Republic of the Philippines
aBouse ot 3Reyr¢SetttattbeS
Diliman, Quezon City
NINETEENTH CONGRESS
Second Regular session   .,
HouseBi||No.10480
Introduced by
RepreseTitative A:in:ulgf Bryan 8. Fueiitebella
Representative Gabriel H. Bordado Jr.
PHILRECA Party-List Representative Presley C. De Jesus
APEC Pc[rty-List Representatwe Sergio C. Dag ooc
EXPI.ANATORY NOTH
Under Section 27 of Republic Act No. 9136, otherwise known as the Electric Power
Industry Reform Act (EPIRA), the power to grant franchises to persons engaged in
the  transmission  and  distribution  of electricity  shall  be vested  exclusively  in  the
Congress  of the  Philippines.    Corollary,  this  bill  seeks  to  grant  a  congressional
franchise to Camarines Sur 11 Electric Cooperative (CASURECO 11) in order for it  to
continuously provide electric power distribution eystem to the  people of the City of
Naga  ,Camarines  Sur,  and  the  Municipalities  of  Bonbon,  Calabanga,  Canaman,
Magarao, Milaor, Minalabac, Pili,  Siruma and Tinambac, Camarines Sur.
CASURECO 11 was organized and registered pursuant to the provisions of Presidential
Decree No. 269, as amended, and under the supervisory authority of the National
Electrification Administration (NEA) with a mandate to perform electrification in the
City  of  Naga  ,  Camarines  Sur,  and  the  Municipalities  of    Bonbon,  Calabanga,
Canaman,   Magarao, Milaor, Minalabac, Pili,   Siruma and   Tinambac , Camarines
Sur.   Ever since, CASURECO 11 has provided quality services to the aforestated city
and municipalities, and performed exceptionally to fulfill its mandate.  In fact, the
exceptional performance of CASURECO 11 is shown by the results produced since it
has been granted a franchise to distribute electric  power to  the aforesaid city and
municipalities of Camarines Sur.   CASURECO 11   has energized ninety-nine and
Sixty one Percent (99.61%) of the barangays within its franchise area. Further,


I
since 2ol7,  CASURECO 11 has been consistently categorized for six  (6) years as an
"AAA"  cooperative,  the    highest  categorization  of an  electric  cooperative  by  the
supervising goverrment ageney - the NEA.
The  enactment of this bill will ensure the continuous  delivery of electricity from
CASURECO  11 to the  mentioned city and  municipalities  and will create the  path
towards progress in Camarines Sur. Likewise, it will be in line with the policy of the
State as provided for in EPIRA, to ensure and accelerate the total electrification of
the country; and to ensure the quality, reliability, security, and affordability of the
supplyofelectricpower.
In view of the foregoing, the approval of this bill is eamestly sought.
•ILRECA Party -list Represen:Iative
REP. SERC
APEC Party-I
AcOOC
resentative


Republic of the Philippines
aBouSe of 3Reyresetttatfb¢S
Diliinah, Qinezon City
NINETEEr`ITII coNGREss
Second Regular Session
HouseBil|oNo.   10480
Introdticed try
Rapresenlative A:rn:ugf Bryan 8. Fuenlebetta
Represeritative Gabriel H. Bordado , Jr .
PHILRECA Party-List RepreseTitc[rfue Ptesley C. De Jesus
APEC Party-List Representative Sergio C. Dagooc
JEN ACT
GRANTING   A      FRANCHISE   OF   CAMARINES   SUR   11   EI.ECTRIC
COOPERATIVE,   INC.   (CASURECO   11)   TO   CONSTRUCT,   INSTAIL,
ESTABLISH,       OPERATE,      OWN,      MANAGE      AND      MAINTAIN
DISTRIBUTION   SYSTEMS   FOR  THE   CONVEYANCE   0F   EIHCTRIC
poi^7ER TO THE END usERs IN THE clTy OF NAGA, cAMARINlrs SUR ,
AND          MUNICIPALIHES          O F          BOMBON ,          CAIABANGA,
CANAMAN,MAGARAO,     MIIAOR,MINAIABAC,PILI,     SIRUMA    AND
TINAMBAC.
Be it  enacted bg  the  Senate  and House Of RapTeseTitatives  Of the  Phttippines in
Congress assembled :
1                SECTION 1. Nature and scope oJ.Franchise. -Subject to the provisions
2      of the  Constitution  and  applicable  laws,  rules  and  regulations,  there  is  hereby
3     granted to the CASURECO II ELECIRIC COOPERATIVE, INC. (CASURECO
4      11), hereunder referred to as the grantee, its successors or assigns a franchise to
5      construct, install, establish, operate, own, manage and maintain in the public interest
6      and commercial purposes,  a distribution system for the conveyance of electric power
7      to   end   users   in   the   City   of   Naga,   Camarines   Sur,   and   Municipalities   of
8     Bonbon,Calabanga,Canaman,Magarao,Milaor,Minalabac,Hli,     Siruma
9    and "nambac,Camarines sur.
10


1                 As used in this Act,  distribution system refers to the eystem of wires  and
2      associated  facilities  including  sub-transmission  lines  belonging  to  a  franchised
3      distribution utility extending between the delivery point on the national trausmission
4      system or generating facility and the metering point/facility of the end-users."
5                SECTION   2.     Manner   off  Operation  oof  Facilities.   -  AIl  ctectric
6      distribution  facilities,  lines,  and  systems  for  electric  services  installed,  owned,
7      operated, managed or maintained by the grantee, its successors or assigns shall be
8      operated or maintained at all times in a superior manner, and it shall be the duty of
9      the grantee,  its successors  or assigns, whenever required to do  so by the  Energy
10      Regulatory commission, hereinafter referred to as the ERC, or its legal successor, or
11      the Department of Energy, hereinafter referred to as the DOE, or its legal successor,
12      or the National Hectrification Administration (NEA) or its legal successor, or any
13      other government agency concerned to modify, improve and change such facilities or
14      systems in such manner and to such extent as the progress in science or technology
15      and improvements or innovations in the electric power service industry may render
16      reasonable andproper.
17                 Whenever  practicable,  and  for  purposes  of maintaining  order,  safety  and
18      aesthetics along highways,  roads,  streets,  alleys,  or right-of-way, the grantee may
19      allow the use of free spaces in its poles, facilities, or right-of-way by interested parties
20      upon  reasonable  compensation to  the  grantee  considering  the  costs  incurred  to
21      accommodate and administer the use of the grantee's facilities by such parties. The
22      ERC shall decide in case of dispute or disagreement between the parties.
23                SECTIOIN 3. Authorirty   Of  the   Ene:rgu   Regulatory   Commission
24      (ERCJ. -The grantee shall secure from the ERC or any government ageney having
25     jurisdiction over their operations, the certificate of public convenience and necessity
26      and any other license, permit or authority indispensable for the construction and
27      operation of the electric power distribution system.
28                 SECTION4.  Ingress  and  Egress.  -For  the  purpose  of  erecting  and
29      maintaining the poles or other supports for said facilities, wires or other conductors
3o      for  the  purpose  of laying  and  maintaining  said  facilities,  wires,  cables,  or  other
31      conductors,  it  shall  be  lawful  for  the  grantee,  its  successors,  or  assignees,  in
32      coordination with the Department of Public Works and Highways (DPWH) or the
33      local government unit concerned, as may be appropriate, to make excavations or lay
34      conduits in any of the public places, highways, roads, streets, lanes, alleys, avenues,
35      sidewalks,  or bridges of said province and city:  Proui.ded,  however,  That a public
36      place,  highway,  road,  street,  lane,  alley,  avenue,  sidewalk,  or  bridge  disturbed,
37      altered,  or  changed  by  reason  of  erection  of  poles  or  other  supports  or  the
38      underground  laying  of wires,  other  conductors  or  conduits,  shall  be  repaired  or
39      replaced in workmanlike  manner at the expense of the grantee, its  successors or
4o      assignees,   in  accordance  with  the  standards   set  by  the   DPWH   or  the  local
41      government unit concerned. Should the grantee, its successors or assignees, after the
42      ten  (1o)-day  notice  from  the  grant  authority,  fail,  refuse  or  neglect  to  repair  or
43      replace any part ofpublic place, highway, road, street,lane, alley, avenue, sidewalk or
44      bridge altered, changed, or disturbed by the said grantee, its successors or assignees,
45      then the DPWH or the local government unit concerned shall have the right to have
46     the same repaired or replaced in good order and condition and charge the grantee, its


1      successors  or  assignees,  the  amount  of  cost  and  expenses  for  such  repair  or
2      replacement.
3                 SECTION  5.  Resportsjbl.Zi.ty  [o  the Pubzfc.  -  The  grantee  shall  supply
4     electricity to its captive market in the least costly manner.  In the  interest of the
5      public good and as far as feasible and whenever required by the ERC, the grantee
6      shall modify, improve or change its facilities, poles, lines, eystems, and equipment for
7      the purpose of providing efficient and reliable service and reduced electricity costs.
8      The grantee shall change reasonable andjust power rates for its services to all types
9     of consumers within its franchised areas in order that business and industries shall
10      beabletocompete.
11                 The grantee shall have the obligation to provide open and nondiscriminatory
12      access to its distribution system and services for any end-user within its franchise
13      area consistent with Republic Act No. 9136, otherwise known as the "Electric power
14      Industry Reform Act of 2ool". The grantee shall not engage in any activity that will
15      constitute an abuse of market power such as unfair trade practices,  monopolistic
16      schemes,  and  other  activities  that  will  hinder  competitiveness  of  business  and
17      industries.
18                 SEorloN  6. Rates Jar Sen}£ces.  -The  retail  rates  and charges  for the
19      distribution of electric power by the grantee to its end-users shall be regulated by and
2o      subject to the approval of the ERC or its legal successor.
21                  The grantee shall identify and segregate in its electricity bill to the end-users
22      the  components  of  the  retail  rate  pursuant  to  Republic  Act  No.  9136,  unless
23      otherwise  amended.  Such  rates  charged by the grantee to the end-users shall be
24      made   public   and  transparent.   The   grantee   shall   implement  lifeline   rate   to
25      marginalized end-users as mandated under Republic Act No. 9136.
26                SECTION 7. PI.oman.on of coi'isumer Jnte].ests.  -The herein grantee
27      shall establish a consumer desk that will handle consumer complaints and ensure
28      adequate promotion of consumer interests. The grantee shall act with dispatch on all
29      complaints brought before it.
3o                 SECTION 8.  Rt.gJ.I  a/ tJie  Gotje..I.merit.     -A  special  right  is  hereky
31      reserved to the president of the philippines, in times of war, rebellion, public peril,
32      calamity, emergeney, disaster or disturbance of peace and order: to temporarily take
33     over and operate the stations or facilities of the grantee; to temporarily suspend the
34      operation of any station or facility in the interest of public safety, security and public
35      welfare; or to authorize the temporary use and operation thereof by any ageney of the
36     government, upon due compensation to the grantee, for the use of the stations or
37      facilities during the period when these shall be so operated.
38                SEorloN 9. Rt.gJ.I oJ.Eminent Domdin. -Subject to the limitations and
39      procedures  prescribed by  law,  the  grantee  is  authorized to  exercise  the  right  of
4o     eminent  domain  iusofar  as  it  may  be   reasonably  necessary  for  the  efficient
41      maintenance  and operation  of services.  The  grantee  is  authorized to  install  and
42      maintain  its  poles,  wires,  and  other  facilities  over  and  across  public  property,
43      including  streets,  highways,  forest  reserves,  and  other  similar  property  of  the
44      Government of the  Philippines,  its  branches,  or any of its  instrumentalities. The


1      grantee may acquire such private property as is actually necessary for the realization
2      of  the  purposes  for  which  this  franchise   is  granted:   Prout.ded,   That  proper
3      expropriation proceedings shall have been instituted and just compensation paid.
4                 SECTION lo. rerrus oJ'Frflnchise.  -Unless sooner cancelled, the franchise
5      sha]] be in effect for a period of twenty-five (25) years from the effectivity  of this Act.
6     This franchise shall be deemed ibso/cicto revoked in the event that the grantee falls
7      to operate continuouslyfor two (2) years.
8                SECHON 11. Acceptance oJ.tJie Franchise. -Acceptance of the terms of
9     this franchise shall be in writing to the Congress  of the Philippines, through the
10      Committee  on  Legislative  Franchises  of  the  House  of  Representatives  and  the
11      Committee on public services of the senate within sixty (6o) days from the effectivity
12      of this Act. Upon such acceptance, the grantee shall exercise the privileges granted
13      under this Act. Non-acceptance shall render the franchise void.
14                SECTTOEN    T2.    Wct:rranty    in    Fcwor    Of   National    and    Ijocal
15      Gottel.nments. -The grantee shall hold the national, provincial, city, and municipal
16      governments of the Philippines free from all claims, accounts, demands, or actions
17      arising out of accidents or injuries, whether to property or to persons, caused by the
18     construction, installation, operation, and maintenance of the distribution eystem of
19      thegrantee.
SECTION 13. Lfab€Zfrty ro Damages.   - The grantee shall be liable for any
injury and damage arising from or caused by accident to persons and pl.operiy by
reason  of  any  defective  construction  under  this  franchise  or  of  any  neglect  or
omission to keep its poles and wires in safe condition.
SEcrFIOIN  14.  Sale,  Lease,  Tra:nofer,  Usu!fruct,  or  Assigri:meat  Of
FrancJiise.   - 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, or merge with any
other corporation,  or entity,  or shall 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 of the Philippines: A.out.did, That Congress shall be informed of any
lease, transfer, granting the usufruct of,  sale, or assignment of franchise or the rights
and privileges  acquired thereunder,  or  of the  merger,  or  sale  of the  controlling
interest within sixty (6o) days after the completion of the said transaction: ProtJi.ded
jitrther,   That  any  such  transfer,   sale,   or  assignment  is  in  accordance  with
constitutional limitations : Proui.did, jitrthermore, That failure to report to Congress
such change of ownership shall render the franchise 1.pso /acfo revoked: Protjt.did
J}na!Zgr,  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.
SECI'ION 16. Rqporforfuz Requiremeitt.   - The grantee shall submit an
armual  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  Senate,  on  its  compliance  with  the  terms  and  conditions  of the


1      franchise and on its operations on or before April 3o of every year during the term of
2      the  franchise.  The  reportorial  compliance  certificate  issued  by Congress  shall  be
3      required before any application for permit or certificate is accepted by the ERC.
4                 SEorloN 17. Ffrie. -The failure of the grantee to submit the requisite annual
5      report to congress shall be penalized by a fine in the amount of five hundred pesus
6      (P5oo.oo) per working day of noncompliance. The fine shall be collected by the ERC
7     from  the  delinquent  franchise  grantee  separate  from  the  reportorial  penalties
8     imposed by the ERC. All proceeds from the fines or penalties shall accrue to the
9      mohitoring fund of the ERc in line with its supervisory and regulatory functions.
1o                 SECITON   18.   EquaJt.tI/   C[ailse.   -   Any   advantage,   favor,   privilege,
11      exemption, or immunity granted under existing franchises, or which may hereafter
12     be granted, upon prior review and approval of Congress, shall become part of this
13      franchise  and  shall  be  accorded  immediately  and  unconditionally  to  the  herein
14      grantee:  Prouided,  /iouJeue7.,  That the  foregoing  shall  neither apply to  ncjr affect
15      provisions  concerning  territory  covered  by  the  franchise,  the  life  span  for  the
16      franchise or the type of service authorized by the franchise: I+out.did,JiJrther, That
17     the  foregoing  shall  not  apply  to  the  sale,  lease,  transfer,  grant  of  usufruct  of
18      assignment of legislative franchises with prior congressional approval.
ig                SECTION  ig. Armlieabiltti]  Of Existing  Lows.    -   The  grziutee  shal:i
2o      comply with and  be subject to  the provisions  of Commonwealth Act No.  146,  as
21      amended, otherwise or the "Public service Act" and Republic Act No. 9136, otherwise
22      known as the "Electric  power Industry Reform Act of2ool".
23                SECTICIN  2o.  Repealal.iltrty  and  Non-Exctusivirty  Clu:use.  -  This
24     franchise shall be subject to amendment, alteration, or repeal by the congress of the
25      Philippines when the public interest so requires and shall not be interpreted as an
26      exclusive grant of the privileges herein provided for.
27                 SECITON 21. Saparaziizi.tI/ erduse.  -If any of the sections or provisions of
28      this Act is held invalid, all other provisions not affected thereby shall remain valid.
29                 SECTION 22. Repealing clause. -All laws, presidential decrees, executive
3o     orders, letters of instruction, administrative rules and regulations or parts thereof
31      which  are  contrary to  or inconsistent with the  provisions  of this Act are  hereby
32      repealed or modified accordingly.
33                  SECTION  23. E]edsti.»g Pott>e7ts.  -Existing  mandates,  powers,  funedons,
34      and privileges granted to Electric cooperatives under existing laws, including secft.on
35      Io  o/ Repubzi.c Act No.  Io53I,  shall  remain valid  and  effective,  unless  expressly
36      repealedby succeedinglaws.
37                 SECTION 23. EJffectitJftu clause.  -This Act shall take effect fifteen (15)
38      days after its publication either in at least two (2) newspapers of general circulation.
3 9                  Approved ,