There’s a strong belief, even from pundits and naysayers, that Senate’s approval of a new franchise in favor of MORE Electric and Power Co. will result in complications. Not only does it mean the displacement of Panay Electric Co. (PECO), it also means the disruption of electric service in the entire Iloilo region.
Of interest in the looming takeover of PECO are the nagging questions that need immediate resolution. For instance, what if PECO does not agree to a takeover? In principle and under the law, the new player cannot arbitrarily use its franchise in asserting its authority because it does not own a single electric post in Iloilo City nor is it an owner of a distribution network that can supply power overnight to residences and business establishments.
Though persuasion may be possible in convincing the PECO owners to yield to the interest of Monte Oro Resources and Energy, Inc. (MORE), that assumption remains theoretical. And if in indeed such option is possible, it will be a costly gamble on the part of the new player.
In the event of a stalemate where PECO sticks to its guns by not surrendering their assets to MORE even at a fairly good price due to some sentimental reasons, the new player will need years before its facilities and installations are put in place. In the interregnum, who will provide power to Iloilo City after Congress has denied PECO’s application for a new franchise?
Of course, PECO has its own issues to address, such as exorbitant power rates and somewhat deficient distribution system. But these concerns can be resolved if the legislature sets conditions in the issuance of franchise to PECO. Any violation of that franchise can always translate to the cancellation of the privilege to operate an electric company.
The PECO-MORE conundrum goes beyond franchising; it also has something to do with underlying and unexplored issues on why the Panay firm was allowed to operate, if indeed it does not have a franchise, for decades. Given that public utilities are subject to government audit, why did the Commission on Audit (COA) fail to conduct due diligence on PECO?
In 2008, as historical basis, the Energy Regulatory Commission (ERC) asked COA to perform the audit after President Gloria Macapagal-Arroyo’s ordered a scrutiny of the books of oil and power companies due to surging prices.
Another interesting matter that should occupy Iloilo residents and why they have to stand beside PECO is uncertainty. In the event MORE, after ironing out the kinks, fails to deliver the goods and decide instead to withdraw, what options are left for the affected consumers? With a gambler as owner of the new player, God knows what gambits he has in his mind.
Delivering the PECO territory on a silver platter looks like an option that is not acceptable to Iloilo residents. The Panay company may not be immaculately clean and has some issues to resolve, the rudimentary focus here is not takeover or sweetening the pot but the assurance that power service continues, subject to conditions Congress will impose and for the ERC to enforce.
For the PECO to survive and comply with its commitment to the public, the state regulatory agencies should use their functions in ensuring that the next chapter of PECO’s existence, if President Rodrigo Duterte’s tacit support for the Panay firm materializes, will optimistically be in favor of the city’s growth and to the satisfaction of Iloilo consumers.