ASSOCIATION OF SOUTHERN TAGALOG ELECTRIC COOPERATIVE, INC. vs. ENERGY REGULATORY COMMISSION | G.R. No. 192117 | September 18, 2012

ASSOCIATION OF SOUTHERN TAGALOG ELECTRIC COOPERATIVE, INC. vs. ENERGY REGULATORY COMMISSION
G.R. No. 192117, September 18, 2012 

Facts 

Petitioners Batangas I Electric Cooperative, Inc., Quezon I Electric Cooperative, Inc., Quezon II Electric Cooperative, Inc. and Pampanga Rural Electric Service Cooperative, Inc. are rural electric cooperatives established under Presidential Decree (P.D.) No. 269 or the National Electrification Administration Decree. BATELEC I, QUEZELCO I and QUEZELCO II are members of the Association of Southern Tagalog Electric Cooperatives, Inc. PRESCO is a member of the Central Luzon Electric Cooperatives Association, Inc. Petitioners are engaged in the distribution of . On 8 December 1994, R.A. No. 7832 was enacted. The law imposed a limit on the recoverable rate of system lossthat may be charged by rural electric cooperatives to their consumers. The Implementing Rules and Regulations of R.A. No. 7832 required every rural electric cooperative to file with the Energy Regulatory Board on or before 30 September 1995, an application for approval of an amended PPA Clause incorporating the cap on the recoverable rate of system loss to be included in its schedule of rates. On 8 June 2001, R.A. No. 9136 or the Electric Power Industry Reform Act of 2001 was enacted. Section 38 of the EPIRA abolished the ERB, and created the Energy Regulatory Commission. The powers and functions of the ERB not inconsistent with the provisions of the EPIRA were transferred to the ERC, together with the applicable funds and appropriations, records, equipment, property and personnel of the ERB. All electric cooperatives were directed to implement the PPA in the manner the then Energy Regulatory Board had prescribed. Subsequently, the ERC issued policy guidelines on the treatment of discounts extended by power suppliers. Petitioners attack the validity of the 22 March 2006 Order, 16 February 2007 Order, 7 December 2005 Order, and 27 March 2006 Order of the ERC directing the refund of over recoveries for having been issued pursuant to ineffective and invalid policy guidelines. Petitioners assert that the policy guidelines on the treatment of discounts extended by power suppliers are ineffective and invalid for lack of publication, non-submission to the U.P. Law Center, and their retroactive application. 

Issue
 
Whether the policy guidelines issued by the ERC on the treatment of discounts extended by power suppliers are ineffective and invalid for lack of publication, non-submission to the University of the Philippines (U.P.) Law Center, and their retroactive application. 

Ruling
 
The Supreme Court held that publication is a basic postulate of procedural due process. Article 2 of the Civil Code, as amended by Section 1 of Executive Order No. 200, states that "laws shall take effect after fifteen days following the completion of their publication either in the Official Gazette or in a newspaper of general circulation in the Philippines, unless it is otherwise provided." Covered by this rule are presidential decrees and executive orders promulgated by the President in the exercise of legislative powers whenever the same are validly delegated by the legislature or, at present, directly conferred by the Constitution. Administrative rules and regulations must also be published if their purpose is to enforce or implement existing law pursuant also to a valid delegation. However, there are several exceptions to the requirement of publication such as an interpretative regulation. It seeks to regulate only the personnel of the administrative agency and not the general public. The policy guidelines of the ERC on the treatment of discounts extended by power suppliers are interpretative regulations. The policy guidelines merely interpret R.A. No. 7832 and it‘s IRR, particularly on the computation of the cost of purchased power. The policy guidelines did not modify, amend, or supplant the IRR. Hence, it is exempt from the publication requirement. 

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