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NGCP asked to defer power disconnection in Albay

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07:16 PM June 27th, 2013

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By: Mar S. Arguelles, June 27th, 2013 07:16 PM

LEGAZPI CITY, Philippines—The National Grid Corporation of the Philippines postponed cutting off the power supply to the Albay Electric Cooperative (Aleco) amid appeal from Albay mayors to allow the cash-strapped cooperative to find means to pay its debts and for newly elected officials to take their oaths of office first.

The NGCP was earlier set to cut by Thursday its power supply to Aleco for the cooperative’s failure to settle its April and May electric bills amounting to P170 million with the Philippine Electricity Market Corp.

The NGCP, however, decided to defer the power disconnection after Energy Secretary Jericho Petilla on Thursday approved the request of the League of Municipalities and the League of Cities to give Aleco time to raise funds to settle its account with PEMC, said Aleco spokesperson Hazel Morallos.

Morallos, in a phone interview, said the letter of appeal was jointly signed by Legazpi City Mayor Geraldine Rosal, president of the League of Cities, and Daraga Mayor Gerry Jaucian, president of the League of Municipalities of Albay.

The league also said that the province could not be without electricity with new and reelected local officials in the provincial level and in its 15 town and three cities still have to hold their respective inaugural ceremonies to mark the start of their new terms of office on June 30. Rosal and Jaucian have both been reelected.

Another reason cited in the letter was that Albay would be holding a big event on Friday, attempting to form the “World Largest Human No Smoking Sign” for the Guinness World Record at the football grounds of Bicol University in this city.

Morallos said the PEMC, after considering the request, gave the cooperative until July 3 to settle its account for April and May this year or else it would carry out the disconnection order.

The Aleco management is currently under the supervision of the National Electrification Administration after the cooperative suffered huge financial losses due to mismanagement, high system loss and antiquated power transformers and equipment.

Aleco’s system loss is at 25.17 percent, way above the 13 percent allowable cap by the Energy Regulatory Commission guidelines. As a result, Aleco subsidizes the system loss above cap at around P14 million a month.

Aleco is also saddled with a close to P4-billion debt it incurred with various power producers, including the PEMC, the National Power Corporation, Wholesale Electricity Spot Market and the National Electrification Administration.

The Aleco interim board of directors headed by Legazpi Bishop Joel Baylon has been trying to privatize the cooperative’s operation through the Private Sector Participation (PSP) scheme, which would have allowed a private power firm to operate the cooperative for 25 years, but it has been blocked by an anti-privatization group of consumers who were able to obtain temporarily restraining order from a court here.

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