May 23, 2019 | 9:55 pm
THE NATIONAL
Electrification Administration (NEA) has proposed changes to the way it
evaluates the performance of electric cooperatives by including their
energization level among the parameters, the agency said on Thursday.
In a statement, NEA
Director Ana Rosa D. Papa announced the proposal, which will measure the number
of consumer connections a power electric cooperative achieves under a given
timeline.
The data will be based
on the official reports and documents a cooperative submits through the NEA
business intelligence technology web portal.
Under its existing
system, NEA evaluates and determines the overall performance of power
distribution utilities annually using two criteria: key performance standards
(KPS), which account for 80%; and the cooperatives’ classification, which makes
up 20%.
Ms. Papa, who heads
NEA’s office for performance assessment and special studies, said the set of
criteria is designed to measure power co-ops’ financial, institutional and
technical performance, as well as “to promote accountability and responsibility
in their compliances and fiduciary obligations.”
The agency has
solicited comment from stakeholders on the proposed changes to the performance
assessment guidelines before submission to the NEA board of administrators for
approval.
Once approved and
published in a newspaper of general circulation, the agency will implement the
revised policy guidelines starting next year. The new measure will serve as
basis for coming up with the performance incentive mechanisms for cooperatives.
“The mandatory
assessment on the performance of non-profit distribution utilities in the
country started way back in 1982 to keep track of the viability of their
operations economically and financially. Since then, the rules and guidelines
have evolved and changed significantly,” NEA said.
“From 1982 to 1993, the
state-run agency based the parameters on what was stipulated under Presidential
Decree No. 269, otherwise known as the ‘National Electrification Administration
Decree,’ in which power distribution utilities were categorized into four
letter grades — A to D,” it added.
From 1994 to 2011, the
categories were expanded to six — A+, A, B, C, D and E. This was also during
the passage of Republic Act No. 9136 or the Electric Power Industry Reform Act
(EPIRA) of 2001.
In 2012, NEA introduced
its KPS, which covered financial, institutional, technical and reportorial
compliance of the co-ops as part of the overall evaluation of their operational
performance.
From 2013 to 2017, the
agency revised its rules and guidelines based on the provisions of RA 10531 or
the NEA Reform Act of 2013, which called for it to develop financial and
operational parameters to serve as the basis for its intervention.
The revision includes
the co-ops’ classification, which covered seven financially driven standards
and parameters such as accounts payable to the National Grid Corporation of the
Philippines, the system operator.
Under the current
policy guidelines, the power utilities are rated from AAA as the highest to D
as the lowest. — Victor V. Saulon
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