Republic of the Philippines 
House of Representatives 
Quezon City 
TWENTIETH CONGRESS 
First Regular Session 
         House Bill No.  873 
Introduced by  
APEC Party-List Representative Sergio C. Dagooc 
EXPLANATORY NOTE 
The Negros Oriental I Electric Cooperative (NORECO I) was organized 
and registered with the National Electrification Administration in 1972 with a 
mandate to perform electrification in the Province of Negros Oriental on an 
area coverage basis. Notably, NORECO I has attained 100% electrification of 
the 3 cities, 8 municipalities, 285 barangays, and 83,378 household 
connections within its coverage area and it has been consistently categorized 
as an “AAA” cooperative, the highest categorization of an electric cooperative 
by NEA.  
Pursuant to 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 distribution of electricity shall be vested exclusively 
in the Congress of the Philippines.  
Thus, this bill seeks to grant a congressional franchise to NORECO I to 
provide an electric power distribution system to the people of the the Cities of 
Bais, Guihulngan and Canlaon and the Municipalities of Mabinay, Manjuyod, 
Bindoy, Ayungon, Tayasan, Jimalalud, La Libertad and Vallehermoso, 
Province of Negros Oriental. The bill also establishes standards that the 
franchise grantee must attain to implement an effective partnership between 
the State and the distribution utility as its implementing partner to achieve 
total electrification. 
The enactment of this bill will ensure the continuous delivery of electric 
July 1, 2025
2:30 pm


service from NORECO I to its coverage area and will contribute significantly 
to the economic development of the Province of Negros Oriental. 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 supply of electric power.  
In view of the foregoing, the approval of this bill is earnestly sought. 
REP. SERGIO C. DAGOOC 
APEC Party-List 


Republic of the Philippines 
House of Representatives 
Quezon City 
TWENTIETH CONGRESS 
First Regular Session 
         House Bill No.  873 
Introduced by  
APEC Party-List Representative Sergio C. Dagooc 
AN ACT 
GRANTING A FRANCHISE TO THE NEGROS ORIENTAL I ELECTRIC 
COOPERATIVE INC. (NORECO I) TO CONSTRUCT, INSTALL, ESTABLISH, 
OPERATE, OWN, MANAGE AND MAINTAIN DISTRIBUTION SYSTEMS FOR 
THE CONVEYANCE OF ELECTRIC POWER TO THE END-USERS IN THE 
CITIES OF BAIS, CANLAON AND GUIHULNGAN AND MUNICIPALITIES OF 
MABINAY, MANJUYOD, BINDOY, AYUNGON, TAYASAN, JIMALALUD, LA 
LIBERTAD AND VALLEHERMOSO, PROVINCE OF NEGROS ORIENTAL 
Be it enacted by the Senate and the House of Representatives of the Republic 
of the Philippines in Congress assembled: 
SECTION 1. Nature and Scope of Franchise. – Subject to the
1 
provisions of the Constitution and applicable laws, rules and regulations, 
2 
there is hereby granted to the Negros Oriental I Electric Cooperative, Inc. 
3 
(NORECO I) , hereunder referred to as the Grantee, its successors or assigns 
4 
a franchise to construct, install, establish, operate, own, manage and 
5 
maintain in the public interest and commercial purposes, a distribution 
6 
system for the conveyance of electric power to the end-users in the Cities of 
7 
Bais, Guihulngan and Canlaon and the Municipalities of Mabinay, Manjuyod, 
8 
Bindoy, Ayungon, Tayasan, Jimalalud, La Libertad and Vallehermoso, 
9 
Province of Negros Oriental. 
10 
As used in this Act, distribution system refers to the system of wires and 
11 
associated facilities including sub-transmission lines belonging to a 
12 
franchised distribution utility extending between the delivery point on the 
13 
national transmission system or generating facility and the metering 
14 


 
 
point/facility of the end-users. 
1 
SEC. 2. Manner of Operations of Facilities. – All electric distribution 
2 
facilities, lines and systems for electric services installed, owned, operated, 
3 
managed or maintained by the Grantee, its successors or assigns shall be 
4 
operated or maintained at all times in a superior manner, and it shall be the 
5 
duty of the Grantee, its successors or assigns, whenever required to do so by 
6 
the Energy Regulatory Commission (ERC), or its legal successor, or the 
7 
Department of Energy, or its legal successor, or any other governmental 
8 
agency concerned, to modify, improve and change such facilities or systems 
9 
in such manner and to such extent as the progress in science or technology 
10 
and improvements or innovations in the electric power services may render 
11 
reasonable and proper.  
12 
Whenever practicable, and for purposes of maintaining order, safety 
13 
and aesthetics along the highways, roads, streets, alleys, or right-of-way, the 
14 
Grantee may allow the use of free spaces in its poles, facilities, or right-of-way 
15 
by interested parties upon reasonable compensation to the Grantee 
16 
considering the costs incurred to accommodate and administer the use of the 
17 
Grantee’s facilities by such parties. The ERC shall decide in case of dispute 
18 
or disagreement between parties. 
19 
SEC. 3. Authority of the ERC. – The Grantee shall secure from the 
20 
ERC or any government agency having jurisdiction over their operations, the 
21 
certificate of public convenience and necessity and any other license, permit 
22 
or authority indispensable for the construction and operation of its electric 
23 
power distribution system. 
24 
SEC. 4. Ingress and Egress. – For the purpose of erecting and 
25 
maintaining the poles and other supports for said facilities, wires or other 
26 
conductors or for the purpose of laying and maintaining of said facilities, 
27 
wires, cables or other conductors, it shall be lawful for the Grantee, its 
28 
successors or assignees, in coordination with the Department of Public Works 
29 
and Highways (DPWH) or the local government unit concerned as may be 
30 
appropriate, to make excavations or lay conduits in any of the public places, 
31 
highways, roads, streets, lanes, alleys, avenues, sidewalks, or bridges of the 
32 
province, cities or municipalities: Provided, however, That a public place, 
33 
highway, road, street, lane, alley, avenue, sidewalk, or bridge disturbed, 
34 
altered, or changed by reason of erection of poles or other supports or the 
35 
underground laying of wires, other conductors or conduits, shall be repaired 
36 
or replaced in workmanlike manner by the Grantee, its successors or 
37 
assignees, in accordance with the standards set by the DPWH or the local 
38 
government unit concerned. Should the Grantee, its successors or assignees, 
39 
after the ten-(10) day notice from the grant of authority, fail, refuse, or neglect 
40 
to repair or replace any part of public place, highway, road, street, lane, alley, 
41 


 
 
avenue, sidewalk, or bridge altered, changed, or disturbed by the said 
1 
Grantee, its successors or assignees, then the DPWH or the local government 
2 
unit concerned shall have the right to have the same repaired and replaced in 
3 
good order and condition and charge the Grantee, its successors or assignees, 
4 
double the amount of the cost and expenses for such repair or replacement. 
5 
SEC. 5. Responsibility to the Public. – The Grantee shall supply 
6 
electricity to its captive market in the least costly manner. In the interest of 
7 
the public good and as far as feasible and whenever required by the ERC, the 
8 
Grantee shall modify, improve, or change its facilities, poles, lines, systems, 
9 
and equipment for the purpose of providing efficient and reliable service and 
10 
reduced electricity costs. The Grantee shall charge reasonable and just power 
11 
rates for its services to all types of consumers within its franchised areas in 
12 
order that business and industries shall be able to compete. 
13 
The Grantee shall have the obligation to provide open and 
14 
nondiscriminatory access to its distribution system and services for any end-
15 
user within its franchise area consistent with Republic Act (RA) No. 9136, 
16 
otherwise known as the “Electric Power Industry Reform Act of 2001”. The 
17 
Grantee shall not engage in any activity that will constitute an abuse of 
18 
market power such as unfair trade practices, monopolistic schemes, and 
19 
other activities that will hinder competitiveness of business and industries. 
20 
SEC. 6. Rates for Services. – The retail rates and charges for the 
21 
distribution of electric power by the Grantee to its end-users shall be 
22 
regulated by and subject to the approval of the ERC or its legal successor. 
23 
The Grantee shall identify and segregate in its electricity bill to the end-
24 
users the components of its retail rate pursuant to RA No. 9136, unless 
25 
otherwise amended. Such rates charged by the Grantee to the end-users shall 
26 
be made public and transparent. The Grantee shall implement lifeline rate to 
27 
marginalized end-users as mandated under RA No. 9136. 
28 
SEC. 7. Promotion of Consumer Interests. – The herein Grantee shall 
29 
establish a consumer desk that will handle consumer complaints and ensure 
30 
adequate promotion of consumer interests. The Grantee shall act with 
31 
dispatch on all complaints brought before it. 
32 
SEC. 8. Commitment to Provide and Promote the Creation of 
33 
Employment Opportunities. – The Grantee shall create employment 
34 
opportunities and shall allow on-the-job training in its franchise operation: 
35 
Provided, That priority shall be accorded to the residents where their principal 
36 
office is located: Provided, further, That the Grantee shall comply with the 
37 
applicable labor standards and allowance entitlement under existing labor 
38 
laws, rules and regulations, and similar issuances. 
39 


 
 
SEC. 9. Right of the Government. – A special right is hereby reserved 
1 
to the President of the Philippines, in times of war, rebellion, public peril, 
2 
calamity, emergency, disaster or disturbance of peace and order: to 
3 
temporarily take over and operate the stations or facilities of the Grantee; to 
4 
temporarily suspend the operation of any station or facility in the interest of 
5 
public safety, security and public welfare; or to authorize the temporary use 
6 
and operation thereof by any agency of the government, upon due 
7 
compensation to the Grantee, for the use of the stations or facilities during 
8 
the period when these shall be so operated. 
9 
SEC. 10. Right of Eminent Domain. – Subject to the limitations and 
10 
procedures prescribed by law, the Grantee is authorized to exercise the right 
11 
of eminent domain insofar as it may be reasonably necessary for the efficient 
12 
maintenance and operation of services. The Grantee is authorized to install 
13 
and maintain its poles, wires, and other facilities over and across public 
14 
property, including streets, highways, forest reserves, and other similar 
15 
property of the Government of the Philippines, its branches, or any of its 
16 
instrumentalities. The Grantee may acquire such private property as is 
17 
actually necessary for the realization of the purposes for which this franchise 
18 
is granted: Provided, That proper expropriation proceedings shall have been 
19 
instituted and just compensation paid. 
20 
SEC. 11. Term of Franchise. – Unless sooner cancelled, the franchise 
21 
shall be in effect for a period of twenty-five (25) years from the effectivity of 
22 
this Act. This franchise shall be deemed ipso facto revoked in the event the 
23 
Grantee fails to operate continuously for two (2) years. 
24 
SEC. 12. Warranty in Favor of the National and Local 
25 
Governments. – The Grantee shall hold the national, provincial, city, and 
26 
municipal governments of the Philippines free from all claims, accounts, 
27 
demands, or actions arising from accidents causing injury to persons or 
28 
damage to properties, during the construction, installation, operation, and 
29 
maintenance of the distribution system of the Grantee. 
30 
SEC. 13. Liability for Damages. – The Grantee shall be liable for any 
31 
injury to persons and damage to properties arising from accidents by reason 
32 
of any defective construction under this franchise or of any neglect or 
33 
omission to keep its poles and wires in safe condition. 
34 
SEC. 14. Sale, Lease, Transfer, Usufruct, or Assignment of 
35 
Franchise. – The Grantee shall not sell, lease, transfer, grant the usufruct of, 
36 
or assign this franchise or the rights and privileges acquired thereunder to 
37 
any person, firm, company, corporation, or other commercial or legal entity, 
38 
or merge with any other corporation, or entity, or shall transfer the controlling 
39 
interest of the Grantee, whether as a whole or in parts, and whether 
40 


 
 
simultaneously or contemporaneously, to any such person, firm, company, 
1 
corporation, or entity without the prior approval of the Congress: Provided, 
2 
That Congress shall be informed of any lease, transfer, granting the usufruct 
3 
of, sale, or assignment of franchise or the rights and privileges acquired 
4 
thereunder, or of the merger, or sale of the controlling interest within sixty 
5 
(60) days after the completion of said transaction: Provided further, That any 
6 
such transfer, sale, or assignment is in accordance with the constitutional 
7 
limitations: Provided furthermore, That failure to report to Congress such 
8 
change of ownership shall render the franchise ipso facto revoked: Provided 
9 
finally, That any person or entity to which this franchise is sold, transferred, 
10 
or assigned, shall be subject to the same, conditions, terms, restrictions, and 
11 
limitations of this Act. 
12 
SEC. 15. Reportorial Requirement. – The Grantee shall submit an 
13 
annual report to Congress, through the Committee on Legislative Franchises 
14 
of the House of Representatives and the Committee on Public Services of the 
15 
Senate, on its compliance with the terms and conditions of the franchise and 
16 
on its operations on or before April 30 of every year during the term of the 
17 
franchise. The reportorial compliance certificate issued by Congress shall be 
18 
required before any application for permit or certificate is accepted by the 
19 
ERC. 
20 
SEC. 16. Fine. – The failure of the Grantee to submit the requisite 
21 
annual report to Congress shall be penalized with a fine in the amount of Five 
22 
hundred pesos (P500.00) per working day of noncompliance which shall be 
23 
collected by the ERC. The fine shall be collected separately from the 
24 
reportorial penalties imposed by the ERC and shall be remitted to the Bureau 
25 
of the Treasury. 
26 
SEC. 17. Equality Clause. – Any advantage, favor, privilege, 
27 
exemption, or immunity granted under existing franchises, or which may 
28 
hereafter be granted, upon prior review and approval of Congress, shall 
29 
become part of this franchise and shall be accorded immediately and 
30 
unconditionally to the herein Grantee: Provided, however, That the foregoing 
31 
shall neither apply to nor affect provisions concerning territory covered by the 
32 
franchise, the life span of the franchise or the type of service authorized by 
33 
the franchise: Provided, further, That the foregoing shall not apply to the sale, 
34 
lease, transfer, grant of usufruct, or assignment of legislative franchises with 
35 
prior congressional approval. 
36 
SEC. 18. Applicability of Existing Laws. – The Grantee shall comply 
37 
with and be subject to the provisions of Commonwealth Act No. 146 or the 
38 
“Public Service Act”, as amended, RA 9136, and RA 10531 or the “National 
39 
Electrification Administration Reform Act of 2013.” 
40 


 
 
SEC. 19. Existing Powers. – Existing mandates, powers, functions, 
1 
and privileges granted to electric cooperatives under existing laws, including 
2 
Section 10 of RA 10531 shall remain valid and effective, unless expressly 
3 
repealed by succeeding laws. 
4 
SEC. 20. Repealability and Non-Exclusivity Clause. – This franchise 
5 
shall be subject to amendment, alteration, or repeal by Congress when the 
6 
public interest so requires and shall not be interpreted as an exclusive grant 
7 
of the privileges herein provided for. 
8 
SEC. 21. Separability Clause. – If any of the sections or provisions of 
9 
this Act is held invalid, all other provisions not affected thereby shall remain 
10 
valid. 
11 
SEC. 22. Repealing Clause. – All laws, presidential decrees, executive 
12 
orders, letters of instruction, administrative rules and regulations or parts 
13 
thereof which are contrary to or inconsistent with the provisions of this Act 
14 
are hereby repealed or modified accordingly. 
15 
SEC. 23. Effectivity Clause. – This Act shall take effect fifteen (15) 
16 
days after its publication in the Official Gazette or in a newspaper of general 
17 
circulation. 
18 
Approved, 
19