SMC Global Power appeals to CA on ERC decision


SMC Global Power Holdings Corp. (SMCGP), the energy arm of San Miguel Corporation (SMC), is asking the Court of Appeals (CA) to reverse the Energy Regulatory Commission’s (ERC) decision denying its rate hike plea on two of its power supply agreements with Manila Electric Co. (MERALCO) 

In a report by the Philippine Star, ERC chairperson said that they received a copy of SMC’s petition last Monday. She said that SMC is asking CA to issue a temporary restraining order (TRO) on the ERC’s order and for CA to reverse the decision. 

SMCGP and MERALCO filed for a power rate hike in their PSAs after incurring a Php 15 billion loss amid high global prices and natural gas supply restrictions. 

The ERC said its decision denying the motion was in line with its mandate to protect consumer interest, guard against market abuse, and ensure transparent and reasonable prices of electricity under Republic Act 9136 or the Electric Power Industry Reform Act of 2001

SMCGP said that it may terminate its two PSAs with MERALCO if no relief would be given by the ERC. Nevertheless, the San Miguel company said that it will continue to supply power to MERALCO, albeit under protest. 

Under the ERC order, the termination of the PSA will take effect after 60 days from the receipt of the orders, while MERALCO should exhaust all remedies under the contracts to preserve them and ensure the least-cost supply for its customers. 

MERALCO has earlier entered into emergency PSAs and seeking new offers to contract 1,000 megawatts (MW) in capacity should the two PSAs be terminated. 

MERALCO, however, has yet to inform the ERC whether they have received the notice of termination SMCGP.