BY EUAN PAULO C. AÑONUEVO REPORTER

MANILA Electric Co. (Meralco) has asked the Regional Trial Court (RTC) of Pasig for consent in pushing through with a multibillion settlement agreement with state-owned National Power Corp. (Napocor).

The settlement agreement contains a pass-through provision, which allows Meralco to pay Napocor the net settlement amount from collections recovered from its customers once approved by the Energy Regulatory Commission (ERC).

In a petition submitted to the Pasig RTC, Meralco said the agreement it entered into with Napocor did not violate any law or government procedure as alleged by the Office of the Solicitor General (OSG).

The case stems from Napocor’s claim that the country’s largest electricity distribution utility owed it P56 billion, which ballooned from the original P20 billion over the years because of unsettled collections under a 10-year power supply contract that lapsed in December 2004.

The two, however, came to terms with a settlement agreement that led to a reduction in the amount Napocor sought to only P14 billion.

The agreement did not sit well with the OSG, which claimed that Napocor should have consulted concerned government agencies first before entering into an agreement with Meralco.

But the utility said in its petition that “no law requires Napocor to obtain OSG approval” and that “the Commission on Audit’s power to compromise Napocor claims does not cover the unsettled claims” that were compromised under its settlement agreement with Meralco.

The ERC has been hearing the case for several years already as this may affect power rates.

Citing issues raised by the OSG, Meralco asked the regulator to suspend the proceedings, which it said should be relegated to the proper courts.

Because of this, the ERC opted to keep its hands off the Meralco Napocor deal.

”The ERC has no jurisdiction over such issue as this should more appropriately be threshed out before the regular courts,” Francis Saturnino Juan, ERC executive director, earlier said.