Republic of the Philippines
HOUSE OF REPRESENTATIVES
Constitution Hills, Quezon City

TWENTIETH CONGRESS
First Regular Session

3949

HOUSE BILL NO.

Introduced by REP. FAUSTINO ‘BOJIE’ G. DY III, REP. ANTONIO ‘TONYPET’
T. ALBANO, REP. ED CHRISTOPHER S. GO, REP. IAN PAUL L. DY, REP.
JOSEPH S. TAN, REP. FAUSTINO MICHAEL CARLOS T. DY III,

REP. ALLAN U. TY, and REP. PRESLEY C. DE JESUS.

EXPLANATORY NOTE

Electricity lies at the core of creating opportunities, empowering communities, and
brightening futures. Since its organization and incorporation on March 24, 1972, the
Isabela | Electric Cooperative, Inc. (ISELCO-I) has remained steadfast in its mission to
provide reliable electric service to Isabelefios. The continued expansion of electrification,
specially in underserved and remote areas, fosters inclusive development and improves
the quality of life in the province of Isabela.

Thus, this bill seeks to grant ISELCO-I a legislative franchise to uphold and
continue its mandate to distribute electricity within its coverage area. Aligned with
Republic Act No. 9136, otherwise known as the Electric Power Industry Reform Act of
2001 (EPIRA), the measure reinforces ISELCO-I’s obligation to deliver transparent,
reliable, and affordable electric service to its member-consumers. It also supports the
objectives of Republic Act No. 10531 or the National Electrification Administration
Reform Act of 2013, which recognizes electric cooperatives as key partners in achieving
rural electrification and sustainable development.

The granting of this franchise affirms ISELCO-1’s long-standing commitment to
service and ensures that it can continue to respond effectively to the evolving needs of the
power sector and the communities it serves. It likewise strengthens regulatory
compliance, and supports the cooperative’s capacity to invest in infrastructure and
improved service delivery.

In pursuit of countryside development and inclusive progress, the immediate
passage of this bill in the 20th Congress is earnestly sought.


JOJIE? G. DY IIT

REP. Ep STOPHER S. GO

District, Isabela

REP. JOSEPH S. TAN}
4th District, Isabela

REP. ALLAN U. TY
LPG Marketers|Association Party-list

at ANTON! INYPET? T.

ALBANO
Ist District, Isabela

3rd District, Isdbela

MICHAEL CARLOS
DY tL
Sth District, Isabela

CDE JESUS
Philippine Resilient Electric Cooperatives
and Consumers Alliance Party-list


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Constitution Hills, Quezon City

TWENTIETH CONGRESS
First Regular Session

3949

HOUSE BILL Ni

Introduced by REP. FAUSTINO ‘BOJIE’ G. DY III, REP. ANTONIO ‘TONYPET’
T. ALBANO, REP. ED CHRISTOPHER S. GO, REP. IAN PAUL L. DY, REP.
JOSEPH S. TAN, REP. FAUSTINO MICHAEL CARLOS T. DY III,

REP. ALLAN U. TY, and REP. PRESLEY C. DE JESUS

AN ACT GRANTING A FRANCHISE TO THE ISABELA-I ELECTRIC
COOPERATIVE, INC. (ISELCO-I) TO CONSTRUCT, INSTALL, ESTABLISH,
OPERATE, OWN, MANAGE, AND MAINTAIN DISTRIBUTION SYSTEMS FOR
THE CONVEYANCE OF ELECTRIC POWER TO THE END-USERS IN THE
CITY OF CAUAYAN, CITY OF SANTIAGO, AND MUNICIPALITIES OF
ANGADANAN, SAN GUILLERMO, RAMON, SAN MATEO, SAN ISIDRO,
ALICIA, ECHAGUE, CORDON, JONES, SAN AGUSTIN, CABATUAN, LUNA,
AND REINA MERCEDES, PROVINCE OF ISABELA

Be it enacted by the Senate and House of Representatives of the Republic of the
Philippines in Congress assembled:

SECTION 1. Nature and Scope of Franchise. ~ Subject to the provisions of the
Constitution and applicable laws, rules, and regulations, there is hereby granted Isabela-I
Electric Cooperative, Inc. (ISELCO-I), hereunder referred to as the Grantee, its
successors or assigns, a franchise to construct, install, establish, operate, own, manage,
and maintain in the public interest and commercial purposes, a distribution system for the
conveyance of electric power to the end-users in the City of Cauayan and the City of
Santiago, Municipalities of Angadanan, San Guillermo, Ramon, San Mateo, San Isidro,
Alicia, Echague, Cordon, Jones, San Agustin, Cabatuan, Luna, and Reina Mercedes,
Province of Isabela.

As used in this Act, distribution system refers to the system of wires and associated
facilities, including sub-transmission lines belonging to a franchised distribution utility
extending between the delivery point on the national transmission system or generating
facility and the metering point/facility of the end-users.

SECTION 2. Manner of Operations of Facilities. — All  clectric
distribution facilities, lines, and systems for electric services installed, owned, operated,


managed, or maintained by the Grantee, its successors, or assigns, shall be operated or
maintained at all times in a superior manner, and it shall be the duty of the Grantee, its
successors or assigns, whenever required to do so by the Energy Regulatory Commission
(ERC), or its legal successor, or the Department of Energy (DOE), or its legal successor,
or any other government agency concerned to modify, improve, and change such facilities
or systems in such manner and to such extent as the progress in science or technology and
improvements or innovations in the electric power services may render reasonable and
proper.

Whenever practicable, and for purposes of maintaining order, safety, and aesthetics
along the highways, roads, streets, alleys or right-of-way, the Grantee may allow the use
of free spaces in its poles, facilities, or right-of-way by interested parties upon reasonable
compensation to the Grantee considering the costs incurred to accommodate and
administer the use of the Grantee’s facilities by such parties. The ERC shall decide in
case of dispute or disagreement between the parties.

SECTION 3. Authority of the Energy Regulatory Commission (ERC). ~ The
Grantee shall secure from the ERC or any government agency having jurisdiction over
their operations, the certificate of public convenience and necessity and any other license,
permit or authority indispensable for the construction and operation of the electric power
distribution system.

SECTION 4. Ingress and Egress. — For the purpose of erecting and maintaining
the poles or other supports for said facilities, wires or other conductors, or for the purpose
of laying and maintaining said facilities, wires, cables, or other conductors, it shall be
lawful for the Grantee, its successors, or assignees, with the prior approval of the
Department of Public Works and Highways (DPWH) or the local government unit
concerned, as may be appropriate, to make excavations or lay conduits in any of the
public places, highways, roads, streets, lanes, alleys, avenues, sidewalks, or bridges of the
province, cities or municipalities: Provided, however, That a public place, highway, road,
street, lane, alley, avenue, sidewalk, or bridge disturbed, altered, or changed by reason of
erection of poles or other supports or the underground laying of wires, other conductors
or conduits, shall be repaired and replaced in workmanlike manner by the Grantec, its
successors or assignees, in accordance with the standards set by the DPWH or the local
government unit concerned. Should the Grantee, its successors or assignees, after the ten
(10)-day notice from the grant of authority, fail, refuse or neglect to repair or replace any
part of public place, highway, road, street, lane, alley, avenue, sidewalk, or bridge altered,
changed, or disturbed by the said Grantee, its successors or assignees, then the DPWH or
the local government unit concerned shall have the right to have the same repaired and
replaced in good order and condition and charge the Grantee, its successors or assignees,
double the amount of the cost and expenses for such repair or replacement.

SECTION 5. Responsibility to the Public. ~ The Grantee shall supply electricity
to its captive market in the least costly manner. In the interest of the public good and as
far as feasible and whenever required by the NEA and ERC, the Grantee shall modify,
improve, or change its facilities, poles, lines, systems, and equipment for the purpose of
providing efficient and reliable service and reduced electricity costs. The Grantee shall


charge reasonable and just power rates for its services to all types of consumers within its
franchised areas in order that business and industries shall be able to compete.

The Grantee shall have the obligation to provide open and nondiscriminatory
access to its distribution system and services for any end-user within its franchise area
consistent with Republic Act (RA) No, 9136, otherwise known as the "Electric Power
Industry Reform Act of 2001". The Grantee shall not engage in any activity that will
constitute an abuse of market power such as unfair trade practices, monopolistic schemes,
and other activities that will hinder the competitiveness of business and industries.

SECTION 6. Rates for Services. — The retail rates and charges for the distribution
of electric power by the Grantee to its end-users shall be regulated by and subject to the
approval of the ERC or its legal successor.

‘The Grantee shall identify and segregate in its electricity bill to the end-users the
components of the retail rate pursuant to RA No. 9136, unless otherwise amended. Such
rates charged by the Grantee to the end-users shall be made public and transparent. The
Grantee shall implement a lifeline-rate to marginalized end-users as mandated under RA
No. 9136.

SECTION 7. Promotion of Consumer Interests. ~ The herein Grantee shall
establish a consumer desk that will handle consumer complaints and ensure adequate
promotion of consumer interests. The Grantee shall act with dispatch on all complaints
brought before it.

SECTION 8. Right of the Government. — A special right is hereby reserved to
the President of the Philippines, in times of war, rebellion, public peril, calamity,
emergency, disaster or disturbance of peace and order: to temporarily take over and
operate the stations or facilities of the Grantee; to temporarily suspend the operation of
any station or facility in the interest of public safety, security and public welfare; or to
authorize the temporary use and operation thereof by any agency of the government, upon
due compensation to the Grantee, for the use of the stations or facilities during the period
when these shall be so operated.

SECTION 9. Right of Eminent Domain. — Subject to the limitations and
procedures prescribed by law, the Grantee is authorized to exercise the right of eminent
domain insofar as it may be reasonably necessary for the efficient maintenance and
operation of services. The Grantee is authorized to install and maintain its poles, wires,
and other facilities over and across public property, including streets, highways, forest
reserves, and other similar property of the Government of the Philippines, its branches, or
any of its instrumentalities. The Grantee may acquire such private property as is actually
necessary for the realization of the purposes for which this franchise is granted: Provided,
That proper expropriation proceedings shall have been instituted and just compensation
paid.

SECTION 10. Term of Franchise. — Unless sooner cancelled, the franchise shall
be in effect for a period of twenty-five (25) years from the effectivity of this Act. This
franchise shall be deemed ipso facto revoked in the event the Grantee fails to operate
continuously for two (2) years.


SECTION 11. Acceptance and Compliance. — Acceptance of this
franchise shall be given in writing to the Congress of the Philippines, through the
Committee on Legislative Franchises of the House of Representatives and the Committee
on Public Services of the Senate within sixty (60) days from the effectivity of this Act.
Upon such acceptance, the Grantee shall exercise the privileges granted under this Act.
Nonacceptance shall render the franchise void.

SECTION 12, Warranty in Favor of the National and Local Governments. - The
Grantee shall hold the national, provincial, city, and municipal governments of the
Philippines free from all claims, accounts, demands, or actions arising from accidents
causing injuries, whether to persons or damage to properties, during the construction,
installation, operation, and maintenance of the distribution system of the Grantee.

SECTION 13. Liability for Damages. - The Grantee shall be liable for any injury
to persons and damage to properties arising from accidents by reason of any defective
construction under this franchise or of any neglect or omission to keep its poles and wires
in safe condition.

SECTION 14. Sale, Lease, Transfer, Usufruct, or Assignment of Franchise. —
The Grantee shall not sell, lease, transfer, grant the usufruct of, or assign this franchise or
the rights and privileges acquired thereunder to any person, firm, company, corporation,
or other commercial or legal entity, or merge with any other corporation, or entity, or
shall transfer the controlling interest of the Grantee, whether as a whole or in parts, and
whether simultaneously or contemporaneously, to any such person, firm, company,
corporation, or entity without the prior approval of the Congress of the Philippines:
Provided, That Congress shall be informed of any lease, transfer, granting the usufruct of,
sale, or assignment of franchise or the rights and privileges acquired thereunder, or of the
merger, or sale of the controlling interest within sixty (60) days after the completion of
said transaction: Provided further, That any such transfer, sale, or assignment is in
accordance with the constitutional limitations: Provided furthermore, That failure to
report to Congress such change of ownership shall render the franchise ipso facto
revoked: Provided finally, That any person or entity to which this franchise is sold,
transferred, or assigned, shall be subject to the same, conditions, terms, restrictions, and
limitations of this Act.

SECTION 15. Reportorial Requirement. ~ The Grantee shall submit an annual
report to the Congress of the Philippines, through the Committee on Legislative
Franchises of the House of Representatives and the Committee on Public Services of the
Senate, on its compliance with the terms and conditions of the franchise and on its
operations on or before April 30 of every year during the term of the franchise. The
reportorial compliance certificate issued by Congress shall be required before any
application for permit or certificate is accepted by the NEA and ERC.

SECTION 16. Fine. — The failure of the Grantee to submit the requisite annual
report to Congress shall be penalized by a fine in the amount of Five hundred pesos
(P500.00) per working day of noncompliance which shall be collected by the ERC. The
fine shall be collected separately from the reportorial penalties imposed by the ERC and
shall be remitted to the Bureau of the Treasury.


SECTION 17. Equality Clause. — Any advantage, favor, privilege, exemption, or
immunity granted under existing franchises, or which may hereafter be granted, upon
prior review and approval of Congress, shall become part of this franchise and shall be
accorded immediately and unconditionally to the herein Grantee: Provided, however, That
the foregoing shall neither apply to nor affect provisions concerning territory covered by
the franchise, the life span of the franchise or the type of service authorized by the
franchise: Provided, further, That the foregoing shall not apply to the sale, lease, transfer,
grant of usufruct, or assignment of legislative franchises with prior congressional
approval.

SECTION 18. Applicability Clause. — The Grantee shall comply with and be
subject to the provisions of Commonwealth Act No. 146, as amended, otherwise known
as the "Public Service Act" and RA No. 9136 and Republic Act No. 9136, otherwise
known as the “Electric Power Industry Reform Act of 2001.”

SECTION 19. Repealability and Non-Exclusivity Clause. — This franchise shall
be subject to amendment, alteration, or repeal by the Congress of the Philippines when
the public interest so requires and shall not be interpreted as an exclusive grant of the
privileges herein provided for.

SECTION 20. Existing Powers. - Existing mandates, powers, functions, and
privileges granted to electric cooperatives under existing laws, including Section 10 of
RA No. 10531, otherwise known as the “National Electrification Administration Reform
Act of 2013”, shall remain valid and effective, unless expressly repealed by succeeding
laws.

SECTION 21. Separability Clause. — If any of the sections or provisions of this
Act is held invalid, all other provisions not affected thereby shall remain valid.

SECTION 22. Repealing Clause. — All laws, presidential decrees,
executive orders, letters of instruction, administrative rules and regulations or parts
thereof which are contrary to or inconsistent with the provisions of this Act are hereby
repealed or modified accordingly.

SECTION 23. Effectivity Clause. — This Act shall take effect fifteen (15) days
after its publication in the Official Gazette or in a newspaper of general circulation.

Approved,