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The Supreme Court (SC) has temporarily barred the government from implementing new regulations that compel big consumers to enter into a power-supply deal with any of the retail electricity suppliers (RES) accredited by the Department of Energy (DOE) and the Energy Regulatory Commission (ERC) by February 26.

At a press briefing, SC Spokesman Theodore O. Te said the Court issued a temporary restraining order (TRO) stopping the implementation of DOE Circular DC-2015-06-0010 and ERC Resolution 5, Series of 2016; Article I, Sections 2 and 3 thereof; ERC Resolution 10, Series of 2016;  ERC Resolution 11, Series of 2016; and ERC Resolution 28, Series of 2016.

“The Court noted that petitioners have established a clear, legal right to the TRO, considering that the Electric Power Industry Reform Act [Epira] provides for voluntary migration of end-users to the contestable market, and there appears to be no basis for the mandatory migration being ordered by the DOE and the ERC through the questioned issuances,” Te said.

The TRO was issued by the 15-man High Tribunal during the regular en banc session on Tuesday.

The DOE and the ERC both deferred comments pending receipt of the SC decision. The two agencies issued the regulations to implement the Retail Competition and Open Access (RCOA) scheme, which supposedly seeks to give customers the freedom of choice in sourcing their power requirements.

The RCOA’s implementation has been pushed back several times due to lingering court battles.

The High Court, in its decision, noted the urgent need to issue the TRO, considering the February 26, 2017, deadline imposed by the ERC for end-users to enter into a retail supply contracts with accredited RES, now numbering 27.

“If a TRO is not issued, the petition will become moot and petitioners stand to suffer grave and irreparable injury, because they will be disconnected from the distribution utility or made to pay a supplier of  last resort a 10-percent premium between the higher contracts and the Wholesale Electricity Spot Market,” the Court pointed out.

The case stemmed from the petition filed by the Philippine Chamber of Commerce and Industry, Ateneo de Manila University, San Beda College (Alabang) and mall owner Riverbanks Development Corp.

The petitioners specifically asked the High Court to immediately put a stop to the implementation of the new regulations that compel power consumers with a monthly average peak demand of 1 megawatt to abandon their current power-supply contracts and enter into new contracts with any of the 27 suppliers chosen by the ERC to supply the contestable market.

Named respondents to the suit are Energy Secretary Alfonso G. Cusi, ERC Chairman Jose Vicente Salazar, and incumbent ERC commissioners Alfredo Non, Gloria Victoria Yap-Taruc, Josefina Patricia Asirit and Geronimo Sta. Ana.

The new resolutions, according to the petitioners, would actually deprive electricity consumers of their basic constitutional right to freedom of choice.

The petitioners argued that the new regulations would limit their choice of suppliers by prohibiting distribution utilities from participating in the contestable market, even if the DUs can offer the lowest price to consumers.

They pointed out the DOE and the ERC violated the Constitution and the Epira when they issued the regulations.

The petitioners said the DOE circular and the ERC regulations in question do not promote free competition, and will lead to higher prices of electricity, affecting ordinary consumers and hurting the economy.

The petitioners lamented that the new regulations abandoned a previous policy allowing DUs and their retail supply units from competing for large consumers in the contestable market.

As a result, the regulations limited choices of large power consumers from the list of retail suppliers deemed qualified by the ERC.

The petition also protests the deadline imposed on these big power consumers to enter into new power-supply contracts at no later than February 26, 2017, or be slapped with the penalty of disconnection, or the payment of a hefty 10-percent premium on their contract price or the Wholesale Electricity Spot Market  price, whichever is higher.

The petitioners warned that the regulations could lead to an increase in the cost of their power requirements that could translate to an increase in the prices of goods and services that are detrimental to the national economy.

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