The 13th Division of the Court of Appeals nullified and set aside the order of the Energy Regulatory Commission rejecting the temporary rate hike petition filed by San Miguel Corp.’s energy subsidiaries last year.
SMC said in a disclosure to the Philippine Stock Exchange Wednesday the CA annulled the ERC order dated Sept. 29, 2022 in ERC Case No. 2019-081 and ERC Case No. 2019-083 “for having been issued with grave abuse of discretion amounting to lack or excess of jurisdiction.”
SMC said it received, through Poblador Bautista Reyes Law Offices, the counsel of San Miguel Energy Corp. and South Premiere Power Corp., the CA order granting the consolidated petitions for certiorari filed by the two companies.
Manila Electric Co. said it received the CA decision which upheld the position taken by SMC and the distributor that the grant of the fuel price adjustment “is the least cost option for our customers rather than buying replacement power from WESM [Wholesale Electricity Spot Market] or other suppliers.”
“However, there are some matters in the decision that we feel need to be clarified. We are consulting with our lawyers on the legal remedies available to us including an appeal to the Supreme Court,” Meralco first vice president and head of regulatory management Atty. Jose Ronald Valles said.
Valles said to ensure the continuity of supply of electricity and avoid exposure to volatile WESM prices, it would also start negotiating for emergency power supply agreement to replace any lost capacity if San Miguel Energy Corp. terminates its PSA with Meralco as a result of the CA decision.
“Rest assured that our priority is to always ensure that we have sufficient supply at the least cost for our 7.7 million customers,” Meralco said.
The ERC said it had yet to receive a copy of the CA decision.
“We will be guided by OSG [Office of the Solicitor General] on this matter,” ERC chairperson Monalisa Dimalanta said.
Power for People Coalition convenor Gerry Arances said the CA failed to uphold public interest by granting SMC’s petition in its case against the ERC. “The court effectively releases SMC from any consequences of breaking a contract simply because it is not earning enough from a commitment it has made voluntarily,” Arances said.
SPPC and SMEC, administrators of the 1,200-megawatt Ilijan natural gas and 1,200-MW Sual coal-fired power plants, respectively, along with Meralco, sought a temporary rate hike under its 2019 power supply agreement due to “change in circumstance.” The ERC rejected the petitions.
SMC said it received, through Poblador Bautista Reyes Law Offices, the counsel of San Miguel Energy Corp. and South Premiere Power Corp. the CA order granting the consolidated petitions for certiorari of SPPC and SMEC.
The CA also granted the joint motions for price adjustment with provisional authority and/or interim relief on ERC Case No. 2019-081 and ERC Case No. 2019-083, without prejudice to any further requests for price adjustments for June 2022 onwards.
These include adjustments for SPP from June 2022 to Jan. 25, 2023 which is the date of writ of preliminary injunction and for SMEC from June 2022 to the date of the finality of the joint decision.
The CA, however, denied SMEC’s motion for partial reconsideration of the court’s Jan. 13, 2023 resolution and its application for the issuance of a WPI for being moot and academic.
The CA also made permanent the preliminary injunction issued in favor of SPPC.