SC: ERC can require bill deposits from consumers

The Energy Regulatory Commission’s (ERC) authority to require consumers to pay bill deposits as security for their electric bills has been upheld by the Supreme Court (SC).

A 32-page decision by the SC en banc dated 8 October 2024, stated: “The imposition of bill deposits as security for payment of electricity bills is a valid exercise of ERC’s rate-fixing power to ensure the economic viability of distribution utilities.”

Penned by Senior Associate Justice Marvic Leonen, the decision was promulgated in October 2024 but published only in January 2025.

This was issued by the SC even as it denied the petition challenging the ERC’s authority to allow distribution utilities, such as the Manila Electric Company, to collect bill deposits from their consumers.

Under the Magna Carta for Residential Electricity Consumers promulgated in 2004, residential consumers are required to pay bill deposits as a guarantee for their electric payments.

The ERC in 2007 issued guidelines to operationalize the collection and refund procedures of bill deposits.

The petitioners on the other hand assailed the legality of the provision on bill deposits under the Magna Carta in 2019, arguing that the bill deposit requirement lacked adequate regulations.

Petition denied

The High Court denied the petition for being non-justiciable and for violation of the doctrine of the hierarchy of courts.

It said the petition must also be dismissed because it is not yet ripe for adjudication.

“While we recognize the far-reaching implications of the petition, we cannot rule on these issues without issuing an advisory opinion,” the SC said.

“There is no practical value in ruling on these issues and no substantial relief can be accorded to petitioners. Judicial intervention on these issues is premature because the rules on bill deposits have yet to be finalized by the ERC,” it added.