SC upholds ERC's Decision on rate unbundling

The Supreme Court (SC) upheld the Decision of the Energy Regulatory Commission (ERC) on MERALCO’s rate unbundling application, which resulted to the implementation of the PhP 0.17 per kilowatt-hour (kWh) average increase in its rates starting June 2003. Unbundling is the process of itemizing the specific cost components that make up a customer’s electricity bill required from distribution utilities (DUs) such as the MERALCO to make it transparent as required in the Electric Power Industry Reform Act (EPIRA).

The High Court reiterated the established rule in this jurisdiction that “findings of administrative or regulatory agencies on matters within their technical area of expertise are generally accorded not only respect but finality if such findings are supported by substantial evidence.” The SC recognized that “rate-fixing calls for a technical examination and a specialized review of specific details which the courts are ill-equipped to enter; hence, such matters are primarily entrusted to the administrative or regulating authority.”

“The SC has spoken on the validity of the ERC’s rates unbundling Decision. The ERC would like to assure the MERALCO customers that the SC ruling will not have any new impact on their electricity bills because the said PhP 0.17/kWh is already part of MERALCO’s existing rates, having been implemented as early as June 2003 when the ERC Decision became executory,” ERC Chairman Rodolfo B. Albano, Jr. said.

“The ERC is glad that the Supreme Court has recognized the independence and the technical competence of ERC as a regulatory body,” Chairman Albano added.

December 12, 2006