Court junks PECO bid to expropriate assets

MANILA, Philippines — The Court of Appeals has rejected the bid of Panay Electric Co. (PECO) to stop the expropriation of its assets in Iloilo City.

At the same time, the CA ordered Razon-led MORE Electric and Power Corp. to take over the assets of PECO, the long-time power distributor in Iloilo.

The CA justices ruled that there is no damage to PECO’s business since Congress has granted the distribution utility franchise to MORE under Republic Act 11212, signed by President Duterte last Feb. 14.

The CA also found no truth to PECO’s claim that the expropriation of its distribution assets would plunge Iloilo City into blackouts, saying MORE ensured the government such thing would not happen.

It pointed out that under RA 9136, only the Supreme Court could stop the implementation of any portion of the Electric Power Industry Reform Act (EPIRA), which includes the power of eminent domain by DUs in their franchise areas.

The CA also said that even if the Supreme Court upholds the Mandaluyong Regional Trial Court’s decision striking down the expropriation powers of MORE under Sections 10 and 17 of its franchise law, MORE still retains the power of eminent domain under RA 9136 or EPIRA which the Supreme Court already ruled as constitutional in previous rulings.

While PECO’s franchise expired last Jan. 19, it was allowed by the Department of Energy (DOE) and Energy Regulatory Commission (ERC) to continue operating until MORE takes over and expropriates the existing assets to ensure continued power service in the franchise area.

It recently announced its plan to pour in P1.1 billion to innovate and expand its distribution network in the next 10 years.

Investments include the upgrade of meters to smart meters, construction of new substations, and for other various line equipment.