The Supreme Court (SC) has definitively rejected the appeals filed by Iloilo Electric Cooperative I (Ileco I), Ileco II, and Ileco III, and the Philippine Rural Electric Cooperatives Association Inc. PHILRECA, cementing the Razon-led MORE Power’s authority to expand its electricity distribution into parts of Iloilo province.
In its May 20 resolution, the SC upheld the legality of MORE Power’s franchise expansion under Republic Act 11918, allowing it to distribute electricity beyond Iloilo City to Passi City and the towns of Alimodian, Anilao, Banate, Barotac Nuevo, Dingle, Dueñas, Dumangas, Leganes, Leon, New Lucena, Pavia, San Enrique, San Miguel, Santa Barbara, and Zarraga.
Petitioners had challenged the constitutionality of the decision, claiming it violated the Electric Power Industry Reform Act of 2001 (EPIRA) and encroached on cooperative service areas. They argued the law would create a power monopoly in Iloilo. The SC dismissed these claims, reiterating that utility franchises are non-exclusive and may be amended by Congress to advance public welfare.
Prompted by calls for more affordable and reliable electricity in 2021, MORE Power’s expansion into Iloilo province aims to roll out modern infrastructure and enhanced customer service. The company will phase in operations across new areas over the next four to five years.
MORE Power President and CEO Roel Z. Castro stated, “Electricity is a basic need. This decision enables us to serve more communities that deserve better power services.”
(Also read: Securing the Visayas Grid: The Vital Role of Baseload Power)
Davao Light’s expansion
Another case of an electric cooperative yielding to a more efficient distributor arose on April 6, 2025, when Republic Act No. 12144 lapsed into law, transferring power distribution in Tagum City, Samal Island, and parts of Davao del Norte and Davao de Oro from the Northern Davao Electric Cooperative (Nordeco) to Davao Light.
Consumer groups have long criticized Nordeco for providing unreliable and expensive electricity, citing unresolved complaints and frequent power outages. During senate hearings, lawmakers noted that Davao Light delivered more stable service at significantly lower rates, averaging ₱9.20 per kilowatt-hour compared to Nordeco’s ₱12.50, with fewer system losses and shorter power interruptions.
It was also revealed that customers in Nordeco’s coverage area experience outages averaging four hours per month, which is far longer than the 17-minute monthly average for Davao Light users.
Samal Island reportedly suffered ₱125 million in annual economic losses since 2021 due to persistent power problems, affecting tourism, businesses, fisheries, households, and public services.
On May 24, 2025, Nordeco petitioned the SC to halt the implementation of Republic Act 12144, arguing it was unconstitutional. The cooperative cited violations of its existing franchises, which remain valid in mainland areas until 2028 and in Samal Island until 2033.
However, the Davao Consumer Movement was quick to point out that the SC has already ruled against claims of exclusivity by electric cooperatives. In a July 30, 2024 decision concerning the Ilecos, the Court clarified that franchises are privileges granted by the state and not exclusive property rights.
“A franchise, as a privilege granted by the state, is not the exclusive private property of the franchisee,” declared the high court. “Thus, it must yield to serve the common good, as determined by Congress.”
The SC added that in the absence of competition, cooperatives like the ILECOs could set electricity rates without checks. Allowing another provider to enter promotes consumer welfare by offering alternatives, even before the ILECOs’ franchises expired in 2029, 2039, and 2053. This aligned with EPIRA’s goal of fostering competition in the power sector.
Nordeco recently emphasized that it is entitled to a two-year transition period and that Davao Light must first obtain a Certificate of Public Convenience before any takeover can proceed.
Davao Light clarified it aimed to work with, not replace, Nordeco by prioritizing the hiring of qualified Nordeco employees and sourcing from local suppliers. The company also committed to open dialogue to ensure a smooth transition.
(Also read: Electric Coops’ Underinvestment Threatens Panay Grid)
Mounting frustration among Batangas residents
Widespread dissatisfaction is growing among residents and local officials in Batangas over the performance of Batangas Electric Cooperative (BATELEC) 1 and 2, the province’s electric cooperatives.
A recent survey by Capstone-Intel in April found that 62% of households experience one to two outages each month, with some reporting as many as 10. Consumers under BATELEC 2 reported the most frequent service interruptions, with 93% affected compared to 81% under BATELEC 1.
While the standard outage duration is typically one to two hours, many residents endure brownouts lasting up to three hours.
Columnist Alex Magno observed that the poor performance of the two Batangas electric cooperatives has led to daily outages lasting up to 12 hours. “Power interruptions affect about half of all days annually,” he wrote. “They are most severe during the dry months.”
In June 2024, at least 18 Batangas mayors backed a proposed joint venture between Meralco and BATELEC 1 and 2. The resolution, passed during a League of Municipalities meeting, reflected growing support for the partnership, which would seek to stabilize electricity supply and ease the burden on households, businesses, and the broader local economy.
Meralco, the country’s top power utility, confirmed it has received requests from both local officials and consumers to help address Batangas’ persistent power interruptions. Executive Vice President Ronnie Aperocho stated the company is open to stepping in. “If Meralco could help improve the service in the entire province of Batangas, why not?” he said.
According to Aperocho, Meralco is exploring a possible joint venture but must first align with the National Electrification Administration (NEA) and other relevant agencies. He emphasized that any agreement would follow existing regulatory procedures.
Electric cooperatives must step up
Magno pointed out that, like many areas under electric cooperatives, the current power infrastructure relies on radial distribution and sub-transmission lines, which lack backup routes and adaptability during disruptions. He stressed the need for substantial investments to build a more resilient system that can better shield consumers from unexpected outages.
“Our system of electric cooperatives was designed for an earlier age when power demand was just a trickle compared to the deluge our modern economy now needs,” he wrote. “They are inadequate by design and unprepared to support an economy with a growing manufacturing base.”
Additionally, the Supreme Court’s ruling on MORE Power’s franchise expansion underscores that while electric cooperatives were established to accelerate rural electrification, the law also serves to protect consumers when service delivery falls short.
“It will not be easy to overhaul our system of electric cooperatives designed for an earlier age,” stated Magno. “But our economic progress demands precisely that overhaul.”
Sources:
https://tribune.net.ph/2025/06/14/more-powers-expanded-franchise-upheld-with-finality-by-sc
https://mb.com.ph/2025/06/14/sc-upholds-more-powers-expansion-in-iloilo-with-finality
https://www.sunstar.com.ph/davao/davao-light-franchise-expansion-becomes-law
https://www.facebook.com/photo?fbid=1012838544217591&set=a.446974487470669&_rdc=1&_rdr#
https://www.facebook.com/photo?fbid=1015272793974166&set=a.446974487470669&_rdc=1&_rdr
https://www.pna.gov.ph/articles/1227905
https://www.sunstar.com.ph/davao/nordeco-challenges-davao-light-franchise-expansion-at-supreme-court
https://www.pna.gov.ph/articles/1230320
https://edgedavao.net/latest-news/2025/03/davao-light-willing-to-sit-down-with-nordeco
https://www.capstone-intel.com/survey-power-disruptions-erode-public-trust-in-batangas-utilities
https://www.philstar.com/opinion/2025/04/05/2433566/inadequate
https://www.philstar.com/business/2024/06/29/2366293/meralco-batelec-jv-gains-traction
https://businessmirror.com.ph/2025/05/01/meralco-keen-on-helping-batangas-ecs