Republic of the Philippines
HOUSE 0F REPRESENTATIVES
Quezon City
N]NETEENTH CONGRESS
Second Regular Session
'<.`'-   HOUSE BILL NO. 9147
Introduced by:  JOSEFINA a. TALLADO
ANACTGRANllNGALEGISLATIVEFRANCHISET0CAMARINESNORTEELECTRIC
COOPERATIVE,INC.(CANORECO)TOCONSTRUCT,lNSTALL,ESTABuSH,OPERATE,OWN,
MANAGE AND MAINTAIN DISTRIBUTION SYSTEMS FOR THE CONVEYANCE OF ELECTRIC
POWERT0THEEND-USERSINALLMUNICIPALIllESVVITHINTHEPROVINCEOFCAMARINES
NORTEANDENSURING"ECONTINUOUSANDUNINTERRUPTEDSUPPLY0FELECTRICITY
IN THE FRANCHISE AREA
EXPLANATORY NOTE
Camarines  Norte  is  one  of  the  provinces  in  the  Bicol  Region.   It  consists  of  twelve  (12)
municipalities, wth  Daet serving  as its capital town.  Before the founding of Camarines  Norfe  Electric
Cooperatve,  lnc.  (CANORECO),  many  homes  in  Daet town were  already  powered  by the electricity
generatedbytheDatElectricPlantownedandmanagedbyHidalgoEnterprisos.
Under the supervision of former NEA Representatves,  Mr.  Edgar E.  Jamito,  Sr.,  Cooperative
DevelopmentOfficer,andAfty.ManuelSefiar,Sr.,LegalOfficerofNEAthetownofficialsofCamarines
Norte  were  encouraged  to  organize  the  electric  cooperatve.   The  act  organizing  the   Provincial
ElectrificationCooperatveTeam(PECT),whichsupervisedthetransferofthefranchisefromtheprivate
company to CANOREC0 was signed  by former Philippine  President Ferdinand  E.  Marcos.  It was on
October 20,  1975,  when  the  Camarines  Norte  Electric  Cooperatve,  lnc.  was organized  and  the first
meetingoftheinterimboardofdirectorswasheld.Three(3)daysafter,October23,1975,CANOREC0
wasregisteredwiththeNationalElectrificationAdministration.Thisdateiscelebratedasthefoundation
or incorporation day of CANORECO.
On April  17,1978,  CANOREC0 received Franchise Certificate No.  077,  granting it the right to
operateitsfranchiseasanelectriccooperativeforfifty(50)years.SinceApril17,1978,CANOREC0has
operatedwithamandatetoascertalntotalelectificationofthemunicipalitiesofDaeLMercedes,Talisay,
Basud,  San Vicente,  San Lorenzo Ruiz, Vinzons, Labo, Capalonga,  Sta.  Elena,  Jose Panganiban and
ParacaleintheProvinceofCamarinesNorte.Hence,thecooperatve'sexistingfranehiseisduetoexpire
on April  16, 2028,


As stated in Section 27 of Republic Act No. 9136 otherwise known as the Electric Power Industry
Reform Act (EPIRA),  the Congress Of the Philippines has the exclusive power to grant congressional
franchises. This bill seeks to grant a congressional franchise to Camarines Norfe Electric Cooperative,
lnc.   (CANORECO)  to  construct,  install,  establish,  operate,  own,  manage  and  maintain  distribution
svstems for the conveyance of electric power to the end-users in all municipalities within the Province of
Camarines Norte. CANORECO shall ensure the continuous and uninterrupted supply of the electricity in
the franchise area.
Within the last forty-five  (45) years of CANORECO's operation,  it has evolved to  become  an
electric cooperative which has proved itself as an institution that can adapt to change.  It has changed,
evolved  and  pivoted  when  necessary to  address the  demands  and  needs of its member-consumer-
owners.  It has withstood the onslaught of calamities and the changes brought about by the COVID-19
pandemic.Asaresultofitsresilience,itwashailedasan"AAA"categorizedelectriccooperativebythe
National Electrification Administration (NE) since the year 2016 until 2022.  CANORECO has energized
almost one hundred percent (100%) Of the barangays within Camarines Norte.  Currently,  it has single
digitsystemlossand98°/ocollectionefficiency.CANOREC0hassuccessfullymaintainedthesupportof
its member- consumerowners through its structured Member-Consumer-Owner Organization  (MCOO)
from barangay to province-wide/EC-wide level.
TheapprovalandrealizationofthisbillwillsecureCANORECO'scontinuousandreliabledelivery
of electricity within the Province of Camarines NOTte.  In  addition,  and true to its commitment as one of
the catalyst of progress and  development in  its franchise  area,  CANOREC0 will  commit to  ascertain
accelerationoftotalelectrificationoftheprovincebyprovidingreliableandaffordablesupplyofeiectricity.
With the above, the approval of this bill is earnestly sought
JoSE#B TALLADO


Republic of the Philippines
HOUSE 0F REPRESENTATIVES
Quezon City
NINETEENTH CONGRESS
Second Regular Session
"     H0uSEBll.LNO. 9147
Introduced by:  JOSEFINA 8. TALLADO
AN ACT GRANTING A LEGISLATIVE FRANCHISE TO CAMARINES NORTE ELECTRIC
COOPERATIVE, lNC. (CANORECO) T0 CONSTRUCT, INSTALL, ESTABLISH, OPERATE, OWN,
MANAGE AND MAINTAIN DISTR[BUTION SYSTEMS FOR THE CONVEYANCE 0F ELECTRIC
POWER T0 THE END-USERS IN ALL MUNICIPALITIES VVITHIN THE PROVINCE OF CAMARINES
NORTE AND ENSURING "E CONTINUOUS AND UNINTERRUPTED SUPPLY 0F ELECTRICITY
IN THE FRANCHISE AREA
BeenactedbytheSenateandHouseofRepresentativesoftheRepublicofthePhilippinesinCongress
assembled:
1                      SECTloN 1, Nature and scope of Franchise. -Subject to the provisions of the constitution
2        and  applicable  laws,  rules  and  regulations,  there  is  hereby  granted  to  the  Camarines  Norte  Electric
3        Cooperatve,  Inc.  (CANORECO),  hereunder referred to  as the  Grantee,  its  successors or  assigns  a
4       franchise to construct,  install,  establish, operate, own, manage and maintain in the public interest and
5        commercial purposes, a distribution system for the conveyance of electric power to the end-users in the
6        municipalities  of  Daet  Mercedes,  Talisay,  Basud,  San  Vicente,  San  Lorenzo  Ruiz,  Vlnzons,  Labo,
7       Capalonga, Sta. Elena, Jose panganiban and paracale in the province ofcamarines Norte.
8                      As used in this Act,  disthbution system refers to the system of wires and associated facilities
9        including  sub-transmission  lines owned  by the franchised  disthbution extending  between the  delivery
lo        points on the national transmission, sub-transmission system or generatng facility connection  and the
11        metering pointlfacility of the end-users.
SECTloN 2. Manner of Operations of Facilities. -AIl electric distribution facilities, lines and
systems  for  electric  service  installed,  owned,  operated,  managed  or  maintained  by the  Grantee,  its
successors or assigns shall be operated or maintained at all times in a superior manner, and it shall be
thedutyoftheGrantee,itssuccessorsorassigns,wheneverrequiredtodosobytheEnergyRegulatory
Commission  (ERC),  or its  legal  successor,  or ano other government agency to  modify,  improve  and
change  such facilities  or systems in  such  manner and to such  extent as the  progress in  science or


18       technology and improvements or innovatons in the electric power services may render reasonable and
19        proper,
2o                       Whenever practicable,  and for purposes of maintaining order,  safety and aesthetics along the
21        highways roads, streets, alleys or right-of-way, the Grantee may allow the use offree spaces in its poles,
22       facilities, or right-of-way by interested parties upon reasonable compensation to the Grantee considering
23       the costs incumed to accommodate and administer the use of Grantee's facilities by such parties. The
24        ERC shall decide in case of dispute or disagreement between the parties.
25                      SECTloN 3. Authority of the ERc and the National Electrification Administration (NEA). -
26       The  Grantee shall  secure from the ERC,  NEA or any government agency having the jurisdiction over
27       their operations,  the  certificate of public  convenience  and  necessity  and  any other license,  permit or
28        authority indispensable for the construction and operation of the electhc power distribution system.
29                       SECTION 4. Ingress and Egress. -For the purpose of erecting and maintaining the poles or
3o       other supports for said facilities, wires or other conductors, transformer units and other parts and pondon
31        of an  assembly or for the  purpose  Of installing  and  maintaining  said  facilities,  wires,  cables  or other
32        conductors,  transformer  units  and  other  parts  and  pondon  of an  assembly,  it shall  be  lawful  for  the
33        Grantee, its successors,  or assignees, with the prior approval of the Department of public works and
34        Highways (DPWH) or the local government unit concerned, as may be appropriate, to make excavations
35        or lay conduits in any of the public places,  highways, roads, streets, lanes, alleys, avenues, sidewalks,
36        or bridges of the province, cities or municipalities: Provided, however, That a public place, highway, road,
37        street, lane, alley, avenue, sidewalk, or bridge disturbed, or altered, or changed by reason of erection of
38        poles orother supports orthe underground laying of wires, other conductors orconduits, shall be repaired
39        and replaced in workmanlike manner by the Grantee, its successors or assignees, in accordance with
4o       the  standard  set  by  the  DPWH  or  the  local  government  unit  concerned.  Should  the  Grantee,  its
41       successors or assignees, after the ten (10) -day nctce from the grant of authority, fail, refuse or neglect
42        to repair or replace any part of public place, highway, road, street, lane, alley, avenue, sidewalk, or bridge
43        altered, changed, or disturbed by the said Grantee, its successors or assignees, then the DPWH or the
44       local government unit concerned shall  have the right to have the same repaired and replaced in good
45       order and condition and charge the Grantee, its successors or assignees, at double the amount of the
46       costs and expenses for such repairor replacement.
47                       SECTloN 5. Responsibility to the public. -The Grantee shall supply electricity to its captive
48       market in the least costly manner. In the interest of the public good and as far as feasible and whenever
49        required by the ERC, the Grantee shall modify, improve or change its facilities, poles, lines, systems, and
5o        equipment for the purpose of providing efficient and reliable service and reduced electricity costs. The
51        Grantee shall charge reasonable and just power rates for its services to all types of consumers within its
52       franchisedareas.
53                       The  Grantee  shall  have  the  obligation  to  provide  open  and  nondiscriminatory  access  to  its
54        distribution system and services to any end-user within its franchise area consistent with Republic Act
55        No. 9136, otherwise known as the "Electric power Industry Reform Act of 2001'. The Grantee shall not
56        engage  in  ally  activity that will  constitute  an  abuse  of market power such  as  unfair trade  practices,
57        monopolistic schemes, and any other activities that will hinder competitiveness of business and industry.


58                      SECTION 6. Rates for services. -The retail rates and charges for the distribution of electric
59       power bythe Grantee to its end-users shall be regulated by and subjectto the approval of the ERC or its
6o        legalsuccessor.
61                       The Grantee shall identify and segregate in its electricity bill to the end-users the components of
62       the retail rate pursuantto Republic Act No. 9136, unless otherwise amended. Such rates charged by the
63        Grantee to the end-users shall be made public and tr.ansparent. The Grantee shall implement lifeline rate
64       to marginalized end-users as mandated under Republic Act No. 9136.
65                      SECTION  7. Protection  of  Consumer  Interests.  -The  herein  Grantee  shall  establish  a
66       consumer desk that will handle consumer complaints and ensure adequate protection and promotion of
67        consumer interests. The Grantee shall act with dispatch on all complaints brought before it.
68                    SEclloN   8.Commithent  to   Provide   and   Promote   the   Creation   of   Employment
69       0pportuni6es. -The Grantee shall create employment opportunities and shall allow on-theiob trainings
7o        in their franchise operation: Provided, That priority shall be accorded to the residents where their principal
71        office  is located: Provided,  further, That the  grantee shall follow the  applicable  labor standards  under
72        existing labor laws, rules and regulations, and similar issuances: Provided, finally. That the employment
73        opportunities or jobs  created  shall  be  posted  in  conspicuous  areas within  the  Grantee's  offices  and
74        service centers, copy furnished the provincial Department of Labor and Employment (DOLE).
75                      SECTloN 9. Right of the Goveimment. -A special right is hereby reserved to the president of
76        the philippines,  in times of war,  rebellion,  public peril, calamity, emergency,  disaster or disturbance of
77       peace  and  order  to  temporarily  take  over  and  operate  the  disthbution  system  of the  Grantee;  to
78       temporarily suspend the operation of any staton or facility in the interest of public safety, security and
79       public welfare; or to authorize the temporary use and operaton thereof by any agency of the government,
8o        upon due compensation to the Grantee, for the use of said distribution system during the period when
81       theseshall beso operated.
82                       SECTloN 10. Right of Eminent Domain. -Subject to the limitatons and prcoedures prescribed
83        by law, the Grautee is authorized to exercise the right of eminent domain insofar as it may be reasonably
84        necessary for the efficient maintenance and operation of services. The Grantee is authorized to install
85        and  maintain  its  poles,  wires,  and  other facilities  over  and  across public  property,  including  streets,
86        highways, forest reserves, and other similar property of the Government of the philippines, its branches,
87        or any of its instrumentalities. The Grantee may acquire such private property as is actually necessary
88       forthe realization of the purposes for which this franchise is granted: Provided, That proper expropriation
89        proceedings shall have been instituted and just compensation paid.
9o                      SECTION 11. Ten of Franchise. -This franchise shall be for a term of twenty-five (25) years
91       from the  date Of effectivity of this Act,  unless sooner cancelled.  This franchise  shall  be deemed ipso
92       facto revoked in the event that the Grantee fails to operate continuously for two (2) years.
93                      SECTloN 12. Acceptance of the Franchise. -Acceptance of the terms of this franchise shall
94        be  in  writing  to  the  Committee  on  Legislative  Franchises  of the  House  of  Representatives  and  the
95        Committee on public services of the philippine senate, within sixty (60) days from the effectivity of this


96       Act. Upon giving such acceptance, the Grantee shall exercise the privileges granted underthis Act. Non-
97       acceptance shall renderthe franehise void.
98                     SECTloN 13. Warranty in Favor of the National and Local Governments. -The Grantee
99        shall hold the national, provincial, city, and municipal governments of the philippines free from all claims,
loo        liabilities,  demands,  or  actions  arising  from  accidents  that  caused  injury  to  persons  or  damage  to
ioi        properties, during the construction, installation, operaton, and maintenance of the distribution system of
io2       theGrantee.
1o3                       SECTION 14. Liabilfty to Damages. -The Grantee shall be liable for any injury to persons and
io4       damage to property arising from or caused by accident,  by reason of any defective construction under
lo5       this franchise orof any neglect oromission to keep its poles and wires in safe condition.
1o6                     SECTION 15. Sale, Lease, Transfer, Grant of usufruct, or Assignment of Franchise. -The
1o7        Grantee shall  not sell,  lease, transfer,  grant the usufruct of,  nor assign this franchise or the rights and
io8       privileges acquired thereunder to any person, firm, company, corporation, or other commercial or legal
log       entity, or merge with anyother corporaton, orentity, orshall transferthe confrolling interestofthe grantee
llo        simultaneously or contemporaneously, to any such person, firm, company, corporation or entity without
111       the prior approval of the congress of the philippines.  Provided, That congress shall be infomed of any
112        sale, lease, transfer, granting of usufruct, or assignment offranchise or the rights and privileges acquired
113        thereunder, or of the merger or transfer of the controlling interest of the Grantee, within sixty (60) days
114       after the completion of the said transadion: Provided further, That any such transfer, sale or assignment
115        is  in  accordance  with  the  constitutional  limitatons:  Provided  furthermore,  That  failure  to  report  to
116        Congress such change of ownership shall render the franchise ipso facto revoked: Provided finally, That
117        any person or entity to which tliis franchise is sold, transferred or assigned, shall be subject to the same
118        conditions, terms, restrictions and limitations of this Act.
iig                      SECTloN 16. Reportoria] Requirement. -The Grantee shall submit an annual report to the
12o        Congress  of  the  Philippines,  through  the  Committee  on  Legislative  Franchises  of  the  House  of
121        Representatives and the committee of public services of the philippine senate, on its compliance with
122        the terms and conditions of the franchise and on its operations on oi. before April 30 of the succeeding
123        year during the term of the franchise. The reportorial compliance certificate issued by congress shall be
124        required before any application for permit or certificate is accepted by the ERC.
125                      SECTION 17. Equality clause. -Except for taxes and customs duties, any advantage, favor,
126        privilege, exemption, or immunity granted under existing franchises, or may hereinafter be granted shall,
127        upon  prior  review  and  approval  of Congress,  become  part of  previously  granted  power  distribution
128       franchises   and   shall   be   accorded   immediately   and   unconditionally   to   the   grantees   of   such
129        franchises: Provided, however, That the foregoing shall neither apply to nor affect provisions concerning
i3o       territory covered,  term,  or the type of service  authorized  by the franchise: Provided,  further, That the
131       foregoing  shall  not apply to  the  sale,  lease,  transfer,  grant of  usufruct,  or  assignment  of  legislative
132        franchise with prior congressional approval.


133                      SECTloN 18. Applicability of Existing Laws. -The Grantee shall comply with and be subject
134       to the provisions of commonwealth Act No.148 orthe "Public service Act., as amended: Republic Act
135        No. 9136; and Republic Act No.10531 orthe.National Electrificaton Administraton Reform Act of 2018".
136                       SECTION  19, Fine. -Any Grantee who fails to submit the annual report to congress shall  be
137        penali7.ed by a fine of Five hundred pesos (P500.00) per working day of noncomplianee. The fine shall
138        be collected separately by the ERc distinct from the penalties it imposes for noncompliance of its own
139        reportorial requirements. It shall be remitted to the Bureau of Treasury.
i4o                      SECTloN 20. Repealability and Non-Exclusivity clause. ~ This franchise shall be subject to
141        amendment, alteration, or repeal by the congress of the philippines when the public interest so requires
142        and shall not be interpreted as an exclusive grant of the privileges herein provided for.
143                       SECTION 21. Existing powers. ~ Existing mandates, powers, functions, and privileges granted
144       to electric ccoperatves under existing laws, including sedion 10 of RA No.10531, otherwise known as
145        the "National Electrification Administration Reform Act of 2013", shall remain valid and effective,  unless
146       expressly repealed by succeeding laws.
147                       SECTloN 22. Separabilfty clause. -lf any of the sections or provisions of this Act is held invalid,
148        all other provisions not affected thereby shall remain valid.
149                      SECTloN 23. Repealing clause. -All laws,  presidential decrees, executive orders,  letters of
i5o        instruction, administrative rules and regulations or parts thereof which are contrary to or inconsistent with
151        the provisions of this Act are hereby repealed or modified accordingly.
152                       SECTION  24. Effectivify.  -This Act shall  take  effect fifteen  (15)  days  after its  publicaton  in
153       the official Gazette or in a newspaper of general circulation.