ERC formally junks ‘defective’ power supply agreements

by Myrna Velasco – September 19, 2016

from Manila Bulletin

Eleven power supply agreements (PSAs) were junked by the Energy Regulatory Commission (ERC) for having ‘legally defective’ contractual terms.

The supply deals established to have been flawed were that of the Biliran Electric Cooperative and GN Power Dinginin Ltd.Co. (GNPD); La Union Electric Cooperative and GNPD; North Cotabato Electric Cooperative with Western Mindanao Power Corporation; and Camarines Sur Electric Cooperative IV and Unified Leyte Geothermal Energy, Inc.

The others were with the Cebu Electric Cooperative I and Mariveles Power Generation Corporation (MPGC); Davao del Norte Electric Cooperative, Inc. and San Miguel Consolidated Power Corporation (SMCPC); Siargao Electric Cooperative and SMCPC; Misamis Oriental Electric Cooperative, Inc. I and SMCPC; Zamboanga del Sur I Electric Cooperative and SMCPC; and Nueva Vizcaya Electric Cooperative, Inc. with San Miguel Energy Corporation.

The ERC noted “the 11 applications failed to meet the Commission’s requirements as regards verification and certification of non-forum shopping.”

Given that, the regulatory body emphasized that “the applications were deemed legally defective.”

The Commission expounded that “in the absence of any compelling reasons to rule otherwise, (it) deemed the legal defects as sufficient ground to dismiss the said applications.”

Being a quasi-judicial body, ERC Chairperson Jose Vicente Salazar stressed that they are “duty-bound to ensure that applicants and petitioners doing business in its regulated field act with truthfulness and diligence in the filing of their pleadings.”

The regulatory thus noted that “to prevent a repeat of the foregoing incident dismissal, the Commission has implemented a rigorous pre-filing process in order to ensure that applications filed before the Commission are in compliance with its requirements and resolutions.”

Based on the relevant rules issued by the ERC, it is mandatory that applications for approval of contracts must be accompanied by a verification stating that the affiant had read the pleading; and that the allegations therein shall be based on the his personal knowledge or backed by authentic records.

Additionally, the ERC rules prescribe that “applications contain a sworn certification of non-forum shopping” which shall also state that “the applicant has not commenced any action or filed any claim involving the same issues in any other court, tribunal or quasi-judicial body.”

The ERC indicated “the 11 applications have failed to validly comply with these twin requirements of verification and certification of non-forum shopping.”