companies. "Hence a moratorium in payment by customers of distribution utilities will need to be matched by a moratorium in payment by distribution utilities to the mentioned entities," he suggested.

Officials from the Department of Energy and Energy Regulatory Commission also said there is a need to qualify the types of calamities that would trigger the automatic moratorium, as well as the penalty for violators.

Sen. Sherwin Gatchalian, energy committee chairman, said the lack of a similar protection for the power sector would cause "unintended consequences," in the supply of power as well as in the country's banking system.

The Local Water Utilities Administration (LWUA) also asked for relief for 530 water districts that supply about 4.7 million households. Like the electric distribution companies and cooperatives, water districts also rely on the payments of their consumers to sustain their operations. Of the total number of water districts in the country, 60 percent are small water districts or those that serve less than 3,000 households, said LWUA administrator Jeci Lapus.

Lapus said the LWUA is also "dependent" on the payment of interest from the loans of water districts. "Kung di sila magbabayad, kami ang domino (If they will not pay, we will be at the end of the domino," he said.

The Metropolitan Waterworks and Sewerage System-Regulatory Office, for its part, suggested a "targeted" imposition of the moratorium to prevent hampering the operations of Metro Manila water concessionaires Manila Water and Maynilad.

Telecommunication companies also called for a "well-balanced" piece of legislation that would address the concerns of the involved sectors and their employees. Hearing the positions of the utility providers, Tolentino realized the need to balance the concerns of consumers, corporations and regulators.

At the end of the hearing, he clarified that he is not pushing for a bill that would legislate "compassion" only for the consumers. Another hearing will be held to discuss the bill further.