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Sta. Rosa City lone district Rep. Dan Fernandez is prodding the Energy Regulatory Commission (ERC) to withhold action on power supply agreements (PSA) between the Manila Electric Co. (Meralco) and two generating firms pending final resolution of a case opposing the companies’ bid to raise power rates. 

He said that while the case is pending before the Supreme Court (SC), the ERC should hold in abeyance taking action on PSAs that Meralco earlier awarded to the two SMC subsidiaries -- South Premiere Power Corp. (SPPC) and San Miguel Energy Corp. (SMEC).

“While the appeal of the Office of the Solicitor General (OSG) remains pending with the Supreme Court, I strongly urge the ERC to suspend and withhold approval of new PSAs between Meralco and the two SMC’s generating companies until the High Court reaches a final decision on the case against their bids to increase electricity rates,” Fernandez said.

“It is better for the ERC to wait for the SC to render judgment on the controversial case involving the PSAs between Meralco and SMC in order not to preempt or render moot and academic its ruling on the matter,” the senior lawmaker added.

Fernandez made the statement after asking the OSG, which represents the ERC, to elevate to the SC the Court of Appeals (CA) decision that reversed an ERC ruling, which had earlier junked the petition for rate increase filed by Meralco and the two generating companies.

He says the case has to do with the collection of higher power rates that would further burden Filipino consumers, who are already paying one of the world’s highest electricity rates. 

SPPC runs the Ilijan gas-fired power plant, while the SMEC runs the coal-fired power plant in Sual. Both companies, along with Meralco, have asked the ERC to approve a 30-centavo rate increase for a new PSA.

In his letter received by the OSG last May 3, Fernandez said the two power plants “are seeking to supply emergency power to Meralco” but at higher rates.

The PSA that the two plants entered with Meralco have been terminated following the ERC ruling last year that disallowed Meralco’s and the SMC plants’ petition for a rate increase.

Fernandez said he is of the opinion that the ERC cannot just approve another PSA between SMC and Meralco without filing an appeal of the CA’s Dec. 28, 2023 ruling with the SC for final judgment. 

In a ruling on June 27, 2023, the CA nullified an ERC decision denying the rate increase petitions filed by Meralco and SMC. The CA’s 13th Division said the ERC acted “with grave abuse of discretion amounting to lack or excess of jurisdiction.”

The companies brought the case to the CA after their petition for a rate increase was junked by the ERC.

On Dec. 28, 2023 the CA’s 13th Division affirmed with finality its decision overturning the ERC denial of the rate increase petitions by Meralco and the SMC subsidiaries.