Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

TWENTIETH CONGRESS
First Regular Session

2494

HOUSE BILL NO. © *

Introduced by Representatives
EULOGIO “LEO” R. RODRIGUEZ, Lone District, Catanduanes
PRESLEY C. DE JESUS, PHILRECA Party-list
SERGIO C. DAGOOC, APEC Party-list

EXPLANATORY NOTE

The First Catanduanes Electric Cooperative, Inc. (FICELCO), established on
October 28, 1971, is a non-stock, non-profit electric distribution utility duly organized
and registered under the National Electrification Administration (NEA). It was granted
a franchise to operate electricity distribution services to member-consumer-owners
(MCOs) of the island province of Catanduanes, serving the municipalities of
Bagamanoc, Baras, Bato, Caramoran, Gigmoto, Pandan, Panganiban, San Andres, San
Miguel, Viga, and Virac.

As the province's sole power distributor, FICELCO plays a vital role in the socio-
economic development of Catanduanes. It has successfully achieved one hundred
percent (100%) electrification of the province's 315 Barangays, serving more than
42,000 MCOs. Additionally, FICELCO has consistently maintained high performance
and operational standards despite the recurring damage caused by typhoons. The
cooperative has significantly reduced system loss to 8%, minimized power
interruptions, and maintained a high level of collection efficiency, accomplishments
reflected in its “AAA” rating in the 2024 Electric Cooperative (EC) Overall
Performance Assessment released by the NEA on May 16, 2025, a testament to its
commitment to service reliability and financial stewardship.

Considering the provisions of Section 27 of Republic Act No. 9136, otherwise
known as the Electric Power Industry Reform Act (EPIRA), stating that the authority
to grant franchises for electric transmission and distribution is vested exclusively in the
Congress of the Philippines, this bill secks the grant of a legislative franchise to
FICELCO. Once approved, the franchise will ensure the uninterrupted delivery of
affordable, efficient, and safe electricity services to the people of Catanduanes.

Notably, the House of Representatives had already approved this bill seeking to
grant a legislative franchise to FICELCO on Third Reading during the 19th Congress.
However, due to lack of material time, the Senate was unable to consider and approve


the said measure. In this view, to sustain the operations of the clectric cooperative and
protect the welfare of its MCOs, this representation has filed the same bill in the 20th
Congress.

In view of the foregoing, the immediate passage of this bill is earnestly sought.

fiza n aavacuEZ

EULOGIO

SLEY C. DE JESUS

SERGIO“. DAGOOC


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City, Metro Manila

TWENTIETH CONGRESS
First Regular Session

2494

HOUSE BILL NO.

Introduced by Representatives

EULOGIO “LEO” R. RODRIGUEZ, Lone District, Catanduanes
PRESLEY C. DE JESUS, PHILRECA Pai
SERGIO C. DAGOOC, APEC Party-list

AN ACT
GRANTING A FRANCHISE TO FIRST CATANDUANES ELECTRIC
COOPERATIVE, INC. (FICELCO) TO CONSTRUCT, INSTALL, ESTABLISH,
OPERATE, OWN, MANAGE, AND MAINTAIN DISTRIBUTION SYSTEMS FOR
THE CONVEYANCE OF ELECTRIC POWER TO END-USERS IN THE
MUNICIPALITIES OF BAGAMANOC, BARAS, BATO, CARAMORAN, GIGMOTO,
PANDAN, PANGANIBAN, SAN ANDRES, SAN MIGUEL, VIGA, AND VIRAC,
ISLAND PROVINCE OF CATANDUANES

Be it enacted by the Senate and the House of Representatives of the Philippines in the
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 to First
Catanduanes Electric Cooperative, Inc. (FICELCO), hereunder referred to as the Grantee, its
successors or assignees a franchise to construct, install, establish, operate, own, manage and
maintain in the public interest and commercial purposes, distribution systems for the
conveyance of electric power to the end-users in the Municipalities of Bagamanoc, Baras, Bato,
Caramoran, Gigmoto, Pandan, Panganiban, San Andres, San Miguel, Viga, and Virac, Island
Province of Catanduanes.

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 pointfacility of the end-users.

SEC. 2. Manner of Operations of Facilities. ~ All electric distribution facilities, lines
and systems for electric services installed, owned, operated, managed or maintained by the
Grantee, its successors or assignees, shall be operated or maintained at all times in a superior
manner, and it shall be the duty of the Grantee, its successors or assignees, 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 the National Electrification Administration (NEA),
or its legal successor, or any other government agency concemed 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.

SEC. 3. Authority of the ERC and NEA. ~ The Grantee shall secure from the ERC or
the NEA or any government agency having jurisdiction over its operations, the Certificate of
Public Convenience and Necessity (CPCN) and any other license, permit or authority
indispensable for the construction and operation of the electric power distribution system.

SEC. 4. Excavation and Restoration Works. - 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 Grantee, 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 shalll 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.

SEC. 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 ERC, the Grantee shall modify, improve, or change its facilities,
poles, lines, systems, and equipment for the purpose of providing efficient and reliable servi
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 businesses and
industries shall be able to compete.

‘The Grantee shall have the obligation to provide open and non-discriminatory 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
competitiveness of businesses and industries.



SEC. 6. Rates of 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 lifeline rate to marginalized end-users as mandated under RA No. 9136

SEC. 7. Promotion of Consumer Interests. ~ The 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.

SEC. 8. Commitment to Provide and Promote the Creation of Employment
Opportunities. - The Grantee shall create employment opportunities and shall allow on-the-
job training in their franchise operation: Provided, That priority shall be accorded to the
residents where their principal office is located: Provided, further, That the Grantee shall
comply with the applicable labor standards and allowance entitlement under existing labor
Jaws, rules and regulations, and similar issuances.

SEC. 9. Rights 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.

SEC. 10. 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 its 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.

SEC. 11. Term of Franchise. Unless sooner cancelled, this 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

SEC. 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 injury to persons or
damage to property, during the construction, installation, operation, and maintenance of the
distribution system of the Grantee.



SEC. 13. Liability to Damages. - The Grantee shall be liable for any injury to persons
and damage to property 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.

SEC. 14. Sale, Lease, Transfer, Usufruct, or Assignment of Franchise. — The Grantee
shall not sell, lease, transfer, grant the usuftuct 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 transfer the controlling interest
of the Grantee, whether as a whole or in part, and whether simultaneously or
contemporaneously, to any such person, firm, company, corporation, or entity without the prior
approval of the Congress: Provided, That Congress shall be informed of any lease, transfer,
grant of 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 ot entity to which this franchise is sold, transferred, or
assigned, shall be subject to the same conditions, terms, restrictions, and limitations of this Act.

SEC. 15. Reportorial Requirement. ~ The Grantee shall submit an annual report to
Congress, 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 this 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 ERC.

SEC. 16. Fine. ~ The failure of the Grantee to submit the requisite annual report to.
Congress shall be penalized with a fine in the amount of Five hundred pesos (P500.00) per
working day of non-compliance 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.

SEC. 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.

SEC. 18. Applicability of Existing Laws. ~ The Grantee shall comply with and be
subject to the provisions of Commonwealth Act No. 146 or the “Public Service Act”, as
amended and RA No. 9136, and RA No. 1053 or the “National Electrification Administration
Reform Act of 2013”.

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


SEC. 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.

SEC. 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.

SEC. 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.

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

Approved,