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NEA to coops: Bring power rates down

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TAGUM CITY, Davao del Norte—The National Electrification Administration (NEA), representatives of the electric cooperatives (EC), and leaders of power consumer alliances nationwide pledged on Friday (April 28) to keep promoting sustainable development in the rural areas through countryside energization.
Latest data from the NEA Corporate Planning Office showed that 77 out of the 99 on-grid ECs and 16 out of the 20 island or off-grid coops managed to sell power under P10 per kilowatt hour (kWh) to each household last year.
Leading these rural energy distribution companies is Beneco whose unbundled power rate averaged only P5.45 in 2016, excluding value-added taxes (VAT), which caught the attention of Administrator Edgardo Masongsong.
At the NEA-EC Consultative Conference held in Davao del Norte last week, Masongsong urged power coops imposing higher electricity rates to be on par with Beneco as much as possible following the directive of President Rodrigo Duterte.
“I challenge the other electric cooperatives to review your power rate, to reduce your power rate because that is the call of the president. That, at the end of his term, dapat mura ang kuryente,” Masongsong said.
Beneco General Manager (GM) Gerardo Verzosa, in a recent interview with Davao-based media, said all the compliments about their cheap electricity rates especially coming from the NEA and other industry players are highly appreciated.
Asked on how they are doing it, Verzosa, who was named the Best GM in Luzon, told reporters it all boils down to securing a flexible bilateral contract with their supplier, Team Energy, which operates a 1,200 megawatt coal-fired station in Sual, Pangasinan.
Verzosa added they are also buying power from the Wholesale Electricity Spot Market (WESM) but this is a riskier move given its volatility due to the current policies set by the Energy Regulatory Commission (ERC).
“The WESM the prices vary every hour. There were times in the past na tumatama ang aming forecast, there were times also (na hindi), but on the average mura,” he explained. Verzosa, nonetheless, admitted that keeping power rates low is a constant challenge on their part.
“The power industry is not easy to understand, especially from the point of view of the housewife, who is responsible for the purse of the household. Ang gusto niya is stable para ma-budget niya ba,” he said.
This is why they keep updating their forecast based on the historical cost of all the utilities and are not relying on a single source. Right now, Verzosa is pleased Beneco offers a steady power rate, which is relatively way cheaper than what for-profit companies will normally give.
Echoing the NEA chief, Verzosa said other ECs can also lower their electricity rates to ease the burden on their customers. “Consistently, modesty aside, we've always been hitting our consumers with cheaper rate in terms of power cost compared to any private utility.”
“We would like to believe that we have been providing more value to our consumers for every peso they spent to buy power from Beneco… We share the view that the electric cooperatives right now are able to provide cheaper cost of service compared to the private utilities,” he said.###