The Energy Regulatory Commission (ERC) and the National Grid Corporation of the Philippines (NGCP) have signed a compromise agreement that resolves years of legal battles over regulatory fees, clearing the way for additional public funding. Signed Thursday at the ERC headquarters in Pasig, the pact settles long-running disputes over permit fees and annual supervision and regulation charges, with both sides agreeing to set aside their differing positions on the matter.
Under the agreement, NGCP acknowledges that the fees are properly imposed under ERC authority and will no longer challenge their status as regulatory charges in covered cases. The company previously maintained that its legislative franchise exempted it from such payments, and for years remitted the fees only under protest while filing appeals with the Court of Appeals and the Supreme Court. ERC held that these were administrative and regulatory costs, not taxes, and thus fell outside the scope of any franchise tax exemption. All amounts already paid, including those made under protest, will now count toward full satisfaction of NGCP’s obligations for the cases covered by the settlement.
Going forward, both past and future collections from these fees will be remitted to the National Treasury, providing additional government resources to fund programs including the delivery of basic social services. ERC Chairperson Atty. Francis Saturnino Juan noted that the agreement brings clarity and certainty to both parties, upholding the commission’s regulatory mandate while giving NGCP the firm legal footing it sought, and ensuring the public gains from funds that will now flow into national coffers. He described the deal as a model of constructive relations between regulator and regulated, built on mutual respect and shared public interest. The settlement also addresses a long-standing source of friction in the sector and forms part of ERC’s broader drive toward a fair, stable, and predictable power industry regulatory environment. The parties will submit the agreement to the Supreme Court and Court of Appeals for approval within 30 days.
