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

House Bill No. 2693

Introduced by Representative Timothy Joseph Cayton

“AN ACT GRANTING A LEGISLATIVE FRANCHISE TO NUEVA VIZCAYA

ELECTRIC COOPERATIVE, INC. (NUVELCO) TO CONSTRUCT, INSTALL,

ESTABLISH, OPERATE, AND MAINTAIN A DISTRIBUTION SYSTEM FOR

THE CONVEYANCE OF ELECTRIC POWER TO THE END USERS IN THE
ENTIRE PROVINCE OF NUEVA VIZCAYA”

EXPLANATORY NOTE

In pursuit of total electrification and improved service delivery, this bill seeks to grant
the Nueva Vizcaya Electric Cooperative Inc, (NUVELCO) a franchise to construct,
install, establish, operate, and maintain a distribution system for the conveyance of
electric power to end-users in the entire Province of Nueva Vizcaya.

NUVELCO has long served as the primary electric distribution utility and has been
instrumental in bringing electricity significantly contributing to the province's socio~
economic growth. It has likewise supported agricultural productivity, small
enterprises, education, healthcare, and the overall quality of life of its member
consumer-owners,

Through this franchise, NUVELCO will be better equipped to modernize its facilities,
improve system reliability, expand its coverage, and enhance its consumer protection
mechanisms, It also reinforces the government's commitment to equitable and
sustainable electrification, especially in underserved areas. Moreover, the bill
ensures transparency, accountability, and the exercise of reserved government rights
in times of national emergency, while protecting both public and cooperative
interests.

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

Lone District, Nueva Vizcaya


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

TWENTIETH CONGRESS
House Bill No. 2693

Introduced by Representative Timothy Joseph Cayton

“AN ACT GRANTING A LEGISLATIVE FRANCHISE TO NUEVA VIZCAYA

ELECTRIC COOPERATIVE, INC. (NUVELCO) TO CONSTRUCT, INSTALL,

ESTABLISH, OPERATE, AND MAINTAIN A DISTRIBUTION SYSTEM FOR

THE CONVEYANCE OF ELECTRIC POWER TO THE END USERS IN THE
ENTIRE PROVINCE OF NUEVA VIZCAYA”

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

SECTION 1. Nature and Scope of the Franchise. Subject to the provisions
of the Constitution and applicable laws, rules, and regulations, there is hereby
granted to the Nueva Vizcaya Electric Cooperative, Inc. (NUVELCO), hereunder
referred to as the grantee, its successors or assignees, a franchise to construct, install,
establish, operate, and maintain for public interest, a distribution system for the
conveyance of electric power to the end users in the entire Province of Nueva Vizcaya.

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 National Electrification Administration (NEA) 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 and improvements in the electric
power service industry may render reasonable and proper.

Wherever 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, The ERC or the NEA shall resolve cases of dispute or disagreement
between parties,

SEC. 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 other government agency which has jurisdiction over the
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.

The grantee shall have the obligation to provide open and non-discriminatory
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. 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 excavation 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 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 the 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 non-discriminatory
access to its distribution system and services to any end user within its franchise area
consistent with Republic Act No, 9136 otherwise known as "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.

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
ities. — 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 principal office is 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.

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 in so far as it may be reasonably necessary for the efficient
maintenance and operation of services. The grantee is authorized to install and
maintain 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 from the date of the effectivity of this act, 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 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.

SEC. 18. 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.

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
noncompliance. 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,