Senate okays bill extending Meralco franchise for another 25 years

The Senate on Monday approved on third and final reading House Bill No. 10926, which seeks to extend Manila Electric Company’s (Meralco) franchise for another 25 years.

At least 18 senators voted in favor of the proposed measure, while only one senator — Senator Risa Hontiveros — voted against it. No senators abstained from voting.

Under House Bill No. 10926, Meralco will be allowed to continue to construct, operate, and maintain its electric distribution systems in areas such as Metro Manila, Bulacan, Cavite, Laguna, Quezon, Pampanga, Batangas and Rizal.

The utility company — currently the largest power distributor in the country — is serving 38 cities and 78 municipalities, or 7.6 million customers.

‘No’ vote

Explaining her “no” vote, Hontiveros stressed that Meralco, over the past years, has “failed to fulfill its obligations and serve consumers, as reflected by our excessively high electricity bills.”

“Before even considering a franchise renewal, my view is that Meralco must first be made to properly refund its customers for its past over-collections,” she said.

“Recently, Meralco itself, by volunteering to initiate refunds with the Energy Regulatory Commission (ERC), admitted that it has overcharged consumers. This over-collection needs to be addressed before any further steps are taken,” she added.

Hontiveros also noted that all her proposed amendments to the bill — which she described as the bare minimum needed to guarantee fair and transparent operations — were rejected.

“They would have ensured that the refunds are calculated properly, transparently, and open to public scrutiny,” she said.

“These amendments were also intended to reverse the long-term regulatory inaction and failures on the part of the ERC in its dealings with Meralco,” she added. “We cannot simply move on and forget about Meralco’s mistakes and shortcomings. It is the Senate’s duty to ensure that the public will not be taken advantage of again.”

Independent financial audit

One of the amendments Hontiveros introduced was the establishment of an independent financial audit of Meralco’s financial records through the Commission on Audit to “find out where the excessive charges went.”

“This audit must be comprehensive, looking at all financial statements, related party transactions and the calculation of the Annual Revenue Requirement,” she said.

Last week, Meralco announced that its customers can expect a refund of around 19 centavos per kilowatt-hour in the coming months, which the distributor plans to do in three years.

Hontiveros previously urged Meralco to refund an estimated P100 billion in alleged overcollections from consumers over the years.