Republic of the Philippines


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ERC Grants Provisional CPCN to PECO

The Energy Regulatory Commission (ERC) granted a provisional Certificate of Public Convenience and Necessity (CPCN) to Panay Electric Company, Inc. (PECO) to ensure uninterrupted supply of electricity in Iloilo City.  The ERC’s resolution is embodied in an Order dated 21 May 2019 issued upon the ERC en banc deliberation.  

 “Under the law, we (the ERC) are authorized to grant PECO the necessary provisional CPCN during the interim period or until More Electric and Power Corporation (MORE), the legislative franchisee, has established and can fully operate its own distribution system”, ERC Chairperson and CEO Agnes VST Devanadera stated.  

Section 17 of Republic Act No. 11212, entitled “An Act Granting More Electric and Power Corporation (MORE) a Franchise to Establish, Operate, and Maintain, for Commercial Purposes and in the Public Interest, a Distribution System for the Conveyance of Electric Power to the End Users in the City of Iloilo, Province of Iloilo, and Ensuring the Continuous and Uninterrupted Supply of Electricity in the Franchise Area”, specifically provides that PECO shall in the interim be authorized to operate the existing distribution system within the franchise area, as well as implement its existing power supply agreements with generation companies that had been provisionally or finally approved by the ERC.  PECO shall operate the distribution system until the establishment or acquisition by the grantee MORE of its own distribution system and its complete transition towards full operations, which period shall in no case exceed two (2) years from the grant of the legislative franchise.

The ERC’s provisional CPCN granted to PECO is subject to the following conditions:

(a)    The issuance of an Order granting a Provisional CPCN in favor of PECO covers only the “Interim Period” in order to ensure uninterrupted supply of electricity in Iloilo City;

(b)    PECO shall settle the full amount of refund pursuant to the Commission’s Order dated 16 November 2009, in ERC Case No. 2001-333 (96-26), not later than 30 June 2019.  PECO shall  submit a report within five (5) days from 30 June 2019; and

(c)    The Provisional CPCN in favor of PECO shall be automatically revoked and shall cease to have any force and effect, subject to the provision of Section 10 of R.A. No. 11212.

“I would like to underscore the provision of the law that the provisional CPCN granted to PECO during the transition period shall not be construed as extending the franchise of PECO which has expired on January 18, 2019.  MORE, on the other hand, can exercise its right of eminent domain whereby it may acquire such private property that is actually necessary to enable it to perform its obligation to provide uninterrupted supply of electricity in Iloilo City”, Chair Devanadera emphasized.  


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