September 18, 2017 By Victor V. Saulon, Sub-Editor
THE Energy Regulatory Commission
(ERC) has granted the motion for reconsideration filed by two state agencies of
its order for the payment of at least P477 million to Consunji-led Sem-Calaca
Power Corp. (SCPC).
“Wherefore, premises considered, the
Commission hereby grants PSALM’s motion for reconsideration and sets aside its
Order dated 23 June 2014,” the ERC said in an order posted this month.
Government-owned National Power
Corp. (Napocor) and Power Sector Asset and Liabilities Management Corp. (PSALM)
filed their motion for reconsideration on Aug. 29, 2014 questioning SCPC’s
motion for issuance of a writ of execution after the ERC granted the payment of
P476,703.077.96 in favor of the Consunji-led company.
The previous ERC order also called
for the payment of interest at a rate of 6% per annum computed from the date of
extra-judicial demand on Aug. 4, 2010 until the date of the actual payment,
which as of December 2013 already amounted to P95,210,011.82.
To recall, SCPC is the project
company that operates the 600-megawatt (MW) thermal coal-fired power plant in
Calaca, Batangas. The plant was among the energy assets privatized by PSALM,
and was awarded to the subsidiary of Semirara Mining and Power Corp. in
July 2009.
In October 2010, SCPC filed a
petition for dispute resolution before the ERC against Napocor and PSALM
involving over-nominations made by Napocor for the billing periods from January
to June 2010.
SCPC sought to recover the cost of
energy it sourced from the wholesale electricity spot market (WESM) in order to
meet Napocor’s requirement beyond Manila Electric Co.’s (Meralco) contracted
demand of 169,000 kilowatts (kW). The cost was charged by PSALM against SCPC.
In its September order, the ERC
sided with Napocor and PSALM, which said that before a judgment money claim may
be executed against a government-owned and -controlled corporation, the same
must first be filed with the Commission on Audit (CoA).
SCPC opposed the agencies’ motion,
arguing the fund in question is the amount that originated from Meralco’s
payment. It noted the money is not the PSALM’s property but the payment of
Meralco, which the state agency is bound to turn over to the company for the
energy supplied by SCPC to Meralco under their asset purchase agreement.
SCPC argued further that assuming
the amount it claimed from PSALM constitutes public funds, the general rule
that government funds are not subject to execution admits an exception.
To resolve the opposing submissions,
the ERC wrote a letter to CoA Chairman Michael G. Aguinaldo requesting for a
legal opinion on “whether or not the funds of PSALM can be the subject of
garnishment and in particular, whether money claims against the funds of PSALM
by virtue of an ERC judgment award should be filed before the CoA.”
In response, CoA pointed to Circular
No. 2001-002 dated July 31, 2001, which quoted in full the Supreme Court
Administrative Circular No. 10-2000 issued on Oct. 25, 2000, from which the ERC
highlighted: “Despite the rendition of a final and executory judgment
validating a money claim against an agency or instrumentality of the
government, its filing with the CoA is a sine qua non condition before payment
can be effected.”
The ERC said it “finds the PSALM’s
motion meritorious… The funds of PSALM, subject of the contribution, is a
public fund. The argument of SCPC that the monies claimed by it from PSALM are
not public funds is misplaced.”
The regulator said SCPC’s argument
arose from the nature of the source of the amount claimed, but that amount
originated from Meralco’s payment for electricity supplied by the power
generation company.
It said the payment was made through
Napocor and PSALM, which were obligated to remit the amount to SCPC. However,
when the two remitted the amount, they deducted from it the claimed amount and
paid it to WESM.
“SCPC assumed that, as the claimed
amount originally formed part of [Meralco] payment, it is private in character
and retained such nature even if it were mingled with PSALM’s funds,” the ERC
said.
But the ERC also said that the grant
of PSALM’s motion should not prevent SCPC from filing the appropriate money
claims before the CoA.
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