Two power firms in tug-of-war over Iloilo City franchise

Published October 4, 2018, 5:27 PM By Ben Rosario

https://news.mb.com.ph/2018/10/04/two-power-firms-in-tug-of-war-over-iloilo-city-franchise/

The tug-of-war between two power firms for the right to operate a single legislative franchise in Iloilo City has confused the House of Representatives, which is set to conduct plenary debates on the issue.

This developed as the Energy Regulatory Commission (ERC) castigated the Panay Electric Company (PECO), the sole electricity supplier in Iloilo City, for failing to refund P631 million in over-billing to its customers, adding to its woes following multiple complaints recently from customers over bills that rose by as much as 1,000 percent under a new metering scheme.

PECO is fighting off a move in the Lower House to strip it of its right to the legislative franchise for power generation in Iloilo City.

Instead, the Committee on Legislative Franchises headed by Rep. Franz Alvarez (PDP-Laban, Palawan) recommended the franchise to be granted to the MORE Minerals Corporation (MMC), a move that was assailed by the PECO management and its employees.

In a letter sent to former president and now Speaker Gloria Macapagal-Arroyo, the PECO Employes and Workers Association (PECEWA) appealed for fairness and equal treatment in deciding on which firm should be the recipient of the legislative franchise.

On Tuesday, the legislative franchises panel recommended that the legislative franchise for exclusive power distribution be awarded to MMC.

PECO, the current franchise holder, protested, saying that it has been serving Iloilo City for the past 95 yeas and continues to deliver reliable and cheap electricity to the area.

The PECO management’s appeal was backed by its workers.

“PECO employs many workers in order to maintain and operate the business of electric power distribution and conveyance to the end users in the City of Iloilo. Non-renewal of the PECO Franchise will automatically result to (sic) displacement of these workers whose families depend upon their continued employment with PECO”, the workers told Arroyo.

However, the ERC appeared to have backed the end to the PeCO franchise as its officials testified before the Lower House that the power firmed owned by the Cacho family has failed to comply with its 2014 directive to refund P631 million in over billing to its customers.

With the ERC accusation, a number of committee members agreed to deny PeCO a renewal of its legislative franchise that is due to expire in January, 2019.

Iloilo City Councilor Josuah Alim informed the House committee that the ERC also needed to intervene early this year to address multiple complaints from Iloilo residents that the utility firm suddenly raised their bills by as much as 1,000 percent without informing them of the reason.

Alim informed the House committee that a resolution in the Iloilo City Council asking the National Government to deny PECO a new franchise and for the government to take over the operations of the utility “until such time that another qualified distribution utility may come in.”.

Meanwhile, Councilor R. Leone Gerochi, author of the resolution, noted that in several cases lodged with the ERC by cause-oriented groups, PECO was “declared to have overcharged its customers on several occasions and seems to have a penchant for overbilling its consumers”.