NEA appoints new board for ZAMCELCO

Published October 4, 2019, 12:00 AM

by manilabulletin_admin

By Myrna M. Velasco

Government-run National Electrification Administration (NEA) has appointed new set of board of directors for embattled Zamboanga City Electric Cooperative (ZAMCELCO), citing the power utility’s “deteriorating financial condition” as the major ground for such action.

The agency said the decision to disband the previous ZAMCELCO board was decided through Resolution No. 113 that was approved by NEA’s own board last month, invoking its supervisory powers over the electric cooperative (EC) as prescribed under Section 4-A of Republic Act 10531 or the NEA Charter.

NEA Deputy Administrator for Legal Services Rossan Rosero-Lee indicated that as a remedial measure due to ZAMCELCO’s “extraordinary state,” the agency resorted to the formation of the Task Force Duterte-Zamboanga City Power (TFD-ZCP) to also act as the board for the electric cooperative.

The electrification agency explained that “an election for the regular members of the ZAMCELCO board cannot be conducted as the administrative cases are still pending with the NEA administrative committee.”

Lee expounded that the NEA had been vested with the authority to “appoint or assign third persons to the Board of the EC until the NEA decides that the election of the board of directors to manage the EC is necessary and it can create a management team for the purpose.”

Early part of the year, ZAMCELCO had been thrown into the spotlight following electricity service disruptions pestering Zamboanga City residents – triggered mainly by the dispute between power supplier Western Mindanao Power Corporation (WMPC) to the electric cooperative and its investor-management contractor (IMC), which is the joint venture of Crowninvestment Holdings, Inc. and Desco, Inc.

With an intervention from the Energy Regulatory Commission, the parties had since then entered into “interim compromise agreements” so the people of Zamboanga City could be continually served with their power needs.

Just in July this year, WMPC and the Crown-Desco IMC sealed their second compromise deal warranting the latter to pay additional P150 million to its Alcantara-owned power firm supplier for ZAMCELCO.

Despite the two-time payments to WMPC that already totaled P370 million, Crown-Desco also stood pat on the P441-million “overbilling” that it lodged last February against power supplier-firm WMPC. The overbillings, it said, accrued for the periods from 2015 to 2018.

WMPC previously indicated that it demanded payments from Crown-Desco as ZAMCELCO’s investor-manager because it will need such for procurement of fuel so it can continually supply power to the Zamboanga electric cooperative.
Conversely in April this year, Crown-ZAMCELCO filed a motion with the ERC “for a claim for refund of its overpayments.”

The motion filed with the regulatory body similarly prayed “for its withdrawal from and the ERC’s dismissal of the application for approval of ZAMCELCO’s power supply agreement with WMPC.”

WMPC noted though that it has been supplying the Zamboanga power utility with its electricity needs on the strength of a provisionally approved PSA rendered by the ERC itself way back in 2015.