Electric co-ops wary of entry of 3rd party providers

MANILA, Philippines — Electric cooperatives (ECs) have expressed concern over a plan of the Department of Energy (DOE) to let third-party power providers enter their franchise areas.

Philippine Rural Electric Cooperatives Association Inc. (Philreca) president Presley de Jesus said only a few ECs are non-performing.

“Forty eight years of rural electrification program is a testament to our resilience and steadfast dedication to its goal,” he said. “Thus, and with all due respect, the policy on private sector participation in rural electrification program is based on a wrong predicate: that there are non-performing ECs who are considered barriers to total electrification.”

In a joint statement, Philreca and the Philippine Federation of Electric Cooperatives (Philfeco) appealed against widespread misconception that power coops are generally ineffective. Citing official data, the groups said only eight percent out of the total 121 ECs in the Philippines are considered problematic.

“And these are likewise not caused by our perceived operational inefficiency, but due to events and situations beyond our control like natural calamities, political strife, insurgency, and more often than not topographic challenges,” De Jesus said.

The DOE is reviewing identified areas for possible operations of third party electricity providers as part of its rural electrification program.

By 2022, the agency targets 100 percent electrification with the National Electrification Administration (NEA), National Power Corp. and distribution utilities (DUs).

The EC groups fear that a state policy on the entry of deep-pocketed private firms in rural electrification lays the groundwork for their cooperatives to succumb, affecting the welfare of their stakeholders.

Philippine Association of Board of Directors of Rural Electric Cooperatives (PABREC) president Reynaldo Lazo has called on government to protect the ECs against private companies that have vested interests on potentially auspicious communities.

“I am okay with the pronouncement of the DOE, knowing it will benefit the member-consumers in areas that are not yet electrified. Encouraging private (sector) participation is fine as long as it does not interfere and encroach on the operations of the ECs,” he said.