‘WE’RE IN CONTROL’: Razon-led MORE Power starts takeover of PECO assets

By Emme Rose Santiagudo and Jennifer P. Rendon

The end of an era?

After almost a century of controlling Iloilo City’s power distribution business, Panay Electric Corp’s (PECO) lights got blacked out by tycoon Enrique Razon’s MORE Electric and Power Corp. (MORE Power).

The animated and heated tug-of-war between the two power firms wanting to distribute power in the city took a major leap Friday after MORE Power started taking over PECO assets on orders of the Iloilo Regional Trial Court (RTC) Branch 23.

RTC Branch 23 Presiding Judge Emerald Requina-Contreras ordered the court sheriff to place MORE Power in control of certain PECO assets in a 14-page order that reiterated the granting of a writ of possession (WOP) to MORE Power.

The WOP is an offshoot of the expropriation case filed by MORE Power against PECO on March 11, 2019 in exercising its rights under Republic Act No. 11212, which granted the Razon-led firm the congressional franchise to distribute power in Iloilo City.

Pres. Rodrigo Duterte signed RA 11212 into law on Feb 14, 2019.

The order of Judge Contreras, the fifth judge to handle the case, also directed the sheriff to place in MORE Power’s possession certain PECO assets that are essential to a smooth and stable power distribution service.

This is the first time in recent memory that assets of a private power company in Iloilo City were taken over by another private company.

 

Based on the court order, MORE Power took over the following assets:

• the Baldoza, La Paz substation (land including all machinery and improvements, buildings);
• the General Luna, City Proper  substation (machinery);
• the Tabuc Suba, Jaro substation (land and machinery);
• the Bolilao, Mandurriao substation (land, buildings, and machinery); and
• the Avanceña Street, Molo substation (land, and buildings, machinery)

A copy of the writ was posted on PECO’s main office in General Luna Street after Marcelo Cacho, PECO’s head of Public Engagement and Government Affairs, refused to receive the court order saying he’s not qualified to do so.

Cacho also questioned the sheriff if MORE Power will take over the entire area.

“Is this area expropriated? So, this is a private property,” he said while calling security guards to ask the sheriffs and other non-PECO personnel to leave the premises.

In her order, Judge Contreras said it was the “ministerial duty of the court” to issue the writ of possession as the two previous judges gave due process to the parties involved in the case.

She also cited that “the primary goal of the court is a smooth and peaceful transition of operation, to protect the public interest of the people of Iloilo City and its businesses, and to ensure the uninterrupted supply of electricity.”

The coverage and execution of the WOP were based on properties that the court categorized into three.

Category A includes all properties that PECO did not contest as ‘distribution assets’ such as Baldoza, Lapaz Substation, Gen. Luna, City Proper Substation, and Tabuc Suba, Jaro Substation, and among others. These properties have a total assessed value of P217,940,870

Meanwhile, Category B is comprised of the properties which the court initially finds as part of the distribution assets being listed under the ‘distribution plant’ in the Energy Regulatory Commission (ERC) record, and may be necessary for the operation of MORE Power so that the operation may not be interrupted once the writ is implemented.

The properties include meter lab, power plant building and switchboard house in Gen. Luna St. in City Proper. These properties have an assessed value of P14,792,680.

Category C properties are those excluded in the coverage of the writ because they are either under the classification “general plant” or not listed under the distribution plant” in the ERC record such as pole stockyards in Diversion Road, Mandurriao and land set aside for future substation in Brgy. Gen. Hughes in City Proper.  These assets have an assessed value of P2,252,330.

However, Contreras reiterated that properties under categories B and C are the properties that the court reserved to include in the final determination of the properties to be actually expropriated in the expropriation proceedings.

Under this ruling, it is possible that some assets in Category B might be excluded while several properties in Category C might be turned over to MORE Power in the conclusion of the expropriation case.

 

 

EXECUTION

Tension loomed in the main building of PECO in General Luna Street in City Proper and the substations as the sheriff, members of the court, employees of MORE Power and police officials entered the properties to serve the writ.

To guide the execution of WOP, Judge Contreras issued an addendum enumerating the guidelines of its implementation.

The court told the sheriff to serve the writ in a peaceful manner.

 

“To install MORE who may deploy their personnel to man and oversee the substations to exercise their possession and control of the distribution facilities, but the operation should still be handled by PECO personnel who has the technical expertise,” the addendum said.

Judge Contreras said, “this to maintain the status quo of the operation, so as to give time for MORE Power to orient/train/immerse their personnel before they fully take control of the operation”.

 

Moreover, the execution of WOP should see to it that no PECO personnel in the rank and file, would be displaced during the transition period.

PECO refused to receive both the WOP order including the addendum and closed the doors of its main building while the sheriffs roamed around the meter lab and power plant building of PECO to identify properties listed in the writ.

As of 11:15, MORE Power claimed that it has effectively taken over the General Luna St. Substation.

 

“MORE Power had effectively gained possession and control over the machinery, land, and buildings used as the meter lab, power plant building, and switchboard house, nakalista po siya sa WOP and those are exactly the properties that we already possess,” according to Allana Mae Babayen-on, legal officer of the Office of the President of MORE Power, in a press briefing Friday afternoon.

 

The General Luna St. Substation is just one of the five substations of PECO in Iloilo City in the districts of Molo, Jaro, Lapaz, and Mandurriao.

President and Chief Operating Officer of MORE Power Roel Z. Castro said they are working to take over the other substations and will operate once control has been achieved of the five substations.

 

“We already took effective control of it. We are working with the other substations. Everything we are doing in accordance with the court order. We are very grateful that the court upheld our position on the matter of the writ of possession. This is clearly the people’s victory of our great City of Iloilo,” he said.

 

Castro said they will start their operations after the takeover even without the certificate of public convenience and necessity (CPCN) as their application remains pending in the Energy Regulatory Commission (ERC).

 

“It is unusual in the sense that this is the first time that this happened. So far, we have complied with the requirements of CPCN and we are positive that ERC will issue it by next week. A few days of no CPCN is not a problem. If this is something that is being questioned, why don’t we question the franchise of PECO? Between the two, the franchise is stronger,” he said.

 

PECO’s renewal application for its franchise, which expired last Jan. 19, was denied by Congress.

It is currently operating under a provisional authority issued by the Energy Regulatory Commission on May 24, 2019, following the expiration of its certificate of public convenience and necessity.

 

BETTER SERVICE

Amid fears of power disruption, Atty. Babayen-on assured of a smooth transition.

“The legal battle is between us and we ensure that we don’t disrupt services to the end-users,” she said.

Babayen-on said while the legal battle is not yet over, the “biggest hill has been surpassed.”

She said that they have now to deal with just compensation to PECO, as they gained control, but not necessarily in possession, of the facilities.

Babayen-on said Ilonggos could feel the result of their take over in the long-range.

“It would be the greatest insult for the Ilonggos, after that has all been said and done, if we couldn’t give a better service,” she said.

Babayen-on said they’re also happy with how the service of the WOP turned out.

Aside from soliciting the help of the PNP, she said they have third party security to ensure the smooth transition.

She claimed, though, that the scores of policemen who turned up during the service is not a show of force.

“We just want to keep everybody safe,” she said.

Meanwhile, she also called on PECO employees that they could join the pool of MORE personnel, as it is part of the provisions of their congressional franchise.

MORE Power said the contention of PECO that their personnel cut the internet connection and disallowed switchboard personnel from working “is a bald-faced lie.”

“In order to do that, MORE Power would have had to disconnect the internet of the switchboard from the Main Server which is located INSIDE THE PECO MAIN BUILDING. It is impossible because no one from MORE Power ever entered nor attempted to enter the PECO Main Building,” the Razon-led firm said.

To ensure continuity of services to the consumers of Iloilo City, MORE Power trouble shooters and line team are mobilized to provide assistance as may be needed. You may call our hotline numbers at (033) 323-6619 and (033) 327-2985 and mobile numbers 09176375214 and 09190720626.