ERC didn’t abuse discretion in letting Meralco to hike rate – gov’t lawyers

INQUIRER FILE PHOTO

MANILA, Philippines—Government lawyers on Tuesday insisted before the Supreme Court that the Energy Regulatory Commission (ERC) did not abuse its discretion in allowing the Manila Electric Company to automatically adjust its generation cost.

Assistant Solicitor General Vida San Vicente, during Part 3 of the oral argument against the power rate hike, said adjustment of the generation cost is not included in the charges mentioned in the implementing rules and regulations of the Energy Power Industry Reform Act (Epira), which requires notice and hearing to the consumers.

“This is exempt…This exemption was brought about by the amendment of Section 4(e) which went through the process of publication and posting, public consultation, submission to the joint congressional power commission and hearing by the power commission,” San Vicente said.

The amended Section 4(e) of the Epira’s IRR provides that “any application or petition for rate adjustment or for any relief affecting the consumers” must undergo notice and hearing.

But the same section stated that exempted are the Generation Rate Adjustment Mechanism, incremental Currency Exchange Recovery Adjustment , Transmission Rate Adjustment Mechanism, Transmission True-up Mechanism, System Loss Rate Adjustment Mechanism, Lifeline Rate Recovery Mechanism, Cross-Subsidy Mechanism, Local Franchise Tax Recovery Mechanism, Business.

Still, San Vicente said safeguards are also being observed because the ERC still reviews supply contracts and the determination of the generation cost is going through an evaluation process.

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