ERC asserts authority to regulate SBMA energy distribution

Energy Regulatory Commission Chairman Manuel R. Sanchez has affirmed the jurisdiction of the ERC over distribution utilities operating within SBMA and other economic zones.

At a meeting held recently at the ERC offices with SBMA Chairman Felicito Payumo and Aboitiz Equity Ventures’ Jon Aboitiz, Sanchez cited the provisions of RA No. 9136 (Electric Power Reform Act of 2001) to bolster his argument.

Sanchez pointed out that Section 80 of the EPIRA repealed the provisions of RA 7916 and RA 7227 with regard to electric power. It specifically repealed the powers of the governing bodies of the Economic Zones (PEZA, BCDA) as to utilities operating within the zone.

“Section 22 of RA 9136 is explicit that the distribution of electricity shall be subject to the regulation of the Energy Regulatory Commission,” Sanchez declared.

“It made no distinction as to whoever is undertaking said distribution of electricity to be subject to ERC regulations.

“Accordingly, no entity can claim exception under the said express provision in the same law. It is the basic rule in statutory construction that when a law makes no distinction, no distinction shall be made.”

SBMA Chairman Payumo was in Metro Manila to propose a Memorandum of Agreement between SBMA and ERC that would enable the SBMA to regulate and supervise the establishment, operation, maintenance, lease or purchase of electric power utilities and service within the Subic Special Economic and Free Port Zone.

The ERC Chairman, however, opined that the ERC cannot enter into a MOA with regard to the regulation of distribution utilities by another entity, such as would be tantamount to a delegation of an already delegated power.

Citing legal jurisprudence, he said: “The power delegated to an administrative agency to fix rates cannot, in the absence of a law authorizing it, be delegated to another. What has been delegated cannot be delegated. this doctrine is based on the legal principle that such a delegated power constitutes not only a right but a duty to be performed by the delegate through the instrumentality of his own judgment and not through the intervening mind of another. A further delegation of such power would indeed be a negation of the duty in violation of the trust reposed in the delegate mandated to discharge it directly.” (KMU Labor Center vs. Garcia Jr., 236 SCRA 386)

July 23, 2003