Stakeholders claim SPBC franchise ‘a sure-fire recipe for a monopoly’

The impending approval of a proposed measure granting Solar Para sa Bayan Corporation (SPBC) a 25-year franchise will pave the way for an industrial monopoly, the Coalition for Rural Electrification (CORE) said Thursday.

In December 2018, the House of Representatives approved House Bill 8179 on third and final reading, paving the way for Solar’s authority to build, install, establish, operate, and maintain distributable power technologies and mini-grid systems across the country. 

A similar measure is pending before the Senate.

Solar is owned and operated by Leandro Leviste, the son of Senator Loren Legarda.

“HB 8179 is a surefire recipe for setting up a monopoly at the expense of the consumer and host communities,” CORE said in a position paper.

During a press conference in Pasig City, CORE board member Erwin Cerafica said that a franchise for Solar is “unnecessary, unconstitutional, and anti-competitive.”

“Some of the statements or sections in the proposed bill are actually...very conflicting. For example, it tells us that you’re going to particularly take the position that they don’t need the competitive selection process,” he said.

“Basically, they’re saying that competitive selection does not apply to them. It will come out as if for a certain area, you would like to take that area as part of your franchise then other qualified third parties or other private developers who want to come in needs a Swiss challenge,” Cerafica added.

CORE is an alliance of renewable energy SMEs and cooperatives advocating accessible renewable energy, especially to rural areas.

Leviste earlier insisted that the company stands on its own merit, and emphasized that it will help address the gap between more than 20 million Filipinos and 24/7 access to electricity. 

CORE said that despite claims that the bill is non-exclusive, a franchise would discourage the participation of small and medium enterprises—renewable energy enterprises are highly capable but have insufficient financial resources.

There are other industry players that can provide the same service, but Leviste would always be a step ahead because of the franchise, said Claire Lee, a member of CORE. “He would have a competitive advantage by having the franchise,” she said.

In its position paper, CORE said that HB 8179 is unconstitutional and goes against the “equal protection clause,” which affords all players in an industry the same rights.

The group emphasized that the bill contradicts the Electric Power Industry Reform Act (EPIRA) since the franchise enables Solar to do business across the power industry’s whole value chain, which the law unbundled into the four sectors of generation, transmission, distribution, and supply.

“The grant of franchise to Solar skirts the prohibition against cross subsidies and cross ownership ... It encroaches into the franchise of TRANS/NGCP as well as other distribution utilities and electric cooperatives,” the group said.

GMA News Online has reached out to Leviste regarding the issues raised by CORE, but no response has been received as of this posting.

Due to issues of conflict of interest amid the push for a legislative franchise for Solar, Anti-Trapo Movement (ATM) has filed an ethics complaint against Senator Legarda before the Senate Committee on Ethics and the Presidential Anti-Corruption Commission.

"Prior to the Senate acting on the subject Leviste's franchise application, we respectfully submit that the Senate Committee on Ethics and Privileges must first come to a determination whether a franchise application that will directly benefit the son of a sitting senator... will be in the nature of violation of the constitutional prohibition under Section 14 of Article VI of the Philippine Constitution," ATM said in its Senate ethics complaint.

The Senate Ethics committee is chaired by Senator Manny Pacquiao.

Under the said provision, no senator or member of the House of Representatives shall intervene in any matter before any Office of the Government for his or her pecuniary benefit.

ATM said the prohibition also covers direct or indirect pecuniary benefit for relatives.

On Wednesday, PACC Commissioner Greco Belgica said that the complaint, which the agency received on January 4, is now undergoing evaluation.

“Under evaluation pa ‘yung case. It was received on January 4. It is the first step to verify the report and evidence kung totoo … ” Belgica said in a text message.

Asked if the PACC can investigate elected legislators according to its mandate, Belgica noted it is not possible.

“General rule hindi. Lifestyle check pwede. Pero pag may collusion ang case with them … puwede sila madamay.”

In its complaint, ATM urged the commission to conduct an inquiry into what it claimed was “apparent meddling” by Legarda, citing news reports quoting critics who alleged that the speedy passage of Solar’s franchise in the House was special treatment.

The House approved the franchise four months after the bill was filed in August 2018.

Section 14 of Article VI of the Constitution prohibits a senator or congressman from having financial interest, directly or indirectly, in any contract with, or in any franchise or special privilege granted by the government. A lawmaker should also not intervene in any matter before any government office for his pecuniary benefit or “where he may be called upon to act on account of his office.”

On criticisms that his mother’s status and political influence are paving the way for a congressional franchise, Leviste earlier said that he and the corporation “have taken it upon ourselves to doubly prove the merit of this application” as a result. —with a report by Virgil Lopez/VDS/BM, GMA News