Electric co-ops urged to help bring down electricity rates

Cooperative Development Authority (CDA)-registered electric cooperatives are egging other utilities to follow their lead in shunning government control to bring down electricity rates.

In a press conference, Ponciano Payuyo, Association of Philippine Electric Cooperative (APEC) party-list representative, said that electric cooperatives should sign up under the CDA to avail of tax incentives from the government.

”There is a new law [Republic Act] 9520 that encourages all the electric cooperatives in the country to register with the CDA and enjoy all the privileges of any other cooperative registered [such as] exemption from all form of taxes -both national and local,” he said.

Under the said law, or the New Cooperative Code of the Philippines signed by President Gloria Arroyo in February last year, electric cooperatives registered under the CDA, which is on a voluntary basis, will enjoy tax exemptions and government funding support.

In turn, they will be cut off from National Electrification Administration’s (NEA) supervision. The latter is the state-run agency for rural electrification that provides financial, institutional and technical services to the utilities. It also screens and approves personnel changes in electric cooperatives’ management.

Payuyo said that removing electric cooperatives from NEA’s watch would allow the government to channel its funds to other priority projects while forcing them to operate “responsibly” as they would be held directly liable by their member-consumers.

”We would be more competitive if we are consumer-based,” he said.

But he said that this early on, consumers served by CDA-registered electric cooperatives will enjoy as much as P0.25 a kilowatt-hour to P0.40 a kilowatt-hour reduction in their rates because of the tax perks.
However, only 11 out of the 119 electric cooperatives across the country have signed with the CDA.

Luis Manuel Corral, APEC secretary general, said that the cold reception electric cooperatives have greeted the CDA was the result of “intimidation, misinformation and “miseducation” of electric cooperatives, with NEA allegedly at the forefront, warning that once they sign up, they will no longer be allowed to borrow funds from the agency.

Among the Electronic Cooperatives that signed up for CDA are Negros Occidental Electric Cooperatives; Palawan Electric Cooeprative; Pangasinan Electric Cooperative 1 and 2; Nueva Vizcaya Electric Cooperative; Negro Oriental Electric Cooperative; Abra Electric Cooeprative, Isabela Electric Cooperative; Sorsogon Electric Cooperative and Quirino Electric Cooperative.

Judith Alferez, NEA public affairs office head, said that NEA is not blocking electric cooperatives who want to register with the CDA.

However, she said that NEA does not extend financial assistance to CDA members since it does not have oversight over these utilities. –Euan Paulo C. Añonuevo Reporter, Manila Times