2 co-ops question ERC chief’s renewal of power contracts

Two electric cooperatives in Mindanao have questioned the orders of embattled Energy Regulatory Commission (ERC) chair Jose Vicente Salazar extending their respective contracts with a power generator without their knowledge.

In separate letters, Lanao del Norte Electric Cooperative Inc. (Laneco) and Davao Oriental Electric Cooperative Inc. (Doreco) informed Salazar that they did not sign any contracts renewing their power purchase agreement (PPA) with FDC Misamis Power Corp.

Interestingly, Salazar approved the renewal of five purchase agreements just three days after FDC filed its petition on Jan. 23.

Besides the power supply deals with Doreco and Laneco, Salazar also granted the extension of FDC’s contracts with South Cotabato II Electric Cooperative Inc., Misamis Occidental II Electric Cooperative Inc. and Bukidnon Second Electric Cooperative Inc.

Doreco said it was unaware that FDC had asked the ERC to renew their agreement with the same electricity rates when the two parties signed the deal in April 2015.

“We respectfully manifest to the honorable commission that Laneco was not made aware of the filing of the manifestation. Laneco’s receipt… of the electronic copy of the order… came as a surprise,” Doreco said in its Feb. 10 letter, a copy of which was obtained by the Inquirer on Tuesday.

Moreover, it said it informed FDC as early as Oct. 13, 2016, or more than two months before the deal’s expiry, that it was not interested in renewing the agreement.

In its letter to Salazar, Doreco said: “At the onset, it should be noted that Doreco was not joined by FDC Misamis in the filing of the manifestation… and in fact, it was unaware thereof.”

A senior ERC official, who asked not to be named for fear of reprisal from Salazar, said the ERC chair arbitrarily approved the extension of the deals without the consent of the four other ERC commissioners.

“That has been Salazar’s policy since he became the ERC chair. He made many decisions and resolutions on his own, bypassing the authority of the entire commission and its members,” the official said.

In five separate orders dated Jan. 26, Salazar said the electric cooperatives “may continue to draw power from FDC Misamis during the extended period.”

Salazar, a former justice undersecretary, has been under fire since the tragic death of ERC Director Francisco Villa Jr. in November last year.