THE Supreme Court (SC) has issued a temporary restraining order (TRO) stopping the Regional Trial Court in Pasig City from enforcing an injunction order against the implementation of the retail competition and open access (RCOA) system.
The TRO effectively halted legal proceedings in Special Civil Action 4149-PSG and from enforcing all orders, resolutions and decisions rendered in Special Civil Action 4149-PSG, entitled Manila Electric Co. (Meralco) v Department of Energy (DOE) and Energy Regulatory Commission (ERC). “The ERC welcomes this development. The issuance of the TRO by the Supreme Court clears the way for the full implementation by the ERC of its recently promulgated rules on RCOA, particularly those that pertain to mandatory contestabilty by December 2016,” ERC Chairman Jose Vicente Salazar said in a text message.
The SC decision, he added, is a major boost to the country’s bid to give the power of choice to the consumers.
“We are confident the industry will give its full support to the move by the Supreme Court,” Salazar said.
Officials from the DOE did not reply when sought for comment.
The SC decision was dated October 10, 2016, Meralco said, which stated it may appeal the case.
“All we can say is we will look into all possible legal options,” said Meralco Senior Vice President William Pamintuan in a text message.
The TRO was granted by Senior Associate Justice Antonio T. Carpio.
Judge Gregorio Vega Jr. of RTC Branch in Pasig City granted on June 13 Meralco’s prayer for the issuance of a TRO or a right of preliminary injunction against the DOE from implementing and enforcing its DOE Circular DC2015-06-0010, and the ERC from implementing its ERC Resolution 5, issued on March 8, as well as Resolutions 10 and 11, issued on May 12.
ERC Resolution No.5. spelled out the rules governing the issuance of licenses to retail electricity suppliers (RES).
ERC Resolution No. 10 adopted the revised rules on contestable customer (CC) or those that can choose their own electricity supplier. These are those that register an average monthly peak consumption of at least one megawatt (MW) for the past 12 months.
ERC Resolution No. 11 imposed restrictions on the operations of distribution utilities (DUs) and RES in the retail electricity market. In particular, Meralco is prohibited from engaging in the supply of electricity in the contestable market.
These resolutions effectively prohibits DUs’ Local Retail Electricity Suppliers (Local RES) from participating in the RCOA as suppliers of electricity. While they allow DU-affiliate RESs to participate in the RCOA, ERC Resolution No. 11 unduly imposed a 30-percent market cap where all RESs shall not be allowed to supply more than 30 percent of the total average monthly peak demand in the retail market.
In addition, the same resolution also prohibits RESs from supplying more than 50 percent of the capacity requirements of their affiliate CC.
ERC Resolution No. 10 and the DOE circular provide for mandatory contestability and exclude Local RESs in their scope.
The ERC already started issuing certificates of contestability to end-users with an average demand of at least 750 kilowatts (kW) and one MW.
The rules also stated the ERC would make this mandatory effective December 26 this year.
For those with an average demand of 750kW to 999kW, the mandatory date was June 26, 2017.