Pestering MORE Power no good for PECO

By Herbert Vego

 

THERE is no doubt that Panay Electric Company (PECO) is desperately trying hard to grab back from More Power and Electric Corp. (MORE Power) the power-distribution franchise in Iloilo City, citing the opinion of Dean Antonio La Viña of the Ateneo School of Governance interpreting the takeover as “confiscation of private property.”

PECO’s intransigence does not make sense at this time when the Supreme Court (SC) might have already decided on MORE Power’s petition to rule on the constitutionality of the franchise law (RA 11212).

Sometime in August this year, SC spokesman Atty. Brian Keith F. Hosaka announced that, within that month, the 15 SC justices would rule en banc (full court) on MORE Power’s petition.

To reiterate what I said in a previous column, the odds are stacked against PECO because the SC itself had issued a temporary restraining order against the decision of the Mandaluyong regional trial court (RTC) declaring the law (RA 11212) “unconstitutional.”

Otherwise, why would it restrain the said RTC?

This corner does not understand why PECO has to reinforce its lawyers’ opinion with the same “banana” cited by a dean of a school of Law.  His opinion does not matter; it merely duplicates the argument of the Mandaluyong RTC holding MORE Power liable for a crime against private property, hence a violation of due process.

No doubt in its effort to win public opinion, PECO cries “unfair”; the new company should have invested in its own real estate and equipment needed to convey electricity to consumers. As we shall explain later, MORE Power is simply applying the legality of expropriation as a means to an end that is beneficial to the majority of the concerned people.

Why should PECO be repetitive in questioning an act of Congress just because they don’t agree with the law’s Sections 10 and 17?

The undisputed fact is that the transition from the old franchisee to the new one necessitates takeover by MORE Power of physical assets that are indispensable in the continuity of service.

In a sense, it would not deprive PECO of what to them is “private property.” All the power-distribution facilities have already been more than paid for by the power users in almost a century of its operation.

As provided for in Republic Act No. 9136 or the “Electric Power Industry Reform Act” (EPIRA), “the costs for the acquisition, construction and the establishment of the power distribution system were allowed to be recovered through the retail rate approved by the Energy Regulatory Commission (ERC), which retail rate covers full recovery of the costs/funds used to acquire, construct and establish these power distribution system assets.”

Rather than sound bitter, PECO should rejoice that RA 11212 requires MORE to pay “just compensation” for its expropriation. MORE has offered to pay P481,842,450 for that purpose.

Section 10 of RA 11212 stressed the power of the government to expropriate a utility or to delegate it to a private group: “The grantee may acquire such private property  as is actually necessary for the realization of the purposes for which this franchise is granted, including but not limited to poles, wires, cables, transformers.”

Section 17, on the other hand, provides for a smooth transition: “Panay Electric Co. (PECO) shall in the interim be authorized to operate the existing distribution system within the franchise area… until the establishment or acquisition by the grantee of its own distribution system and its complete transition towards full operations as determined by the Energy Regulatory Commission [ERC].”

Assuming for the sake of argument that PECO is allowed to keep the utility’s assets and let MORE Power build from scratch, what for?  Deprived of its expired franchise, it would have no more use for them. Selling the equipment to the junk buyer would earn a pittance

Incidentally, MORE Power’s President Roel Z. Castro – guesting on our radio program “Tribuna sang Banwa” – said that while he is interested in whatever decision the Supreme Court might have already made on the aforesaid case, they have to go ahead with their rehabilitation work because they possess the requisite legislative franchise and a certificate of public conveyance and necessity (CPCN) from the ERC.

Abangan ang susunod na kabanata.