House panel approves Meralco franchise renewal

By Kenneth Christiane L. Basilio, Reporter

THE HOUSE COMMITTEE on Legislative Franchises has approved a substitute bill renewing Manila Electric Co.’s (Meralco) franchise for another 25 years but removed the provision for expanding its service area.

“[The initial bill] contained a provision allowing [Meralco] to serve in adjacent regions, which was removed yesterday,” Party-list Rep. Sergio C. Dagooc, a committee member, told ����ý on Tuesday. A copy of the unnumbered substitute bill was not immediately made available.

House Bill No. 9793, authored by Albay Rep. Jose Maria Clemente S. Salceda, states that “The grantee shall also be authorized to extend service to any adjacent or nearby city, municipality, barangay, or province, whenever such service is requested by its residents or inhabitants, through their Local Government Units.”

Meralco is the main power distributor for Metro Manila and nearby areas, covering 39 cities and 72 municipalities, delivering electricity to at least 7.75 million Filipinos.

The proposed measure extending Meralco’s franchise is expected to breeze through the House as it has complied with electric regulatory policies, according to Mr. Salceda.

“The role of the franchise review process in Congress is to see whether a grantee has complied with its mandates,” he told ����ý in a Viber message. “In this regard, there can be little question. Meralco has fulfilled its end of the current franchise law.”

“The franchise is possibly the single most important private bill for industrial policy in this country,” he added, noting Meralco’s role in supporting Philippine economic growth by providing power to businesses in Metro Manila.

The electric distribution company provides power to a region responsible for half of the country’s gross domestic product, Mr. Salceda noted.

Party-list Rep. Arlene D. Brosas said she will question the proposal in plenary. “You cannot give [Meralco a franchise] without it being clear to us how they will make electricity cheaper,” she said in an interview in Filipino.

Meralco acknowledged a Viber message seeking comment but did not provide a response to Ms. Brosas’ claim.

Issues raised against Meralco have been threshed out in the committee, Cagayan de Oro Rep. Rufus B. Rodriguez said in a statement.

“Practically everything has been discussed… ventilated… and answered,” he said.

The House acted on Meralco’s extension four years before its franchise expiry.

“As far as I know on [franchise renewal] rules, any entity with a franchise set to expire within five years can file for extension,” Mr. Dagooc said.

Measures seeking to extend a company’s franchise to operate first originate at the House, undergoing the same legislative process as regular bills, according to the Energy department.

Meralco’s majority owner, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT Inc.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has an interest in ����ý through the Philippine Star Group, which it controls.