Philreca warns against gov’t-backed corporate takeover of electric coops

VIGAN CITY, Philippines – Organizations of electric cooperatives in the country warned of a government-backed corporate takeover of their services during their Black Valentine’s Day online protest on Monday, February 14.

The Philippine Rural Electric Cooperatives Association, Incorporated (Philreca) said recent government actions and issuances show signs of a push for the corporate takeover of electric cooperatives.

“Based on recent events and pronouncements of this administration, it is very clear that the intention indeed is towards the privatization,” said Philreca Representative Presley de Jesus.

He cited President Rodrigo Duterte’s warning to allow private corporations to take over the Palawan Electric Cooperative (Paleco) and Executive Order No. 156. 

EO 156, issued on December 11, transferred the step-in power of the National Electrification Administration (NEA) of ailing electric cooperatives to the Office of the President.

Philreca executive director Janeene Depay-Colingan said electric cooperatives franchises are under threat by corporations who applied for licenses in areas already covered by their services.

“Clearly, they have noticed the potential for profitability in these areas. I say potential profitability because as far as ECs are concerned, they are service-oriented entities, and profit is not included in the amount that they collect from their consumers,” she said.

According to De Jesus, “oligarchs” are spreading wrong information that electric cooperatives are underperforming and must be privatized.

“It’s not true. We have only a few underperforming electric cooperatives that are in the BARMM (Bangsamoro Autonomous Region in Muslim MIndanao) area because of security reasons,” he added.

Alarming policy shift

The Philippine Association of Board of Directors of Electric Cooperatives (Phabdrec) expressed concern about the overreaching directives released by NEA in recent months.

Phabdrec president Gloria Corrales said their most significant concern is NEA Memo 2021-055, which amended the appointment process and electric cooperative general managers’ qualifications in NEA Memo 2017-035.

The revised directive transferred the power to appoint and terminate general managers to NEA, which was reserved previously to the Board of Directors (BOD) of electric cooperatives.

“The power to hire, select, and appoint a general manager has always been and should always be with the people who own the electric cooperatives, the member-consumer-owners,” Corrales said.

“And as the direct representatives of MCOs, as the elected representatives, we, the board of directors, are empowered by the Constitution and By-laws of the electric cooperatives to appoint the general manager. Even previous issuances of the NEA were aligned to this,” she added.

The order came amid the ongoing leadership row in the Benguet Electric Cooperative (Beneco), stemming from NEA’s appointment of former Palace official Anna Maria Rafael to head the electric utility. The majority of the Beneco BOD rejected her and chose Beneco assistant general manager Melchor Licoben.

The dispute has also triggered an exchange of accusations between NEA and De Jesus of overreaching their mandates.

On September 23, 2021 the House of Representaatives passed Resolution No. 213 to strictly comply with NEA Memo 2017-035 in selecting electric coop general managers and status quo on the Beneco issue. The energy agency ignored the resolution.

Covenant with Robredo

Vice President and presidential bet Leni Robredo recently signed a 10-point agenda “to achieve genuine and sustainable development for the Filipino people, especially those in the countryside,” with electric cooperative organizations.

De Jesus said that the covenant shows their trust and support for the Vice President, and “the hope for her to be a visionary and genuine president who will always uphold the rule of law and will always prioritize the welfare of the public over the interests of the few.”

Robredo has bucked suggestions to privatize electric cooperatives.

During her visit to Baguio City in December 2021, the Vice President stressed that instead of intervening in the appointment of general managers, NEA should focus its resources on empowering electric cooperatives. She also lauded Beneco member-consumers for their action in protecting the cooperative. – Rappler.com

Sherwin de Vera is a Luzon-based journalist and an awardee of the Aries Rufo Journalism Fellowship.