SC asked to void ERC order on P100-B collection from consumers

MANILA, Philippines - A consumer group has asked the Supreme Court (SC) to void Energy Regulatory Commission (ERC) resolutions allowing electric cooperatives to collect payment for loans and return to consumers some P100 billion collected over the past 40 years.

The National Alliance for Consumer Empowerment of Electric Cooperatives (NACEELCO) questioned the constitutionality of the ERC’s rules of setting the electric cooperatives’ wheeling rates (RSEC-WR) and Resolution No. 14 modifying the terms of members’ contribution for capital expenditures (MCC) to reinvestment fund for sustainable capital expenditures (RFSC) and MCC-real property tax (RPT) to provision for RPT as provided in the RSEC-WR.

Roberto Rosales, representing NACEELCO, alleged that the ERC orders had violated the consumers’ right to due process and Presidential Decree 269 since they resulted in unlawful taking of one’s property without due process and compensation.

Under PD 269, member-consumers will not “in any manner answer for any liability or debts incurred by the cooperative and the property of the members shall not be used in the execution thereof,” NACEELCO added.

NACEELCO’s petition also named as respondent 60 electric cooperatives.

NACEELCO said the ERC’s imposition of MCC or RFSC as a form of investment solicitation to fund the expansion and other capital expenditures of electric cooperatives is highly irregular, oppressive and unconstitutional for violating the due process and equal protection clauses on property.

“The mandatory collection of the MCC or RFSC by the ECs from its member-consumers without the proper explicit accounting entries and acknowledgment of being a patronage capital and without the benefit of a fair return of their investments or patronage capital input or contributions is tantamount to taking a property without just compensation and is violative [of] Section 9, Article III of the Constitution,” read the petition.

NACEELCO said the electric cooperatives’ mandatory collection of MCC or RFSC violated the Constitution.

“The unjust collection of the MCC or RFSC by the ECs as authorized and ruled by ERC is contrary to law as nowhere in the provisions of PD 269 does it say that members on a voluntary and cooperative member will provide capital to fund the capital expenditures by cooperatives. It likewise violates Section 37 of PD 269,” read the petition.