President Ferdinand “Bongbong” Marcos Jr. has vetoed the bill that expands the franchise area of Davao Light and Power Company (DLPC) in Davao del Norte, the Malacanang annnounced.
Under House Bill (HB) 10554, DLPC would expand its franchise area by including Tagum City, the Island Garden City of Samol (Igacos), Asuncion, Kapalong, New Corella, San Isidro, and Talaingod in in Davao del Norte.
The mentioned areas are currently covered by the Northern Davao Electric Cooperative (NORDECO).
“The president vetoed the bill proposing to expand the franchise of the Davao Light and Power Company due to, among others, its susceptibility to infringe on the franchise coverage area of the North Davao Electric Cooperative,” Press Secretary Trixie Cruz-Angeles said in a statement.
The vetoed bill would grant Davao Light an expanded franchise area for 25 years.
Marcos Jr. said that he was constrained to veto the bill due to “legal and constitutional challenge due to the apparent overlap and possible infringement into the subsisting franchise, permits, and contracts previously granted to NORDECO.
“North Davao Electric Cooperative Inc. has existing franchises in the expanded franchise which will subsist until 2028 and until 2033. The bill runs counter to the provisions of Section 27 of Republic Act No. 9136 or the EPIRA mandating that ‘all existing franchises shall be allowed to their full term,'” Marcos Jr. said.
The president added that NORDECO has existing power supply agreements with generation companies that are “provisionally or finally approved by the Energy Regulatory Commission.”
“Furthermore, the bill, while on its face, amends the franchise of another entity over the expanded area, is a prohibited collateral attack on North Davao Electric Cooperative Inc. franchise. This is contrary to a jurisprudentially settled doctrine that a franchise cannot be subjected to a ‘collateral attack,'” Marcos Jr. added.
Davao Light is the country’s third largest electric utility owned by the Aboitiz Power Corporation.
In a disclosure to the Philippine Stock Exchange on Friday, AboitizPower said that they have received information on the vetoed bill.
“Rest assured that we will cooperate with relevant authorities and respond to their directions,” AboitizPower said.