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 Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City, Metro Manila 
NINETEENTH CONGRESS 
2nd Regular Session 
House Bill No. ________ 
Introduced by Representative ERIC GO YAP 
EXPLANATORY NOTE 
Benguet’s peculiar topography remains to be a constant challenge to its continued 
development—considering the province’s steep slopes and little to none road access. 
Such predicament consequently translates to difficulty in providing electrification to 
the province’s far-flung local communities. Hence, the province’s constituents remain 
to be living in the dark—pitch black—for years. The implementation of Philippine 
Rural Electrification Program (REP) lead the way in electrifying the far-flung local 
communities primarily in Benguet, which was primarily steered by the commitment 
of the Benguet Electric Cooperative, Inc. (BENECO), the sole franchise of electric, light, 
and power service in the Province.  
BENECO was organized and registered as a non-stock, non-profit service-oriented 
entity on October 5, 1973 and was granted by the National Electrification Commission 
on March 20, 1978 the sole franchise to operate an electric, light, and power service in 
the City of Baguio and Benguet province for a period of fifty (50) years. The Electric 
Cooperative plays a significant role in the Province’s energy infrastructure 
development as its franchise area comprises the 13 towns of Benguet Province 
composing of 140 barangays and 129 barangays in the City of Baguio for a total of 269 
barangays. 
The unceasing commitment of BENECO towards electrification of the Province of 
Benguet translates to the actual Performance Assessment of the National 
Electrification Administration (NEA) in 2019 where BENECO was listed as among the 
electric cooperatives in the country with 90-100% level of energization. Moreover, 
BENECO has not only pioneered the electrification of the Province of Benguet and the 
City of Baguio, but has also spearheaded globally competitive and highest quality 
standards service by consistently securing International Standards Organization (ISO) 
certifications, particularly ISO 9001:2015 across the years. BENECO was also given an 
“AAA rating”, the highest rating, by the Overall Performance Assessment of NEA in 
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2019—highlighting the Electric Cooperative’s compliance in all the parameters set 
forth for electric cooperatives. 
Apart from the aforementioned performance accomplishments of BENECO, most 
importantly, it has proven its responsibility to its consumers as its level of power 
outages is among the lowest in the country based on the System Average Interruption 
Frequency Index (SAIFI). In addition, the Philippine Rural Electric Cooperatives 
Association (PHILRECA) has annually bestowed the Ace of Tariff Award to BENECO 
for its affordable electricity rates enjoyed by its consumers.  
Thus, following the need of a legislative enactment that is solely vested in Congress 
in order to grant franchises for the transmission and generation of electricity pursuant 
to Republic Act No. 9136 or the Electric Power Industry Reform Act (EPIRA), this bill 
seeks to grant a legislative franchise to BENECO in order to ensure the continuous 
and uninterrupted supply and distribution of quality and low-cost power supply in 
the Province of Benguet and to  further pursue energy infrastructure development 
which would gradually improve the livelihood and income of the residents of Benguet 
and guarantee the safety and welfare of their local communities.  
In view of the foregoing, the approval of this Bill is earnestly sought. 
HON. ERIC GO YAP 


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Republic of the Philippines 
HOUSE OF REPRESENTATIVES 
Quezon City, Metro Manila 
NINETEENTH CONGRESS 
2nd Regular Session 
House Bill No. ________ 
Introduced by Representative ERIC GO YAP 
AN ACT 
GRANTING 
A 
LEGISLATIVE 
FRANCHISE 
TO 
BENGUET 
ELECTRIC 
COOPERATIVE, INC. (BENECO) TO CONSTRUCT, INSTALL, ESTABLISH, 
OPERATE AND MAINTAIN A GENERATION AND DISTRIBUTION SYSTEM 
FOR THE CONVEYANCE OF ELECTRIC POWER TO THE END USERS IN ALL 
THE MUNICIPALITIES OF THE PROVINCE OF BENGUET AND BAGUIO CITY. 
Be it enacted by the Senate and House of Representatives 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 to the 
Benguet Electric Cooperative (BENECO), hereunder referred to as the grantee, its 
successors or assignees, a franchise to construct, install, establish, operate and 
maintain for public interest, a generation and distribution system for the conveyance 
of electric power to the end users in the Province of Benguet and Baguio City. 
SEC. 2. Manner of Operation of Facilities. - All electric distribution facilities, 
lines, and systems for electric services owned, maintained, operated, or managed by 
the grantee, its successors or assignees, shall be operated and maintained at all times 
in the best 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 concerned, to modify, improve and change such facilities or systems in such a 
manner and to such extent as the progress in science and improvements in the electric 
power service industry may render reasonable and proper. Whenever practicable and 
for purposes of maintaining order, safety and aesthetics along highways, roads, streets, 
alleys, or easements, the grantee may allow the use of its poles, facilities, or easements 
by interested parties upon reasonable compensation. 
SEC. 3. Authority of the Energy Regulatory Commission (ERC) and the 
National Electrification Administration (NEA). - The grantee shall secure from the 
ERC and NEA or any other government agency which has jurisdiction over the 
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operation of the herein grantee, the necessary certificate of public convenience and 
necessity and other appropriate permits and licenses for the construction and 
operation of its electric distribution system, sub-transmission system and generation 
facilities. 
 
SEC. 4. Excavation and Restoration Works. - For the purpose of erecting and 
maintaining poles and other supports for wires or other conductors for laying and 
maintaining underground wires, cables, pipes or other conductors, the grantee, its 
successors or assignees, is authorized to make excavations or lay conduits in any of 
the public places, roads, highways, streets, lanes, alleys, avenues, sidewalks, or 
bridges of said province, cities and/or municipalities, subject to prior approval of the 
Department of Public Works and Highways (DPWH) or the local government units 
(LGUs) concerned: Provided, however, That any public place, road, highway, 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 or replaced in a workmanlike manner at the 
expense of the grantee, its successors or assignees, in accordance with the standards 
set by the DPWH or the LGU concerned. Should the grantee, its successors or 
assignees, after the ten (10)-day notice from the said authority, fail, refuse or neglect 
to repair or replace any part of a public place, road, highway, street, lane, alley, avenue, 
sidewalk, or bridge disturbed, altered, or changed by the said grantee, its successors 
or assignees, then the DPWH or the LGU concerned shall have the right to have the 
same repaired or replaced in good order and condition and charge the grantee, its 
successors or assignees, at double the amount of the costs 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 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. The grantee shall have the obligation to provide open and 
nondiscriminatory access to its distribution system and services to any end user 
within its franchise area consistent with Republic Act 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 any other activities that will hinder competitiveness of 
business and industry. 
 
SEC. 6. Rates for Services. - The retail rates and charges for the distribution of 
electric power by the grantee to its end user shall be regulated by and subject to the 
approval of the ERC or its legal successor. The grantee shall identify and itemize in its 
electricity bill to the end users the components of the retail rate pursuant to Republic 
Act No. 9136. 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 Republic Act No. 9136. 
 


 
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SEC. 7. Protection of Consumer Interests. - The herein grantee shall establish a 
consumer desk that will handle consumer complaints and ensure adequate protection 
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 trainings in their franchise operation: Provided, That priority shall be 
accorded to the residents where their offices are located: Provided, further, That the 
grantee shall follow the applicable labor standards and allowance entitlement under 
existing labor laws, rules and regulations, and similar issuances: Provided, finally, 
That the employment opportunities or jobs created shall be reflected in the General 
Information Sheet (GIS) to be submitted to the Cooperative Development Authority 
(CDA) annually. 
 
SEC. 9. 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 distribution system 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 said distribution 
system 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 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 condemnation proceedings shall have been instituted and just 
compensation paid. 
 
SEC. 11. Term of Franchise. - This franchise shall be for a term of twenty-five 
(25) years that shall commence from the date of expiration of BENECO's existing 
franchise, unless sooner cancelled. This franchise shall be deemed ipso facto revoked 
in the event that the grantee fails to operate continuously for two (2) years. 
 
SEC. 12. Acceptance of the Franchise. - Acceptance of the terms of this franchise 
shall be in writing to the Committee on Legislative Franchises of the House of 
Representatives and the Committee on Public Services of the Philippine Senate, within 
sixty (60) days after the effectivity of this Act. Upon giving such acceptance, the 
grantee shall exercise the privileges granted under this Act. Non-acceptance shall 
render the franchise void. 
 


 
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SEC. 13. 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, liabilities, demands, or actions arising out of accidents 
that cause injury to persons and damage to properties, during the construction, 
installation, operation, and maintenance of the distribution system of the grantee. 
 
SEC. 14. Liability to Damages. - The grantee shall be liable for any injury to 
persons and damage to property arising from or caused by accident 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. 15. Sale, Lease, Transfer, Grant of Usufruct, or Assignment of Franchise. 
- The grantee shall not sell, lease, transfer, grant the usufruct of, nor assign this 
franchise or the rights and privileges acquired thereunder to any person, firm, 
company, corporation, or other commercial or legal entity, nor merge with any other 
corporation or entity, nor shall transfer the controlling interest of the grantee 
simultaneously or contemporaneously, to any such person, firm, company, 
corporation or entity without the prior approval of the Congress of the Philippines. 
Congress shall be informed of any sale, lease, transfer, grant of usufruct, or assignment 
of franchise or the rights and privileges acquired thereunder, or of the merger or 
transfer of the controlling interest of the grantee, within sixty (60) days after the 
completion of the said transaction. Failure to report to Congress such change of 
ownership shall render the franchise ipso facto revoked. 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. 
 
SEC. 16. 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 of Public Services of the 
Philippine Senate, on its compliance with the terms and conditions of the franchise 
and on its operations on or before April 30 of the succeeding year. 
 
SEC. 17. Equality Clause. - Except for taxes and customs duties, any advantage, 
favor, privilege, exemption, or immunity granted under existing franchises, or may 
hereinafter be granted shall, upon prior review and approval of Congress, become 
part of previously granted power distribution franchises and shall be accorded 
immediately and unconditionally to the grantees of such franchises: Provided, 
however, That the foregoing shall neither apply to nor affect provisions concerning 
territory covered, term, 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 franchise 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; Republic Act No. 9136; Republic Act No. 10531 or the "National 
Electrification Administration Reform Act of 2013"; and RA 9520 or the Philippine 
Cooperative Code of 2008. 
 


 
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SEC. 19. Fine. - Any grantee who fails to submit the annual report to Congress 
shall be penalized by a fine of Five hundred pesos (P500.00) per working day of non-
compliance. The fine shall be collected separately by the ERC distinct from the 
penalties it imposes for noncompliance of its own reportorial requirements. 
 
SEC. 20. Repealability and Nonexclusivity 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. 
 
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. Effectivity. - This Act shall take effect fifteen (15) days after its 
publication in the Official Gazette or in a newspaper of general circulation. 
 
 
Approved,