ZAMBOANGA CITY (Mindanao Examiner / May 7, 2013) – Is the Zamboanga City Electric Cooperative up for privatization? This, after Zamboanga Chamber of Commerce and Industry President Pedro Rufo Soliven was informed of the Zamboanga City Electric Cooperative Board’s approval of its so-called Enhancement program proposed by CONAL Holdings/San Ramon Power Inc.
This was confirmed by Joseph Nocos, Vice President for Business Development of Conal Holdings, and owner of SRPI during a meeting with the business and industrial sectors in Zamboanga City.
The objective of the Enhancement program as proposed by SRPI is to help the local electric cooperative raise its status from Category B to Category A in terms of management and credit worthiness. It said the aim of the program is to bring down the current systems loss of almost 19% and this was the demand of SRPI’s financiers so the cooperative can put its house in order as a guaranty that it is credit worthy and this after SRPI signed the Power Supply Agreement with the local power firm for 85 megawatts for 25 years.
Soliven raised the issue on the timing of the proposed Enhancement program, saying this was submitted after the Power Supply Agreement had already been signed. Soliven said: “It is a situation of putting the cart before the horse. For a P12-billion project, due diligence is a pre-requisite and demanded in assessing the credit worthiness of Zamboanga City Electric Cooperative.”
He said in fairness to SRPI and its declared motive of helping the local cooperative put its house in order by hiring management experts to consult with Zamboanga City Electric Cooperative, “this remains to be seen and SRPI should be given the benefit of the doubt. However, the public should be wary of Greeks bearing gifts. Is there a Trojan horse in the background?”
Soliven said the Enhancement program being proposed by SRPI could be a prelude for a management takeover and eventual privatization of the Zamboanga City Electric Cooperative
While privatization is not entirely a bad proposition, Soliven said “we have to scrutinize the details because one resultant impact will be the higher cost of power for all power consumers. Zamboanga City Electric Cooperative member consumers must be clearly informed of the objectives and rationale of the SRPI proposed enhancement program.”
“In the spirit of transparency and accountability, the member consumers, the true owners of Zamboanga City Electric Cooperative must be given the correct information for their guided decision,” he said.
Soliven said that in a given privatization scenario, with SRPI/Conal Holdings retain control of Zamboanga City Electric Cooperative, “you now have a situation where the supplier of the power is the same entity distributing power in its franchise area, given this situation, What are the check and balance mechanism to be put in place to ensure that no collusion between the distributor and supplier shall occur in this probable scenario?”
Soliven also cited as a clear example of what is happening with the Albay Electric Cooperative which was privatized recently. “There is now wild protest among its member consumers in its franchise area. In the case of Zamboanga City Electric Cooperative, we call on all the power stakeholders to be vigilant and be pro-active on this issue,” he said. (Albert Francisco III)
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