SC junks ERC appeal vs SMC-Meralco power deal

“Considering that there is no substantial argument to warrant a modification of this court’s resolution, the court further resolved to deny reconsideration with finality.”

MANILA, Philippines — The Supreme Court (SC) has junked with finality the power regulator’s appeal against the termination of the supply contract of energy giants led by business titans Manuel V. Pangilinan and Ramon Ang.

In a regulatory filing, San Miguel Corp. said its legal team has received a copy of the SC 1st division’s resolution yesterday, which upheld the high tribunal’s Aug. 3 decision allowing the revocation of a 10-year power supply deal.

Earlier, the Energy Regulatory Commission (ERC) asked the SC to nullify a Court of Appeals injunction order on the power supply agreement (PSA) between Manila Electric Co. (Meralco) and SMC units South Premiere Power Corp. (SPPC) and San Miguel Energy Corp., now Sual Power Inc.

“Considering that there is no substantial argument to warrant a modification of this court’s resolution, the court further resolved to deny reconsideration with finality,” the SC stated in the decision.

The SC likewise denied the issuance of a temporary restraining order (TRO) sought by the Office of Solicitor General (OSG), which serves as the ERC’s statutory counsel, for “lack of merit.”

Asked for comment, ERC chairperson and CEO Monalisa Dimalanta said they are now consulting with the OSG as “we have not received our copy yet of the SC resolution.”

The issue stemmed from a May 2022 joint motion for rate adjustments filed by SMC units and Meralco seeking a temporary increase in the contract price under the PSAs to recover incremental fuel costs, citing a “change in circumstances.”

Four months later, the power regulator junked the foregoing joint motions, which prompted SPPC to ask the CA to issue a TRO against or annul, reverse and set aside the ERC order.

In January 2023, the CA 13th division granted SPPC’s application for an issuance of a writ of preliminary injunction.

The OSG, however, earlier argued that the CA exceeded its authority when it instructed SPPC and Meralco to engage in renegotiations for their PSA.