LKI 2020-036 PRESS STATEMENT
JUNE 16, 2020
MURANG KURYENTE ACT: THE CONSUMERS CONUNDRUM
No. 11371 was signed by President Rodrigo Duterte on August 8, 2019 , and became effective fifteen (15 ) days after its publication in the Official
Gazette on August 14, 2019. The law was
primarily authored and sponsored by Senator Win Gatcchallian and Congressman Lord Alan
The hype and nucleus of the law is that the consumers will no longer shoulder paying for the stranded debts and stranded
contract costs of the then National Power Corporation , which has since been
transferred to another governmment corporation called the Power Sector Assets
and Liablility Management Corporation or PSALM .
In 2019, consumers paid a
total of Php 0.0971 /kwh . As of date
the stranded debts amounts to Php 0.0428 /kwh.
It was estimated during the Congressional hearing ,that for the rest of
the corporate life of PSALM , the consumers will pay an additional amount of
Php 0.86 /kwh.
As of date the consumers
continue to pay the stranded debts . And looking ahead , consumers do not see
receiving a reprieve and enjoying the benefits of the law. If at all, and maybe until year 2022 at the earliest, if the
intricate budgeting and appropriatons rules and regulations are complied with ,
by the same government agencies who
crafted the Implementing Rules and regulations and are tasked to implement the
Taking the cudgels on behalf
of electricity consumers considering the
stranded costs continue to be shouldered by the consumers, at the
beginning of the year, on January 2,
2020, the Laban Konsyumer Inc. filed a
Petition before the Energy
Regulatory Commission to stop PSALM from
colllecting stranded contract costs and
debts from all consumers.
Our arguments simply stated
, Atty. Vic Dimagiba , Laban Konsyumer Inc. President said, that consumers should immediately benefit from the
law, and that the protocols and procedures in the implementation of the law are solely internal amongst the implementing agencies .
Otherwise stated , Laban Konsyumer pleaded as follows:
Section 4 of the law said that the Malampaya
Funds shall be utilized for the payment of the stranded contract costs and
stranded debts . The reduction of the electricity rates was made possible by
allocating a portion of the net national
share from the Malampaya Natural Gas project for the payment of the NPC
stranded contract costs and stranded debts . The isssuance of the Implementing
Rules and Regulations should not be a
condition precedent to the entitlement of all end users to an immediate
reprieve granted by the Murang Kuryente
Act . Consumer should not wait for the isssunce of the IRR. The consumers have
nothing to do with the proper
disposition of the Malampaya Funds, which are essentially , the responsibilty
of the implementing agencies.
After receiving the Comment from the
Solicitor General on June 11, 2020, as
Counsel of PSALM, DOE, DOF, DBM and Btr, Dimagiba said that the Murang Kuryente Act became increasingly of
no value to the consumers, confusing ,
and raised difficult questions for the consumers.
In Paragraph 21 of the Comment of the Solicitor General , it said Indeed,
consumers need not be flustered or bothered by the intricacies and rigors of
government protocols concerning this law. However, the establishment of the
procedures and requirements of the allocation and appropriation of the funds
under the Murang Kuryente Act , through the issuance of the IRR , is essential
for the orderly, systematic , effective and efficient implementation of the Act.
In addition, with guts , paragraph 24 of the Solicitor General’s
Comment , added to the confusion in the
implementation of the Act. The paragraph said
that the use of the Malampaya
Funds for payment of the universal
charges is merely permissible, not mandatory , as clearly provided for
in the last paragraph of Section 4- the universal charge for stranded contract costs and
stranded debts currently being collected may be covered by the allocated amount from the
Malampaya fund subject to the
implementing rules and regulations . It
cited Belgica vs. Ochoa , Jr. that the
word may should not be construed to
mean shall or must .
And cementing the
consumers conundrum, and it appearing to
be supportive of the Laban Konsyumer Petition pending in the ERC, in paragraph
30 of the Solicitor General’s Comment,
it stated that the Murang Kuryente Act likewise provides that
no universal charges for stranded costs and stranded debts shall be
collected upon the effectivity of the IRR. Relatedly,
pursuant to Section 4 above, the universal charges currently being collected
may be covered by the allocated amount from the Malampaya Fund , subject to the
As they say in
Pilipino, Para kang pumapasok sa butas ng karayom
, Dimagiba quipped.
Hopefully, the ERC decides
the case in favor of the connsumers. On the other hand , granting that the
regulator , ERC, agrees with the Solicitor General, there is no firm
timeline when the consumers shall enjoy the
benefits of the Murang Kuryente Act. Dimagiba asked, A good law turns bad law?.
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