By Joyce Pangco Panares Posted on May 16, 2013 at 12:02am
President Benigno Aquino III has signed into law a measure authorizing the National Electrification Administration to regulate electric cooperatives.
Republic Act 10531 aims to strengthen the NEA in bringing electricity to rural areas while ensuring the economic viability of electric cooperatives for retail competition.
Under the new law, the electrification program in missionary areas will be done in coordination with the National Power Corp.’s Small Power Utilities Group.
As mandated, NEA will restructure ailing electric cooperatives to make them financially viable; develop and enforce governance standards for efficient operation of electric cooperatives; serve as guarantor to qualified electric cooperatives in transactions; grant loans to cooperatives for acquisition and maintenance of facilities; and impose sanctions and file cases against violators.
RA 10531 also increases the capital stock of NEA to P25 billion divided into P250,000 shares with a par value of P100.
The additional “supervisory powers” of the NEA over electric cooperatives include the authority to conduct investigations, issue preventive or disciplinary measures against erring electric cooperatives, and appoint independent board of directors in electric cooperatives.
The law also empowered NEA to “step-in and take over” operations of “distressed” electric cooperative.
“Within a reasonable period after take-over, the NEA may convert the ailing cooperative to either a stock cooperative or a stock corporation registered with the Securities and Exchange Commission,” the law said. source
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