NEA files power-rate hike for Aleco

Business Mirror

15 Dec 2013 

 

Written by Manly M. Ugalde / Correspondent

LEGAZPI CITY—Unknown to the 250,000 electric consumers of Albay, the National Electric Administration (NEA) has filed for a power-rate increase in anticipation of the final takeover by the San Miguel Corp. (SMC), who recently acquired the bankrupt electric cooperative.

Albay Gov. Joey Salceda, a strong proponent for the privatization of the Albay Electric Cooperative (Aleco), could not be contacted for comment even as consumers and multisectoral stakeholders’ organizations expressed their grave concern and protests, claiming that “we were cheated and fooled by the NEA.”

Salceda was quoted in the past as saying that under SMC, an increase in the power rate was remote until after a reasonable period of time.

On August 21 the troubled Aleco—in debt for close to P4 billion—was finally awarded to SMC, the lone bidder, to be its concessioner for 50 years. Three other bidders—Manila Electric Co., the Lopez Group, and Aboitiz-opted to back out at the last minute during the August  21 scheduled bidding here, saying some of the Terms of Reference were not acceptable.

Under the NEA’s order, Aleco filed a petition with the Energy Regulatory Commission (ERC) for a rate adjustment, a move hidden from the public, said Ephraim de Vera, an official of the Aleco Employees Organization. De Vera quoted NEA-Aleco Project Supervisor Veronica Briones as saying that the petition for rate readjustment was hatched as early as June contrary to its often-reiterated pronouncements during more than a year of deliberation over privatization that a power-rate increase was out of the question.

Aleco’s privatization began in early 2011 after NEA took over its management in February that year in order “to save the cooperative from total collapse.” The privatization move had the blessing of Malacañang through the Department of Energy (DOE). The consumer-owned and -controlled   Aleco board of directors forcibly resigned as a precondition for NEA’s takeover.

Following the resignation of the entire board, the NEA created the Aleco interim board of eight appointed members to formulate the privatization move with Legazpi Diocese Bishop Joel Baylon as chairman.

Businessman Benjamin Santiago was among the interim board appointees who resigned during the middle part of the privatization deliberation, dubbed as Private Sector Participation. The board had rejected suggestions of a rate increase for Aleco. Santiago said the board opposed a rate increase possibly during the first four or five years in an understanding with Briones.

Radio stations had called Briones and the Aleco board members as “demons” after NEA-Aleco filed a petition for a rate increase.

Santiago appealed to the Aleco board and NEA officials to abide by  their “word of honor” and sought consumers’ vigilance now that Aleco is under a concessioner.

Rep. Fernando Gonzalez (Albay, Third District) said he’s not aware about the rate-hike petition. He was among the three Albay lawmakers who joined local government units, the NEA and the DOE in efforts to privatize Aleco, the third biggest cooperative in the country.

According to documents, an alleged public hearing and consultation for the proposed rate increase was conducted on November 28 by the NEA, but was not made known publicly. It was allegedly held at the Aleco office, with only seven consumer-members attending against the 250,000 members.

The documents said a certain Atty. Alfredo Non from the  ERC attended and presided over the public hearing, where he justified that all the prerequisites had been allegedly provided by the NEA to conduct the public hearing.

Legazpi City Mayor Noel Rosal said he was never aware about the proposed rate increase. Rosal was among the major players who pushed for the privatization of Aleco.   source