Line-men work on powerlines in Batangas on January 27, 2020. Jonathan Cellona, ABS-CBN News/File

MANILA — The Supreme Court (SC) stressed that electric cooperatives do not have the Constitutional right to an exclusive franchise within their coverage areas as it denied the petition of Iloilo Electric Cooperative, Inc. (ILECO) I, II and III.

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In a decision of the en banc dated July 30, 2024, the court dismissed the petition for certiorari and prohibition filed by ILECOs which challenged the validity of Republic Act No. 11918, the law which expanded the franchise of MORE Electric and Power Corporation to areas within ILECOs’ franchise area.

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In denying the petition, the court ruled that Section 11, Article XII of the Constitution prohibits exclusive franchises. 

“A franchise, as a privilege granted by the state, is not the exclusive private property of the franchisee. Thus, it must yield to serve the common good, as determined by Congress,” the SC said a statement about the decision pennedy by Associate Justice Rodil Zalameda.

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The court also stressed that allowing the entry of another player benefits consumers who no longer have to wait until the expiry of ILECOs franchises in 2029, 2039 and 2053, in accordance with the Electric Power Industry Reform Act which encourages competition in the industry. 

“Without competition, ILECOs can easily dictate the price of electricity,” the SC said.

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