More power firms in Meralco rate hike lawsuit

Business World Online

Posted on January 10, 2014 07:51:30 PM

THE SUPREME Court (SC) ordered on Friday the inclusion of more power producers in the lawsuit involving a record Manila Electric Co. (Meralco) rate hike.

In a two-page order issued Jan.10, the SC granted Meralco’s request to include the power producers as parties. The utility, in its 139-page comment, cited the necessity to include generating companies (GenCos), Philippine Electricity Market Corp. (PEMC) and National Grid Corp. of the Philippines (NGCP) as "indispensable parties".

Power producers now sued in the case are:
• First Gas Power Corp.
• South Premiere Power Corp.
• San Miguel Energy Corp.
• Masinloc Power Partners Co. Ltd.
• Quezon Power (Phils.) Ltd. Co.
• Therma Luzon, Inc.
• Sem-Calaca Power Corp.
• FGP Corp.
• 1590 Energy Corp.
• AP Renewables, Inc.
• Bac-Man Energy Development Corp. / Bac-Man Geothermal Inc.
• First Gen Hydro Power Corp.
• GNPower Mariveles Coal Plant, Ltd. Co., 
• PANASIA Energy Holdings, Inc.
• Power Sector Assets & Liabilities Management Corp. (PSALM)
• SN Aboitiz Power
• Strategic Power Development Corp.
• Trans-Asia Power Generation Corp.
• Vivant Sta. Clara Northern Renewables Generation Corp.

The SC earlier ordered the inclusion of a number of power producers, citing supply agreements with the utility at the time of the adjustment. PEMC was also included in the case.

"Public records show that SEM-Calaca Power Corp., Masinloc Power Partners Corp., Therma Luzon Inc., San Miguel Energy Corp., South Premiere Power Corp., and Therma Mobile Inc., have ... supplied Meralco with power during November 2013 when the generation costs increased," a five-page Jan. 9 order stated.

Transmission service provider NGCP and PSALM were also added as parties.

"As exhaustively explained ... the GenCos, PEMC and NGCP stand to be injured or benefited by the outcome of the consolidated petitions, which ultimately seek to permanently enjoin Meralco from recovering the automatic increase in generation charge," Meralco stated in its comment.

"Moreover, the consolidated petitions question the constitutionality of ... EPIRA (Electric Power Industry Reform Act of 2001) and the validity of the regulations pertaining to automatic adjustments, which affect the sector of the GenCos."

The SC gave the additional parties until Dec. 20 to file their comments on the petition and required them to attend the preliminary conference on Jan. 13. The power producers, upon manifestation, could opt to waive their right to participate in the oral argument.

The high court also treated Meralco’s counter-petition as a "third-party complaint".

A 60-day temporary restraining order (TRO) has been in effect since last month on the implementation of a P4.15-per-kilowatt-hour rate hike, a portion of which was supposed to have been collected in December.

Petitioners questioned the power rate increase before the high court, citing violations to their constitutional right to due process when the adjustment was approved without the requisite public hearing announcements and publication in newspapers.

Meralco’s controlling stakeholder, Beacon Electric Asset Holdings, Inc., is partly owned by Philippine Long Distance Telephone Co. (PLDT). Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld. -- Mikhail Franz E. Flores   source