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Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SIXTEENTH CONGRESS
First Regular Session
2496

HOUSE BILL NO.

Introduced by Rep. Winston “Winnie” Castelo

EXPLANATORY NOTE

About 4.5 million Meralco customers, captive at that, must have been
systematically robbed but cannot do anything about it

Note that as a result of a COA Audit Report, findings show overcharges of
Meralco of P8 billion in 2004 and P4 billion in 2007 which are enough to establish that
the rates granted by the Energy Regulatory Commission (ERB) to Meralco in May 2003
was indisputably unjust and unreasonable

In this light, this bill calls for a regular regulatory audit of Meralco to be
undertaken by COA and for that matter, similar power utilities or distributors such as the
Visayan Electric Co. or Veco in Cebu.

Truly, there is a need to review the reach of Republic Act No. 3019, otherwise
known as the Anti-Graft and Corrupt Practices Act in so far as action or inaction ‘by
Officials of the ERC might have given Meralco ‘unwarranted benefits, advantage or
Preference’ by wanton approval of every request of increase of power rates.

This bill seeks to protect end-users, consumers and customers solely and largely
dependent on Meralco for their power requirements which already had a fong history of
having raked so much profits way above what should have been set as ‘just and
reasonable rates’ to allow return-on-rate base for it to operate viably.

In fact, under these conditions, Meralco shall be compelled to refund to the
consuming public all overcharges that are deemed unreasonablyor unjustly imposed.

This bill strikes a balance between the profit motive of kmpanies and
the benefits of the consuming public, hence the urgent pagsage of this ill is prayed
most earnestiy.


Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

SIXTEENTH CONGRESS
First Regular Session

HOUSE BILLNO.__ 2496

Introduced by Rep. Winston “Winnie” Castelo

AN ACT
MANDATING REGULAR REGULATORY AUDIT OF MERALCO BY
COMMISSION ON AUDIT AS PRINCIPAL BASIS FOR VALIDATION OF RATES.
AS MAY BE GRANTED BY THE ENERGY REGULATORY COMMISSION ON
‘SUCH POWER UTILITIES AND DISTRIBUTORS AND FOR OTHER PURPOSES:

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

SECTION 1. This Act shall be known as the ‘Power Rate Validation Act of
13"

SEC. 2. Under this Act, the Commission on Audit is mandated to conduct
regular regulatory audit of Meralco and such power utilities and distributors as
principal basis for validation of rates as may be granted by the Energy Regulatory
‘Commission on requests for power rate increases.

It shall serve as a check-and-balance mechanism against otherwise
unreasonable rates that could inflict social and economic costs to various end-users,
customers and the consuming public in general.

SEC. 3. Prohibition. — It shall be prohibited for Meralco or similar power
utilities and distributors to fail to comply with the provision of this Act and violation
hereof shall compel such power utilities and distributors to refund overcharges
beyond the prescribed reasonable rates.

SEC. 4. The Commission on Audit shall issue appropriate guidelines to
effectively carry out the provisions of this Act.

SEC. 5. All issuances, laws, decrees, orders, rules and regulations or parts
thereof not consistent with this Act are hereby repealed or modified accordingly.

SEC. 6. This Act shall take effect ninety (90) days following its publication in
‘the Official Gazette and in at least three (3) newspapers of general circulation.

Approved, y