A Pasig City regional trial court issued a 20-day temporary restraining order in favor of Manila Electric Co., as it suspended the implementation of the Energy Department’s and Energy Regulatory Commission’s rules on retail competition and open access.
Pasig RTC branch 157 said that based on the documents presented, Meralco established compliance to the requisite requirements in support of the grant of the TRO.
“Thus, the petitioner’s prayer for temporary restraining order is hereby granted and the same is hereby issued enjoining the DOE from implementing and enforcing the DOE circular DC 2015-06-0010 and the ERC from implementing and enforcing its ERC Resolution No. 10 Series of 2016 and ERC Resolution No. 11 Series of 2016,” the court said in a decision.
The Energy Department’s and ERC’s issuances prohibited distribution utilities such as Meralco from engaging in the supply business, imposed market and other restrictions and required mandatory contestability.
The court set the hearing of the case on June 23 and if necessary on June 28 wherein the parties are asked “to show cause why a writ of preliminary injunction should or should not be issued with respect to the petitioner’s prayer for the issuance of a writ of preliminary injunction.”
The court said it had jurisdiction over the petition for declaratory relief filed by Meralco and granted the TRO, pending the trial on the merits and resolution of their respective claims.
Meralco claimed that the issuances impaired the company’s and other distribution firms’ rights under Section 29 of the Electric Power Industry Reform Act of 2009 which provides that distribution firms “have the right to engage in the business of suppling electricity to the contestable market.”
Meralco said Epira’s implementing rules also stated that the supply of electricity to end users in the contestable market required a license from the ERC “except for the supply of electricity by the distribution utilities within their franchise areas.”
Meralco said permitting the implementation of the said issuances would violate the rights of the company and the other distribution firms and cause them to suffer “irreparable injury.”
ERC resolution No. 11 states that upon effectivity, local retail electricity suppliers or local RES, can no longer market their products and services and enter into new retail supply contracts with contestable customers.
Local RES is the supplier arm of the distribution utilities which can supply electricity to the contestable customers but only within its franchise area.
Meralco said the previous DOE and ERC issuances had recognized the legal capacity of the distribution firms to participate in retail competition and open access as a supplier of electricity.
It cited the previous ERC resolution No. 01 series 2011 which states that local RES “shall be allowed to engage in the retail supply of electricity without securing RES license from ERC.”
The resolution directs the distribution firms to wind down business operations with three years from effectively but Meralco said this is “tantamount to a closure of the establishment of property.”
Another resolution issued in 2012 also stated that distribution firms may continue to provide electricity services to [contestable customers] within its franchise area as a local supplier, a separate entity.”
