Meralco Franchise Extension Gains Strong Legislative-Consumer Support

The House Committee on Legislative Franchises has given its nod to a bill that seeks to extend the franchise of Manila Electric Co. (Meralco) for another 25 years.

Lawmakers and consumer groups rally behind the 25-year extension of Meralco's franchise, highlighting its crucial role in powering the Philippine economy. | Photo: HOR Facebook

This move, hailed by Albay 2nd District Rep. Joey Salceda as a key milestone in the country's industrial policy, is expected to "sail smoothly" through the House of Representatives, reflecting widespread political and business support for the country’s largest electricity distributor.

The committee's decision to endorse the consolidated bills renewing Meralco’s franchise underscores the importance of the utility’s role in powering the Philippine economy.

Committee Chairman and Paranaque Rep. Gustavo Tambunting emphasized that Meralco's franchise renewal has garnered extensive support from various business organizations and nearly two dozen industry federations.

This overwhelming backing, combined with the legislative efforts of key figures such as former House Speaker Rep. Lord Allan Jay Velasco and Rep. Rufus Rodriguez of Cagayan de Oro City, who have both filed similar bills, underscores the franchise’s critical importance to the nation’s economy.

Rep. Salceda, a prominent advocate for the franchise extension, expressed confidence in the bill's passage, citing Meralco’s compliance with its mandates under the current franchise law.

"Meralco is an exemplar of how service reliability can create economic growth and development," Salceda stated, noting that the franchise covers an area responsible for more than half of the country’s gross domestic product (GDP) and approximately 26 percent of the population.

Adding to the chorus of support, Laban Konsyumer Inc. (LKI), a consumer advocacy group, has publicly endorsed Meralco’s franchise renewal, highlighting the crucial role the utility plays in ensuring a stable and reliable electricity supply.

LKI praised Meralco's competitive selection process (CSP) for securing power supply contracts at the least cost, ensuring that consumers benefit from stable and affordable electricity.

The consumer group further noted that Meralco’s current electricity rates, at P11.60/kWh for typical residential customers, are highly competitive, especially when compared to other private distributors and electric cooperatives, some of which charge as high as P21/kWh.

LKI emphasized that the non-renewal of Meralco's franchise could have severe consequences for households, businesses, and the broader economy, potentially disrupting vital electricity services.

As the bill progresses through the legislative process, the strong alignment between lawmakers and consumer advocates suggests that Meralco’s franchise renewal is not only a matter of national economic interest but also crucial for safeguarding consumer welfare.

With the House of Representatives expected to deliberate on the bill soon, the franchise renewal appears poised to advance smoothly, ensuring that Meralco continues to power the nation’s growth for years to come.