G.R. No.

159796 July 17, 2007

ROMEO P. GEROCHI, KATULONG NG BAYAN (KB) and ENVIRONMENTALIST CONSUMERS NETWORK, INC. (ECN), petitioners
vs
DEPARTMENT OF ENERGY (DOE), ENERGY REGULATORY COMMISSION (ERC), NATIONAL POWER CORPORATION (NPC),
POWER SECTOR ASSETS AND LIABILITIES MANAGEMENT GROUP (PSALM Corp.), STRATEGIC POWER UTILITIES GROUP
(SPUG), and PANAY ELECTRIC COMPANY INC. (PECO), respondents.

FACTS:
On June 8, 2001 Congress enacted RA 9136 or the Electric Power Industry Act of 2001. Petitioners Romeo P. Gerochi and company
assail the validity of Section 34 of the EPIRA Law for being an undue delegation of the power of taxation. Section 34 provides for the
imposition of a “Universal Charge” to all electricity end users after a period of (1) one year after the effectively of the EPIRA Law. The
universal charge to be collected would serve as payment for government debts, missionary electrification, equalization of taxes and
royalties applied to renewable energy and imported energy, environmental charge and for a charge to account for all forms of cross
subsidies for a period not exceeding three years. The universal charge shall be collected by the ERC on a monthly basis from all end
users and will then be managed by the PSALM Corp. through the creation of a special trust fund.

ISSUE:
Whether or not there is an undue delegation of the power to tax on the part of the ERC

RULING:
No, the universal charge as provided for in section 34 is not a tax but an exaction of the regulatory power (police power) of the state.
The universal charge under section 34 is incidental to the regulatory duties of the ERC, hence the provision assailed is not for
generation of revenue and therefore it cannot be considered as tax, but an execution of the states police power thru regulation.
Moreover, the amount collected is not made certain by the ERC, but by the legislative parameters provided for in the law (RA 9136)
itself, it therefore cannot be understood as a rule solely coming from the ERC. The ERC in this case is only a specialized administrative
agency which is tasked of executing a subordinate legislation issued by congress; which before execution must pass both the
completeness test and the sufficiency of standard test. The court in appreciating Section 34 of RA 9136 in its entirety finds the said law
and the assailed portions free from any constitutional defect and thus deemed complete and sufficient in form.