THE Supreme Court on Tuesday stopped the Department of Energy and the Energy Regulatory Commission from implementing new regulations that compel big power consumers to get their electricity from 23 designated electricity suppliers.
During its en banc session, the SC issued a temporary restraining order against the implementation of DOE Circular No. DC-2015-06-0010 and ERC Resolution No. 5, Series of 2016; Art. I, Sections 2 and 3 thereof, ERC Resolution No. 10, Series of 2016; ERC Resolution No. 11, Series of 2016, and ERC Resolution No. 28, Series of 2016.
“The Court noted that petitioners have established a clear, legal right to the TRO considering that the [Electric Power Industry Reform Act or] Law provides for voluntary migration of end-users to the contestable market and there appears to be no basis for the mandatory migration being ordered by the DOE and the ERC through the questioned issuances,” SC spokesman Theodore Te said.
The High Court recognized the urgent need to issue the TRO considering the Feb. 26, 2017 deadline imposed by the ERC for end users to enter into a retail supply contracts with accredited retail electricity suppliers.
“If a TRO is not issued, the petition will become moot and petitioners stand to suffer grave and irreparable injury because they will be disconnected from the distribution utility or make to pay a supplier of last resort a 10 percent premium between the higher contracts and the Wholesale Electricity Spot Market,” the SC said.
The tribunal acted on the petition filed by the Philippine Chamber of Commerce and Industry, Ateneo de Manila University, San Beda College and mall owner Riverbanks Development Corp.
The petitioners specifically asked High Court to immediately put a stop to the implementation of the regulations that force power consumers with a monthly average peak demand of 1 megawatt to enter into new contracts with any of the 23 suppliers chosen by the ERC.
Named respondents to the suit are Energy Secretary Alfonso Cusi, ERC chairman Jose Vicente Salazar and incumbent ERC comissioners Alfredo Non, Gloria Victoria Yap-Taruc, Josefina Patricia Asirit and Geronimo Sta. Ana.
The new resolutions, according to the petitioners, would deprive electricity consumers of their basic constitutional right to freedom of choice.
The petitioners argued that the new regulations would limit their choice of suppliers by prohibiting distribution utilities from participating in the contestable market even if the distribution utilities can offer the lowest price to consumers.
According to them, the DoE and ERC violated the Constitution and the EPIRA when they issued said regulations.
The petitioners said the DoE Circular and ERC Regulations in question do not promote free competition and will lead to higher prices of electricity to ordinary consumers, and will have a negative impact on economy.
The petitioners lamented that the new regulations abandoned a previous policy allowing distribution utilities and their retail supply units from competing for large consumers in the contestable market.
As a result, the regulations limited choices of large power consumers from the list of retail suppliers deemed qualified by the ERC.
The petition also protests the deadline imposed on these big power consumers to enter into new power supply contracts no later than Feb. 26, 2017 or be slapped with the penalty of disconnection or the payment of a hefty 10 percent premium on their contract price or the WESM price, whichever is higher.
The petitioners warned that the regulations could lead to an increase in the cost of their power requirements that could translate to an increase in the prices of goods and services that is detrimental to the national economy.