What constitutes reasonable price in rate-fixing?

As to what constitutes a reasonable price in terms of rate-fixing, the Supreme Court, in Republic v. MERALCO,[1] held that:

x x x In the fixing of rates, the only standard which the legislature is required to prescribe for the guidance of the administrative authority is that the rate be reasonable and just. It has been held that even in the absence of an express requirement as to reasonableness, this standard may be implied. What is a just and reasonable rate is a question of fact calling for the exercise of discretion, good sense, and a fair, enlightened and independent judgment. The requirement of reasonableness comprehends such rates which must not be so low as to be confiscatory, or too high as to be oppressive. In determining whether a rate is confiscatory, it is essential also to consider the given situation, requirements and opportunities of the utility.[2] (Emphasis supplied.)

In Solid Homes Inc. v. Payawal,[3] the Court explained that administrative agencies are considered specialists in the fields assigned to them; hence, they can resolve problems in their respective fields "with more expertise and dispatch than can be expected from the legislature or the courts of justice."[4] Thus, the Court has consistently accorded respect and even finality to the findings of fact of administrative bodies, in recognition of their expertise and technical knowledge over matters falling within their jurisdiction.[5]

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[1]440 Phil. 389 (2002).

[2]Id. at 398-399.

[3]257 Phil. 914(1989)

[4]Id. at 921.

[5]Galindez v. Firmalan, et al., G.R. No. 187186, June 6, 2018, 864 SCRA 282, 299 citing JMM Promotions and Management v. Court of Appeals, 439 Phil. 1, 10-11 (2002).