ERC revokes PECO license; hands power deal to MORE

MANILA, Philippines — The Energy Regulatory Commission is revoking the provisional certificate of public convenience and necessity (CPCN) of Panay Electric Co. (PECO) to operate Iloilo City’s power distribution services in favor of Razon-led More Electric and Power Corp. (MORE).

This despite the Iloilo Regional Trial Court’s (RTC) order for MORE to return the operations of substations and other power distribution utilities they took over last week.

In its Thursday meeting, ERC said it has resolved to revoke the provisional CPCN issued to PECO after determining that “MORE has established or acquired its own distribution system and verified MORE’s complete transition to full operations.”

Despite the non-renewal of its franchise, PECO was allowed by the Department of Energy (DOE) and ERC to continue operating through its CPCN until the new power player completes its transition to full operations.

An ocular inspection confirmed MORE Power’s takeover of Iloilo City’s power distribution services, ERC said.

Based on the inspection, the Razon-led firm gained full possession and control over five substations and prepared for all other aspects related to electricity distribution.  It also has power supply contracts in place with four power suppliers.

ERC’s inspection team also verified the full readiness and capability aspects of development, operation and maintenance of distribution systems.

The power regulator also decided to issue a provisional authority to MORE to operate Iloilo City’s power distribution network and  allow it to implement the last approved distribution charges of PECO.

In turn, ERC will require MORE to source and procure its power requirements in accordance with Section 5 of Republic Act (RA) 11212, which granted the distribution franchise to the Razon firm.

“While MORE is unable to secure the certificate of exemption from the Department of Energy (DOE) necessary to enter into emergency power supply agreements, it shall source its power requirements from the current power generation suppliers of PECO,” the power regulator said.

However, PECO said the ERC order is not yet final since they have not received any such directive yet.

“We are hopeful that once we are able to apprise the ERC of the true situation that’s happening on ground,  they will not only reverse this order but  also deny outright the application of MORE for a CPCN,” she said.

The court order penned by Iloilo RTC presiding Judge Emerald Requinto-Contreras was premised on MORE’s pending release of its own CPCN from the ERC.

Contreras said MORE should follow the addendum that states PECO personnel should be the ones to operate the power distribution facilities and MORE employees should only observe as part of their immersion into the service.

The presiding judge also said she is still not sure about the capability of MORE to operate the facilities and by returning the operations to PECO, the court is protecting the consumers from the possibility of power outages.

“The decision of the Iloilo RTC to direct MORE to give back power distribution operations to PECO is a crucial development because it proves that everything that we have been saying in the past few weeks is true,” Elamparo said.

Last week, MORE took over some substations of PECO on the strength of a writ of possession issued by the same RTC.