Congressman wants Meralco franchise split into three

REP. Dan Fernandez has urged Congress to split the mega-franchise of Manila Electric Company (Meralco) into three, saying it has failed to serve the interest of 7.6 million subscribers and overcharging them in the last nine years.

In a privileged speech last Tuesday, Fernandez said Meralco has grown too big and dominant in the power industry, necessitating a review of its franchise.

“It’s high time we renewed its franchise to pave the way for the split of the mega-franchise we granted Meralco,” said Fernandez.

“If possible, we can split it into three franchises since Meralco actually operates in three sectors in Luzon— NCR (National Capital Region), South Luzon (Calabarzon) and North Luzon sector of Pampanga and Bulacan,” he added.

The Laguna lawmaker said Meralco controls at least 70 percent of Luzon’s electricity output and it is able to manipulate the operations of power producers and sellers.

“They control the whole of Metro Manila, NCR, they control the whole of Calabarzon, including my province, Laguna,” said Fernandez.

Because the franchise is too big, Fernandez said Meralco has in effect divided it up to be able to manage it.

“They also control Pampanga and Bulacan,” Fernandez said, adding: “They are so huge and enormous that they have subdivided the whole franchise. They have subdivided (it) into the central, southern, and northern sectors.”

He also cited reports that Metro Pacific Investment Corp., Meralco’s mother company, was acquiring the natural gas power plant in Ilijan town, Batangas province. The plant has a 2,500-megawatt capacity and uses combined-cycle natural gas to operate.

“If you combine the assets of Meralco and Ilijan Power Plant, they will be creating a vertical integration system wherein they will be controlling fuel supply, imported fuel facilities, power supply and distribution under one board of directors,” he said, calling this development a concern for the country’s national security.

Fernandez said Congress has the power to “amend, revoke, suspend, and even subdivide the firm’s franchise.”