The Manila Electric Company can now increase its power rate after the Court of Appeals affirmed with finality its decision issued last 27 June 2023 that annulled the Energy Regulatory Commission's decision denying the application for a rate hike.

The rate hike was jointly filed by the power units of Ramon Ang-led San Miguel Corporation and Meralco.

The CA's Thirteenth Division, in a decision dated 28 December 2023, junked the motion filed by ERC and National Association of Electricity Consumers For Reforms, Inc. seeking the reversal of the said decision penned by Associate Justice Charlene Hernandez-Azura.

It said the respondents ERC and NASECOR failed to present new arguments that would warrant the reversal of its decision.

"A scrutiny of the Motions for Reconsideration reveals that the grounds relied upon by respondent-intervenor NASECOR and public respondent ERC were already thoroughly considered and passed upon in the decision being sought to be reconsidered; and that contrary to the claims of public respondent, the Court has clearly provided its basis in making its rulings," the CA said.

"Accordingly, our decision dated 27 June 2023 stands," the CA said.

On 27 June 2023, the CA granted the petition for certiorari filed by San Miguel Energy Corp. and South Premiere Power Corp. seeking to nullify the order of the ERC denying their bid for an electricity rate hike.

The CA said the ERC gravely abused its discretion when it rejected the joint motion for price adjustment filed by SMC's power units and Meralco on 29 September 2022 despite the substantial evidence justifying the same.

SPPC manages the natural gas-fired power plant in Ilijan, Batangas, while SMEC is responsible for the coal power plant in Sual, Pangasinan. Both units are subsidiaries of San Miguel Global Power, the power arm of San Miguel Corp.

SPPC, SMEC and Meralco sought the price adjustments to serve as temporary relief for a combined P5.2 billion in alleged losses incurred from January to May 2022 due to the spike in fuel prices.

SPPC is required to supply power to Meralco with 670MW net baseload capacity from the output of the 1,200 MW of the Ilijan Power Plant, the Wholesale Electricity Spot Market (WESM) or any other source, while SMEC is required to supply power to MERALCO with 330MW net baseload capacity from the output of the 1200 MW of the Sual Power Plant, the WESM or any other source.

Both PSAs cover a supply period of 10 years from 26 December 2019 to 25 December 2029. In denying ERC and NASECOR's appeal, the CA declared: "Thus, the Court finds no merit in the arguments set forth in their respective motions for reconsideration. Accordingly, there is no cogent reason to reverse the Court's Decision dated 27 June 2023."
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