SC ruling on Iloilo power utility row to set precedent for businesses

Published August 25, 2020, 5:00 AM

by Myrna M. Velasco

A final ruling of the Supreme Court on the two-year dispute surrounding the distribution of electricity in Iloilo City could set precedent for businesses.

As the highest court of the land is anticipated to render its verdict on the case soon, it was stipulated by Panay Electric Company (PECO) that a ruling in favor of its nemesis MORE Electric Power Corporation could “legitimize hostile takeover of businesses” even those that are owned by private corporations.

In a virtual press briefing over the weekend, PECO counsel Atty Estrella Elamparo noted that the main contention of PECO is the power of “eminent domain” granted to MORE via its power distribution franchise under Republic Act 11212, which warranted it an authority to expropriate the private assets of PECO.

Elamparo argued “if the MORE position is affirmed by the Courts, it will be followed by others who are not qualified and are not deserving to be granted a franchise by Congress.”

She cited that when MORE was granted with a franchise to operate power distribution in Iloilo City, it technically had “zero experience and capabilities,” and its legal stature then was a mining company – it was not an energy company with interest in power distribution.

The PECO lawyer said the strategy employed by MORE was to “look for a franchise that is about to expire, and then lobby to be given the right to take over the franchisee’s assets as well as its franchise rights.”

Given such maneuver, Elamparo averred that “if the MORE position is affirmed by the Courts, it will be followed by others who are not qualified and are not deserving to be granted a franchise by Congress.”

PECO further contended “a judicial ruling in favor of MORE can effectively legitimize hostile takeovers of other enterprises and franchises by interested parties who will not need to prove competence, expertise or industry history.”

The firm added “the resolution of the MORE-PECO case has national implications – and go beyond what seems to appear as a mere power tussle between two regional rival companies.”

And while the legal scuffle between the two firms is still finding its way out of the judicial maze, consumers in Iloilo City sounded off added grievances over higher system loss charges and disrupted billings – that was on top of the recurrent power outages that they complained of in the past months.

Allen Aquino, coordinator of Koalisyon Bantay Kuryente, cited that “based on comparison of consumer bills, MORE’s system losses being billed to consumers are close to 12%, which is almost double the government-mandated rate of 6.25-percent.”

He stressed “MORE’s failure to achieve system loss reduction is costing our consumers potential countless savings, while confusing and causing them unnecessary stress with their inexplicable overbillings.”

The consumer advocacy group similarly indicated that it will be the final ruling of the Supreme Court that could ultimately settle and sort out all the pressing concerns of consumers in Iloilo City.  

 
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