Marcos to CA: Reconsider suspending Meralco-San Miguel power deal


Posted at Nov 27 2022 10:43 AM | Updated as of Nov 27 2022 04:22 PM

Line-men work on powerlines in Batangas on January 27, 2020. Jonathan Cellona, ABS-CBN News/File
Line-men work on powerlines in Batangas on January 27, 2020. Jonathan Cellona, ABS-CBN News/File

MANILA (UPDATE) — President Ferdinand Marcos Jr. "hopes" the Court of Appeals will reconsider its decision to suspend the implementation of a power supply agreement (PSA) between San Miguel-owned South Premier Power Corp. (SPPC) and Manila Electric Co. (Meralco), Malacanang said Sunday.

According to a statement from the Office of the Press Secretary (OPS), Marcos described the temporary restraining order (TRO) issued by the Court of Appeals as "unfortunate," expressing concern that it may open possibilities of increases in power prices.

“We hope that the CA will reconsider. And include in their deliberations the extremely deleterious effect this will have on power prices for ordinary Filipinos,” Marcos was quoted by the OPS to have said over the weekend.

The ERC said it received the CA decision on Nov. 24, granting a petition for certiorari filed by SPPC. The suspension of the PSA implementation is effective for a 60-day period.

The SPPC had filed a petition for a power price increase, which the ERC said it denied "since the regulatory body ruled that the agreed price in the PSA is fixed in nature, and the grounds for increase cited by SPPC and Meralco were not among the exceptions that would allow for price adjustment."

ERC chairperson and CEO Monalisa Dimalanta lamented the immediate effect of the temporary suspension of the PSA due to the TRO.

"This will consequently expose approximately 7.5 million registered Meralco consumers in the National Capital Region and other areas in Region III and IV to higher electricity prices without preparation usually observed in case of PSA termination," the ERC said in a statement.

"If these PSAs are immediately suspended, this brings us precisely to the situation which we at the ERC have sought to avoid with our ruling that required the proper observance of the terms of the PSA, including the contractually-agreed process of termination," Dimanlanta said.

The ERC said the fixed price PSA between Meralco and SPPC covers 670 megawatts of supply, which has protected Meralco consumers from the "volatility of prices" over the past several months.


Terry Ridon, convenor of public policy thinktank Infrawatch PH, said Marcos "should allow full judicial proceedings to take its course."

"His views may ably be represented through ERC lawyers and the Solicitor General," Ridon said in reaction to comments made by the president on the issue.

"The TRO will allow continuing discussions on the fair and reasonable rates which can be imposed on the Meralco franchise area given elevated fuel and coal prices in the last few months," he added.

The discussions, Ridon said, will provide "a way forward towards a determination on whether the price proposal in the joint petition constitutes as the least cost to consumers in comparison to other prospective proposals extraneous to the current power supply agreement, such as prices through emergency procurement or the spot market."


Watch more News on iWantTFC