Republic of the Philippines ENERGY REGULATORY COMMISSION ‘San Miguel Avenue, Pasig City IN THE MATTER) OF THE APPLICATION FOR THE APPROVAL OF: 1) THE DISTRIBUTION LOAD IMPROVEMENT AND LOAD BALANCE IMPROVEMENT OF __ VARIOUS SECTIONS OF THE DISTRIBUTION SYSTEM OF THE PANGI SUBSTATION COVERAGE AREA 2) THE DISTRIBUTION CODE COMPLIANCE AND REHABILITATION OF DANDA SUBSTATION, AND DISTRIBUTION LOAD AND LOAD AND PHASE BALANCE IMPROVEMENT OF THE DANDA SUBSTATION COVERAGE AREA 3) THE REPLACEMENT OF POWER TRANSFORMER — AND REFURBISHING OF _ SIRAWAI SUBSTATION, AND DISTRIBUTION LOAD AND LOAD BALANCE IMPROVEMENT OF —_ VARIOUS SECTIONS OF __ DISTRIBUTION SYSTEM OF SIRAWAI SUBSTATION COVERAGE AREA 4) THE UPGRADING OF 10 KM. 13.2 KV IMELDA ALICIA _ DISTRIBUTION LINES, AND DISTRIBUTION LOAD IMPROVEMENT, LOAD AND PHASE BALANCE IMPROVEMENT AND REACTIVE VOLTAGE IMPROVEMENT OF VARIOUS SECTIONS OF DISTRIBUTION SYSTEM OF STA. BARBARA S/S COVERAGE AREA 5) THE UPGRADING OF RT. LIM SUBSTATION, AND DISTRIBUTION LOAD AND LOAD AND PHASE BALANCE IMPROVEMENT OF. VARIOUS. SECTIONS OF DISTRIBUTION SYSTEM OF R.T. LIM SIS COVERAGE AREA AND 6) THE PROCUREMENT OF ENGINEERING ANALYSIS SOFTWARE, AUTOMATED BILLING SYSTEM, TEST EQUIPMENT AND MAINTENANCE VEHICLE, WITH PRAYER FOR ~—_— PROVISIONAL AUTHORITY ZAMBOANGA DEL SUR I! ELECTRIC COOPERATIVE, INC. (ZAMSURECO m, Applicant. SOATORP KE “apy Posting were goiph ERC CASE NO. 2007-535 MC Espproved for) % =ERC Case No. 2007-535 MC DECISION/June 4, 2008 Page 2 of 12 DECISION Before this Commission for resolution is the application filed on December 21, 2007 by Zamboanga del Sur Il Electric Cooperative, Inc. (ZAMSURECO Il) for approval of: 1) the distribution load improvement and load balance improvement of various sections of the distribution system of the Pangi Substation coverage area; 2) the distribution code compliance and rehabilitation of Danda Substation, and distribution load and load and phase balance improvement of the Danda Substation coverage area; 3) the replacement of power transformer and refurbishing of Sirawai Substation and distribution load and load balance improvement of various sections of distribution system of Sirawai Substation coverage area; 4) the upgrading of 10 km. 13.2 kV Imelda — Alicia Distribution Lines, and distribution load improvement, load and phase balance improvement and reactive voltage improvement of various sections of distribution system of Sta. Barbara Substation coverage area; 5) the upgrading of RT. Lim Substation, and distribution load and load and phase balance improvement of various sections of distribution system of R.T. Lim Substation coverage area; and 6) the procurement of engineering analysis software, automated billing system, test equipment and maintenance vehicle, with prayer for provisional authority. Having found said application sufficient in form and in substance with the required fees having been paid, an Order and a Notice of Public Hearing, both dated January 8, 2008, were issued setting the case for initial hearing and pre- trial conference on February 18, 2008.ERC Case No. 2007-535 MC DECISION/June 4, 2008 Page 3 of 12 In the same Order, ZAMSURECO II was directed to cause the publication i the Notice of Public Hearing, at its own expense, once (1x) in a newspaper of general circulation in the Philippines, at least (10) days before the scheduled date of initial hearing. It was also directed to inform the consumers, within its franchise area, by any other means available and appropriate, of the filing of the instant application, its reasons therefor, and of the scheduled hearing thereon. The Office of the Solicitor General (OSG), the Commission on Audit (COA) and the Committees on Energy of both Houses of Congress were furnished with copies of the Order and the Notice of Public Hearing and were requested to have their respective duly authorized representatives present at the initial hearing. Likewise, the Offices of the Mayors of the Municipalities within ZAMSURECO I's franchise area were furnished copies of the Order and Notice of Public Hearing for the appropriate posting thereof on their respective bulletin boards. On February 13, 2008, ZAMSURECO Il filed its “Pre-Trial Brief. During the February 18, 2008 initial hearing of this case, only ZAMSURECO I appeared. No intervenor/oppositor appeared nor was there any intervention/opposition registered. In the said hearing, ZAMSURECO 1I presented its proofs of compliance with the Commission's posting and publication of notice requirements which were duly marked as Exhibits “A” to “EE-1", inclusive. Thereafter, it conducted an f expository presentation of its may a ye