Mayor to Ceneco: Stop buying power from PEDC

By Carla N. Canet

Tuesday, July 5, 2011

BACOLOD City Mayor Evelio Leonardia supported the move to file petition for the Central Negros Electric Cooperative (Ceneco) to immediately stop purchasing power from Panay Energy Development Corp. (PEDC) and collecting charges from its consumers.

The National Association of Electricity Consumers for Reforms Inc. filed a petition before the Energy Regulatory Commission (ERC) asking it to order Ceneco and its officers to stop purchasing power from PEDC.

“We want to know the naked truth about the transaction considering that Ceneco has refused the offer by Green Core of a cheaper power cost and favoured PEDC despite the big price difference. I was just concerned then when Green Core complained why Ceneco resisted their offer, which is the cheapest during that time. People are suspecting that there might be an anomaly there considering that under normal circumstance, one will buy a cheaper power,” he said.

He added that getting power from Green Core is more accessible because it is generated here.

I hope that this group and the new set of Board of Directors of Ceneco will do something that will truly reduce the cost of power in the province.

The issue here is on who can best serve the consumers with a reasonable power rate, the mayor said.

Meanwhile, the National Association of Electricity Consumers for Reforms (Nasecor), represented by its president Pete Ilagan, also asked ERC to order Ceneco general manager Sulpicio Lagarde Jr. to immediately submit to the commission, under oath, all records of Ceneco on purchases of power from PEDC and the charges collected from its consumers.

It also asks the ERC to impose on the respondents the penalties provided under Section 45 of the Electric Power Industry Reform Act.

Aside from Lagarde, the other respondents are former Ceneco Board president Edward Gasambelo, directors Luis Cuenca, Zenaida Lacson, Arnel Lapore, Paul Lizares, Michael Maravilla, Roberto Montelibano and former director Raul Alvarez Jr.

Ilagan said they have noted that Ceneco and PEDC have been implementing and continue to implement a contract for the supply of power, and charging to the consumers the cost of electricity purchased, without the prior consent of the ERC.

If there is no prior approval from the ERC, then passing on and collection of the cost of electricity to the consumers is illegal and in violation of the Epira, he said.

Ilagan said records of ERC will reveal that Ceneco has not complied with its obligation under the Epira, to obtain the Commission’s approval of the supply contract. Worse, Ceneco has not even submitted the contract to ERC for approval, he said.

Ilagan said that if Ceneco had not failed and refused to comply with the legal regulatory requirements, its customers would have paid only P2.3081 per kilowatt hour (KWH) for the testing and commissioning power from PEDC as determined by the ERC, instead of P4/KWH for the same power, which is double the amount.

As a result, Ceneco’s customers have paid an additional and unnecessary P77.9 million from December 2010 to March 2010, he said.

Based on records, it cannot be determined when Ceneco began illegally collecting charges and overcharging its customers, and how much exactly was illegally charged to its customers, he added.

Ilagan said that since the illegal collection of generation charge was perpetrated by Ceneco’s officers, who purposely and intentionally failed to seek the ERC’s approval, the amounts allegedly illegally collected from the Ceneco’s customers must be refunded personally by the respondent officers of Ceneco.

Meanwhile, Lagarde said Monday they have not yet received an order from the ERC asking them to explain.

He said that once they receive the order from the ERC, they will have it published together with their answer, he said.

Lagarde said in order not to pre-empt the ERC, they will wait for the commission to ask them to explain why the complaint should not be given due course.

He said whatever they did, they did it for the interest of the consumers.

He explained that because there were frequent brownouts in 2010, they had to source out power elsewhere when their contract with Green Core expired so they were able to get cheaper source of power.

Published in the Sun.Star Bacolod newspaper on July 05, 2011.