G.R. No. L-21804 September 25, 1967
TERESA ELECTRIC AND POWER CO., INC., petitioner, vs. PUBLIC SERVICE COMMISSION and FILIPINAS CEMENT CORPORATION, respondents.

FACTS

Petitioner Teresa Electric Light and Power Co., Inc. (Teresa Electric) is a domestic corporation operating an electric plant in Teresa, Rizal, under a subsisting certificate of public convenience and necessity. Respondent Filipinas Cement Corporation (Filipinas) is a domestic corporation engaged in manufacturing cement. On May 24, 1962, Filipinas filed an application with the Public Service Commission (PSC) for a certificate of public convenience to install, maintain, and operate an electric plant at its factory site in Teresa, Rizal, to supply electric power and light exclusively to its cement factory and its employees living within its compound. Teresa Electric filed an opposition, alleging it was the authorized operator in the area, that Filipinas’s articles of incorporation did not authorize it to operate an electric plant, that no municipal council authorization was secured, that it was willing to supply Filipinas’s needs, and that Filipinas’s principal business was outside the PSC’s jurisdiction. During hearings, Filipinas presented evidence, and Teresa Electric’s counsel cross-examined witnesses. On the date set for Teresa Electric to present its evidence, its counsel filed an urgent motion for postponement due to a conflicting hearing in Caloocan City. The PSC denied the motion, as the hearing date was set after consulting both parties’ calendars, and considered the case submitted for resolution. The PSC granted Filipinas’s application on March 15, 1963. Teresa Electric’s motion to set aside the decision and reopen the case was denied, prompting this petition for review.

ISSUE

1. Whether Filipinas needed to secure a municipal or legislative franchise before being entitled to a certificate of public convenience and necessity to operate an electric plant.
2. Whether Filipinas’s articles of incorporation authorized it to operate and maintain an electric plant.
3. Whether Filipinas could be granted a certificate of public convenience and necessity despite the existence of another electric plant operator (Teresa Electric) in the same municipality.

RULING

1. No. Act No. 667 , which requires a municipal or legislative franchise, applies to persons or corporations seeking to construct and maintain an electric line or plant for business purposes—i.e., to render service to the general public for compensation subject to government regulation. Filipinas’s application was to operate an electric plant exclusively for its own use in its cement factory and for its employees within the compound (the latter free of charge), not for public service. Therefore, only a certificate of public convenience and necessity from the PSC was required.
2. Yes. Paragraph 7 of Filipinas’s Articles of Incorporation authorizes it to secure and utilize rights, powers, privileges, franchises, and concessions from governmental authorities. Furthermore, the articles allow the corporation to perform all acts connected with or incidental to the business of manufacturing cement. The operation of an electric plant is necessarily connected with and incidental to the modern operation of a cement manufacturing business.
3. Yes. While operators of public services deserve protection from unnecessary competition, no one has an exclusive right to a franchise or certificate. The primordial consideration is public service and interest. Moreover, it was established that Teresa Electric’s load capacity was only 200 kilowatts, whereas Filipinas needed 6,000 kilowatts to operate its cement factory. Therefore, Teresa Electric was incapable of supplying Filipinas’s power needs. The PSC’s decision granting the certificate to Filipinas was affirmed.