Longer Meralco franchise pushed

‘Meralco’s mandates under its franchise were clear. It has met these mandates. Hence, its franchise merits renewal,’ Salceda, who is also principal sponsor of House Bill 9793, the measure that seeks to extend Meralco’s legislative franchise after it expires in June 2028

Albay Rep. Joey Salceda

Renewal of the franchise of Manila Electric Co. (Meralco) will support the growth on areas that produce half of the country’s gross domestic product over the decades, Albay Rep. Joey Salceda said on Monday.

“Meralco’s mandates under its franchise were clear. It has met these mandates. Hence, its franchise merits renewal,” Salceda, who is also principal sponsor of House Bill 9793, the measure that seeks to extend Meralco’s legislative franchise after it expires in June 2028, said.

Those mandates, the Albay congressman said, are to ensure the least cost of power through competitive selection of energy suppliers; provide an efficient and dependable electricity distribution system; give service to everyone in its franchise area; avoid taking advantage of its market; and ensure customers are provided electricity at a reasonable price.

The chairperson of the House of Representatives’ Ways and Means Committee noted that unlike other electric cooperatives in the country as well as power companies in neighboring countries, Meralco has consistently provided electric service without government subsidy or bailouts for debt restructuring.

“In fact, Meralco contributes to the nation’s coffers as a private corporation paying corporate income tax, which it cannot pass onto consumer based on a Supreme Court ruling,” Salceda said.

Less power interruptions

Meralco’s 7.8-million customers spread across 29 cities and 72 municipalities, which is home to about a quarter of the country’s population, experience less outages, shorter power interruptions and generally lower rates compared to other local power distributors and even to some in Southeast Asia, the congressman noted.

And even if it is a natural monopoly in its franchise area, Salceda said that Meralco has not abused its market position and has actually kept its net margins at single digit. Other listed generation companies maintained margins within the 11-14 percent range while grid operations have theirs within the 45-56 percent range, the congressman noted.