San Miguel Energy Corporation or SMEC, a unit of Asian conglomerate San Miguel Corporation led by businessman Ramon S. Ang, failed to ”prove its right” for a temporary restraining order or TRO against an order issued by the Energy Regulatory Commission.
In a press statement on Thursday night, the ERC confirmed that the 16th Division of the Court of Appeals denied SMEC’s position for a TRO to suspend the implementation of the 29 September 2022 Order issued by the ERC.
Citing a Resolution dated 13 January, a copy of which was received by the Office of the Solicitor General or OSG on Thursday, the state-run power regulator said the CA “ruled that SMEC failed to prove its right to a restraining order.”
The ERC pointed out that the appellate court agreed that the ERC’s denial of SMEC’s Motion for Price Adjustment already preserves the status quo, which is the contract price in SMEC and Manila Electric Company’s Power Supply Agreement.
According to ERC, the appellate court also emphasized that, if granted, “the writ of injunction will give SMEC the unrestricted power to terminate, at its own will, the Power Supply Agreement to the detriment of public consumers.”
Per the CA, the ERC said a TRO should not be issued since there is a need for an extensive determination of the merits of SMEC’s case.
In response, SMC Global Power said Friday that it will “continue to pursue all available legal remedies in line with our fiduciary duties to our stakeholders, to preserve our ability to provide stable power supply for consumers and forge ahead with new and existing projects aimed at helping secure our country’s future power needs.”
The company said it remains confident that the government will side with it in “promoting an environment where both consumers and industries collaborate in delivering on our country’s energy goals and providing viable and shared solutions to address the ongoing power crisis.”
The case stemmed from the ERC’s denial of SMEC and Meralco’s motion for price adjustment in their contract.
SMEC filed a Petition for Certiorari against the ERC, where the subject TRO was also prayed for.
The 16th Division, on the other hand, granted SMEC’s motion that the subject case be consolidated with another case with similar facts filed by South Premiere Power Corporation pending before the 13th Division of the CA.
Last December 2022, the OSG represented the ERC in opposing the application of the SMEC for a TRO or Injunction filed before the 17th Division of the CA.
In its 34-page opposition, the OSG reiterated that the 17th Division of the CA has no jurisdiction to issue a TRO since only the Supreme Court can restrain the implementation of the Electric Power Industry Reform Act of 2001 or the EPIRA.
It likewise asserted that ERC merely exercised its consumer protection mandate and enforced the distribution utilities’ obligation to supply the electricity in the least cost manner.
SMEC has a 330-megawatt baseload Power Supply Agreement with Meralco executed following a Competitive Selection Process in 2019. The company’s petition to cease the agreement was due to its mounting losses amid skyrocketing fuel prices.