State-run National Electrification Administration (NEA) has formed a task force and a management team to temporarily oversee the management and operations of a debt-saddled electric cooperative in Zamboanga City, days after the stakeholders’ meeting.
NEA Administrator Edgardo Masongsong issued Office Order No. 2018-073 creating the Task Force Duterte Zamboanga City Power (TFD-ZCP) “to address the deteriorating operational performance and financial conditions” of the Zamboanga City Electric Cooperative, Inc. (Zamcelco).
Signed last August 16, the NEA order was pursuant to Section 6 of Republic Act No. 10531, otherwise known as the “National Electrification Administration Reform Act of 2013.”
According to Masongsong, the creation of TFD Zamboanga City Power was also in response to the clamor for the NEA to intervene while the rebidding for the investment management contract (IMC) is ongoing.
The task force will be chaired and co-chaired by the presidents of the Association of Mindanao Rural Electric Cooperatives (AMRECO) and the National Association of General Managers of Electric Cooperatives (NAGMEC), respectively.
Other members of the task force are the heads of the National Center of Electric Cooperative Consumers, Inc. (NCECCO), the Philippine Rural Electric Cooperatives Association, Inc. (PHILRECA), and the Philippine Federation of Electric Cooperatives (PHILFECO).
Meanwhile, deputy administrators of the NEA Special Concerns Office (SCO), Legal Services Office (LSO), and Electric Cooperative Management Services (ECMS) have been designated to support the task force.
As such, TFD Zamboanga City Power will perform the duties and responsibilities an Electric Cooperative Board of Directors prescribed under NEA Bulletin No. 35.
Correspondingly, the NEA formed a management team that will be composed by the general managers of different electric cooperatives, namely Zamboanga del Norte Electric Cooperative, Inc. (Zaneco), Zamboanga del Sur I Electric Cooperative, Inc. (Zamsureco I), Misamis Occidental II Electric Cooperative, Inc. (MOELCI II), Cebu III Electric Cooperative, Inc. (Cebeco III), Davao del Sur Electric Cooperative, Inc. (Dasureco), Benguet Electric Cooperative, Inc. (Beneco), and Pampanga II Electric Cooperative, Inc. (Pelco II).
The management team is tasked, among others, to oversee the operations of Zamcelco, manage the day-to-day operations, review its governance policies and practices, and institute measures for reforms.
It is also authorized to initially institute measures in the management and operational performance towards NEA standards “until such time that the engagement of an Investment Management Contract is consummated.”
“The functions of the current Board of Directors of Zamcelco shall be limited only to completing the engagement of an IMC.”
“The functions of the current Board of Directors of Zamcelco shall be limited only to completing the engagement of an IMC,” said the NEA order.
Last August 10, NEA officials led by Masongsong met with Zamcelco stakeholders to discuss ways to address issues besetting the power utility. The meeting was attended by Zamboanga Representatives Celso Lobregat and Manuel Jose Dalipe, and Mayor Maria Isabelle Climaco-Salazar.
Zamcelco has a system loss of 22.09 percent as of December 2017—higher than the cap of 13 percent set by the Energy Regulatory Commission (ERC)—and about P2.145 billion in debts to its power suppliers, including a P373.897 million loan from the NEA as of August 9, 2018.
