Bantayan power gets 15-day reprieve

Electric power in Bantayan Island won’t be cut off on Friday, at least not until June 15, an extended deadline to settle debts with a fuel supplier.

Cebu Gov. Gwendolyn Garcia said officials were able to persuade Petron, which supplies diesel fuel to the Bantayan Island Power Corp. (Bipcor), to continue delivering fuel for the next 15 days.

The reprieve would give Bantayan and Capitol officials time to find ways to pay the P30 million fuel bill of Bipcor.

The governor said she met with National Power Corp. (NPC) chairman Froilan Tampingco to discuss drastic cuts in their subsidy to Bipcor in the last three months.

Garcia said power outages in the island would pose serious damage to its poultry, aquaculture and tourism industries.

Bantayan Island is a major producer of eggs and high-value marine products like crabs.

Resorts, white-sand  beaches and the town’s heritage value as the oldest parish in Cebu make Bantayan a tourism destination.

“I told them we are doing our best to come up with a solution, and it take a little time,” Garcia told reporters.

Bipcor earlier received a demand letter from Petron, giving them until today , May 31, to settle its unpaid P30 million bill for one and a half months fuel supply.

The Bantayan Electric Cooperative (Banelco) and Bipcor, said the failure to pay Petron was due to cuts in the P5 million subsidy from the state-owned National Power Corp. in the last three months.

The troubled state-owned firm reportedly reduced its fuel subsidy to Bipcor as part of measures to recoup loses incurred from 2006-2009. The NPC has a pending petition with the Energy Regulatory Commission (ERC) for a P2.65 per kilowatt hour (kwh) increase in the generation charge.

Bipcor, a new private power producer (NPP), has a 15-year power supply agreement with Banelco starting 2006 to supply power at P5.05/ kwh.

Bipcor produces 6.64 megawatts from two diesel-fed power plants in the island.

Governor Garcia said she may apply the same solution which helped Camotes Island.

The Capitol loaned P9 million to the Camotes Island Electric Cooperative (Celco) to settle its debt with fuel suppliers.

The governor, however, admitted that Bantayan’s problem is more complicated.

“In this case, it does not only involve NPC’s recouping previous year’s losses, but also the complications caused by drastic cuts in NPC’s committed monthly subsidy to Bipcor,” she said.

Bipcor, she said, was having cash flow problems because the NPC subsidy was included as a constant in their financial projections.

The state-owned power firm gives subsidies to new private power producers as an incentive to promote rural electrification.

Bantayan mainland has three municipalities of Sta. Fe. Madridejos and Bantayan.

Poultry in the island has grown into a large-scale and highly specialized industry.

Bantayan is a major egg producer in the country and hosts a fledging aqua-culture industry.