UCPB approves loan for Davao electric cooperative

Manila Times.net
Published : Friday, September 30, 2011 00:00 Written by : Lailany P. Gomez


UNITED Coconut Planters Bank (UCPB) has approved a multimillion-peso loan to finance the expansion of Davao del Norte Electric Cooperative.
In a statement, UCPB said it provided Daneco with a P326-million term loan to finance the upgrade of the distributor’s facilities and enable it meet the growing demand for electricity in its service areas.


Daneco will use the loan to double the capacity of two of its 10 substations from 10 megavolt ampere to 20, and rehabilitate its power lines, transformers and other distribution facilities and equipment.


The upgrade will benefit 125,900 households, commercial and industrial establishments, as well as government offices and public utilities that get their electricity from Daneco.


Daneco is one of the biggest electric cooperatives in the country, serving 374 barangays in Davao del Norte, Tagum City, the Island Garden City of Samal and Compostella Valley.


According to UCPB, power use in these areas has been growing at an average of 8 percent a year on account of the rise in business activities and the increase in the number of households.


Samal has enjoyed a surge in investments in tourism-related infrastructures and in residential property developments.


The UCPB loan is guaranteed by the LGU Guarantee Corp. under its regular guarantee program and the Electric Cooperative-Partial Credit Guarantee Program.


LGUGC is a private company established by the Bankers Association of the Philippines, the Development Bank of the Philippines and the Asian Development Bank to provide guarantee cover for loans to local development projects.


It administers the EC-PCG, a special guarantee program put up by the World Bank with a $10-million grant to the national government to encourage commercial banks to support rural electrification by financing the expansion and rehabilitation of the distribution facilities of electric cooperatives.


Daneco is the third power cooperative in Mindanao to receive financing from UCPB. The two others are Surigao del Norte Electric Cooperative and Cotabato Electric Cooperative, which received loans amounting to P85 million and P25 million, respectively.