Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

TWENTIETH CONGRESS
First Regular Session

House Bill No. 4478

Introduced by Representatives Nelson S. Legacion and Ai B. Fuentebella

—_—

For over four decades, the Camarines Sur III Electric. Cooperative, Inc.
(CASURECO lll) has served as a vital service-oriented electric cooperative for the
Rinconada area of Camarines Sur. Incorporated on December 2, 1975, under
Republic Act (RA) No. 6038, and operating since May 16, 1977, CASURECO III
was granted a fifty (50) year legislative franchise on June 6, 1979. This franchise
is set to expire on the same date in 2029.

The cooperative's service area corresponds to the Fifth Congressional
District of Camarines Sur, encompassing the City of Iriga; and the municipalities of
Baao, Buhi, Nabua, Bato, Bula, and Balatan.

The Rinconada district is a significant agro-fishery hub for the province. Its
fertile plains and valleys are home to vast rice fields, while the three major
freshwater bodies — Lake Buhi, Lake Bato, and Lake Baao —provide an abundant
supply of freshwater fish, including tilapia and sinarapan (the world's smallest
edible fish). The sole coastal municipality of Balatan also contributes significantly
with its rich marine resources.

The City of Iriga functions as the urban center, housing key establishments
like government offices, banks, clinics, and two major universities. These urban
and rural sectors depend on a reliable power supply to sustain their operations

Serving one hundred percent (100%) of the two hundred twenty-nine (229)
barangays approximately 114,909 member-consumers as of December 31, 2024,
CASURECO I's operational infrastructure includes a 69-kilovolt (kV) tapping point
in Brgy. San Francisco, Nabua, and eight strategically placed substations and
feeders. Given the district's continuous growth and its immense economic
contribution to the province, the consistent supply of energy is indispensable.


yy

The continued operation of CASURECO III is essential to support the

‘ongoing development and economic vitality of the Rinconada district. Therefore,
the immediate passage of a measure to extend its legislative franchise is

imperative to ensure an uninterrupted and stable power supply for all its member-
consumers.

IN. ARNIE B. FUENTEBELLA
‘ourth District, Camarines Sur



Republic of the Philippines
HOUSE OF REPRESENTATIVES
Quezon City

TWENTIETH CONGRESS
First Regular Session

House Bill No. 4478

Introduced by Representatives Nelson S. Legacion and Arnie B. Fuentebelia

AN ACT EXTENDING THE FRANCHISE GRANTED TO CAMARINES
SUR Ili ELECTRIC COOPERATIVE, INC. (CASURECO III) TO CONSTRUCT,
INSTALL, ESTABLISH, OPERATE, OWN, MANAGE, AND MAINTAIN A
DISTRIBUTION SYSTEM FOR THE CONVEYANCE OF ELECTRIC POWER TO
END-USERS IN THE CITY OF IRIGA AND MUNICIPALITIES OF BAO, BATO,
BUHI, BULA, NABUA, AND BALATAN, ALL IN THE PROVINCE OF
CAMARINES SUR, AND FOR OTHER PURPOSES

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 1987 Philippine Constitution, Republic Act No. 9136, otherwise known as the
“Electric Power Industry Reform Act of 2001 (EPIRA)," and other applicable laws,
rules, and regulations, the franchise granted to the CAMARINES SUR Ill
ELECTRIC COOPERATIVE, INC. (CASURECO Ill), hereinafter 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 for commercial
purposes, a distribution system for the conveyance of electric power to the end-
users in the City of Iriga and the municipalities of Baao, Bato, Buhi, Bula,
Nabua, and Balatan, all situated in the Province of Camarines Sur.

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 or facility of the end-users.

SECTION 2. Manner of Operation of Facilities. - All electric distribution
facilities, lines, and systems for electric services installed, owned, operated,
managed, or maintained by the Grantee, its successors or assigns, shall be

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operated or maintained at all times in 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, 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 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 highways, roads, streets, alleys, or right-of-way, the Grantee may
allow the use of these 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) and the
National Electrification Administration (NEA). The Grantee shall secure from the
ERC or the NEA 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
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 (LGU) concerned, as may be appropriate, to make
‘excavations or lay conduits in any of the public places, highways, roads, street,
lanes, alleys, avenues, sidewalks, or bridges of said 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 or replaced in an efficient manner 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 grant authority fail, refuse, or
neglect to repair or replace any part of the 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 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, 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 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

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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 No. 9136, otherwise known as the
“Electric Power Industry Reform Act of 2001." The Grantee shail 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.

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 Republic Act 9136, unless
otherwise amended. Such rates charged by the Grantee to the ends-users shall
be made public and transparent. The Grantee shall implement lifeline rate to
marginalized end-users as mandated under Republic Act No. 9136.

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

SECTION 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 its franchise operation: Provided further, That
the Grantee shall comply with the applicable labor standards and allowance
entitlement under existing labor laws, rules and regulations, and similar issuances.

SECTION 9. Right of the Government. — A special right is hereby reserved
to the President of the Republic 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 station 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 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

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realization of the purposes for which this franchise is granted: Provided, that proper
~ expropriation proceedings shall have been instituted and just compensation paid.

SECTION 11. Term of Franchise. - Unless sooner cancelled, the franchise
extension shall be in effect for a period of twenty-five (25) years from the effectivity
of this Act. This franchise shall be deemed jpso facto revoked in the event the
Grantee fails to operate continuously for two (2) years.

SECTION 12. Acceptance of the Franchise. Acceptance of the Terms of
this franchise shall be 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. Non- acceptance shall render the franchise void

SECTION 13. Warranty in Favor of 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.

SECTION 14. Liability for 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.

SECTION 15. Exemption from Income Tax and Minimum Corporate Income
Tax (MCIT). - The grantee shall be permanently exempt from the payment of
income tax and Minimum Corporate Income Tax or MCIT.

SECTION 16. Sale, Lease, Transfer, Usufruct or Assignment of Franchise.
- The Grantee shall not sell, lease, transfer, grant the usufruct, 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, 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 the said transaction: Provided further, that any such
transfer, sale, or assignment is in accordance with 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 17. 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 of Public Services of the Senate,

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‘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 ERC.

SECTION 18. 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 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.

SECTION 19. 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
Grant Provided, however, that the foregoing shall neither apply to nor affect
provisions concerning territory covered by the franchise, the life span for 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 or usufruct or
assignment of legislative franchises with prior Congressional approval.

SECTION 20. 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, RA 9136, and RA 10531 or the "National Electrification
Administration Reform Act of 2013."

SECTION 21. Existing Powers. Existing mandates, powers, functions, and
privileges granted to electric cooperatives under existing laws, including Section
410 of Republic Act No.10531, shall remain valid and effective, unless expressly
repealed by succeeding laws.

SECTION 22. Repealability 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.

SECTION 23. 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 24. 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 repealed
or modified accordingly.

SECTION 25. 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,