San Miguel Corp. filed a petition with the Court of Appeals to reverse the decision of the Energy Regulatory Commission denying its joint petition with Manila Electric Co. for a rate increase under their 2019 power supply agreement.
“They filed with the Court of Appeals. We just received it on Monday,” ERC chairperson Monalisa Dimalanta said in an interview at the sidelines of The Future of Renewable Energy in the Philippines forum.
Dimalanta said SMC sought a temporary restraining order against the ERC decision and a petition for certiorari.
“It means they are appealing with the CA that the ERC has no jurisdiction in the case because the issuance of the order is in excess of our jurisdiction,” she said.
“They are asking CA to issue a TRO so the order will not be implemented, and they are asking the CA to reverse the decision,” the ERC chairperson said.
Dimalanta said the ERC had referred the matter to the Office of the Solicitor General for action.
The ERC denied the petition for provisional authority and/or interim relief filed by Meralco and SMC’s power subsidiaries, saying the grounds invoked by the applicants did not fall within the “change in circumstances” definition as contemplated in the PSAs.
SMC sought to recover P5 billion worth of losses arising from the unprecedented increase in coal prices and the gas constraints from the Malampaya gas project in northwest Palawan, equivalent to P0.30 per kilowatt-hour over six months.
The ERC said the claims of massive losses from fuel-related costs for the Sual plant due to the Indonesian coal export ban and the Ukraine-Russia war were “lacking in merit and reason.”
It said San Miguel Energy Corp. should have calculated its risk assumptions and price forecasts and implemented risk-mitigating measures to ensure compliance with its long-term contractual obligations.
Two commissioners issued dissenting opinions to the decision: Alexis Lumbatan and Marko Romeo Fuentes. They said the application should have been approved as the CIC covers Change in Law that the applicants may seek interim relief from the Commission for price adjustment.
They said the rate impact simulations presented and submitted in evidence by Meralco indicated that the denial of the CIC claims would even expose the consuming public to unknown and even higher rates than granting the same, both in the short-term and in the long-term.