SC upholds 2013 ERC order allowing Meralco’s staggered power rate hike

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Metro Manila (CNN Philippines, July 5) – The Supreme Court (SC) has upheld the 2013 order of the Energy Regulatory Commission (ERC) which has allowed the Manila Electric Company (Meralco) to implement a staggered power rate hike amounting to ₱22.64 billion.

Six justices voted to affirm the 2013 ERC order, while five dissented. Two magistrates inhibited from the voting.

In its decision released on Monday, the high court denied the separate petitions filed by Bayan Muna and the National Association of Electricity Consumers for Reforms, which argued there is a lack of due process in ERC’s approval of the staggered power rates increase and the agency committed grave abuse of discretion.

In 2013, the ERC approved a staggered increase of ₱7.67 per kilowatt hour (kWh) for the December 2013 billing and ordered an additional ₱1.00/kWh increase in the February 2014 billing.

Meralco requested for a staggered power rate hike after the shutdown of the Shell Philippines Exploration B.V. Malampaya operations and scheduled maintenance of other power generation plants. The power utility firm estimated around ₱22.64 billion worth of generation costs would be passed to consumers due to the circumstances.

The rate hike was never implemented after the SC issued several temporary restraining orders, until the high court stopped the increase in April 2014.

In its decision penned by Associate Justice Jhosep Lopez, the SC said the ERC’s approval of the staggered power rate hike was within the agency’s authority and made the act to “protect the interests of the consumers.”

In his dissenting opinion, Associate Justice Marvic Leonen said the ERC should have done a thorough investigation on why Meralco made the request for the power rate increase.

"The sheer speed at which the Energy Regulatory Commission moved in favor of Meralco's plea demonstrates an abject inability to act in keeping with its mandate, the imperative of public interest, and the vast competencies vested in it,” Leonen said.

Meralco did not comment on the SC verdict. In a statement, the company said it has yet to receive the copy of the court decision.

Bayan Muna decried the SC decision as the increase in power rates “could not have come at a worse time.”

“Financial burden like this, once Meralco imposes this new power rate hike – on top of the already high electricity rates – may already break the Filipino consumers’ back,” said former Bayan Muna representative Carlos Zarate in a statement.