SolGen sides with MORE Power, defends expanded franchise law

By Joseph Bernard A. Marzan

The Office of the Solicitor General (OSG) said the courts cannot question Congress’ decision in expanding the franchise of MORE Electric and Power Corp (MORE Power).

The OSG expressed this position in favor of the power distributor through its opposition to the move of a power sector group to intervene in the suit against MORE Power’s expanded congressional franchise.

In a comment/opposition dated June 1, 2023, the OSG opposed the Urgent Motion for Leave to Intervene and to Admit the Petition-in-Intervention dated April 14, 2023 filed by Philippine Rural Electric Cooperatives Association (PHILRECA).

PHILRECA filed the motion in support of the Supreme Court case filed by Iloilo Electric Cooperatives (ILECO) I, II, and III against amendments to Republic Act No. 11212, the law that gave MORE Power the franchise to distribute electricity in Iloilo City.

The amendments passed in 2022 allowed MORE Power to operate in the component city of Passi, and the municipalities of Alimodian, Leganes, Leon, New Lucena, Pavia, San Miguel, Santa Barbara, Zarraga, Anilao, Banate, Barotac Nuevo, Dingle, Duenas, Dumangas, and San Enrique. These towns and city are currently in the service areas of ILECOS I and II.

In its comment, the OSG refuted PHILRECA’s argument that the three ILECOs, which provide electricity to areas outside Iloilo City, have the right to enjoy exclusivity in their franchise areas.

This was a reiteration of the OSG’s position in its original comment to the cooperatives’ petition against RA 11212, citing specific provisions of the 1935, 1973, and 1987 Constitutions on congressional franchises.

“The [1987] Constitution is emphatic that the grant of a franchise for the operation of a public utility shall not be exclusive. […] [A] comparison of the relevant provisions of the 1935, 1973, and 1987 Constitutions readily illustrate the consistent position of the framers, to prohibit exclusivity in the grant of franchises,” the OSG said.

The OSG added that since the law was a valid act of Congress, the case would then involve a “political question,” which means that it cannot be given credence by the Supreme Court.

“[I]t has been consistently shown that a franchise is a special privilege in the sense that the grant thereof is not a demandable right. Particularly, it is a privilege granted by Congress alone, which it may subsequently amend, alter, or repeal,” the OSG said.

“With Congress having exercised its prerogative to expand the coverage of respondent MORE’s franchise within the bounds set forth under the Constitution, the validity of the assailed provision of R.A. No. 11918 is, it is respectfully submitted, beyond judicial reach,” it added.

On PHILRECA’s intervention, the OSG said the group does not have any right “in law or in fact” to intervene in the instant case.

PHILRECA is a national organization composed of 121 electric cooperatives across the country, which include the three ILECOs.

It has a party list in the 19th Congress represented by Representative Presley De Jesus and was one of the main opponents of the House bills which led to the expanded franchise law of MORE Power.

“[T]here is nothing in the petition-in-intervention unequivocally asserting that petitioners ILECO I, II, and III are members of PHILRECA. And secondly, even assuming that petitioners belong under PHILRECA’s organization, the latter’s ‘obligation’ towards petitioners does not automatically translate into legal interest within the contemplation of the law,” they opined.

The OSG is acting as counsel to the Energy Regulatory Commission (ERC), one of the named respondents in the case filed by ILECO I, II, and III against the constitutionality of Republic Act No. 11918.

The law, which lapsed into law on July 30, 2022, amended Republic Act No. 11212 to expand the franchise of MORE Power to several Iloilo towns which are in the service areas of the ILECOs.

Aside from the ERC and MORE Power, also named as respondents in the case were Executive Secretary Lucas Bersamin and the Senate and House of Representatives.