With many of the country’s electric cooperatives (ECs) still getting back on their feet following last year’s wallop of disasters and most still prepping for recovery from the health crisis, the National Electrification Administration (NEA) reported that loan portfolios extended to these rural power utilities reached P102 million within first quarter this year.
The government-run agency’s Accounts Management and Guarantee Department (AMGD) stated that a significant portion of the ECs’ borrowings had been for calamity loans – primarily those that have been pummeled by the series of strong typhoons in the latter part of 2020.
“From January to March this year, P102.4 million in loans – including calamity loans, were released to five electric cooperatives,” NEA emphasized.
The electrification agency said it extended P42.9 million worth of calamity loans to Camarines Sur III Electric Cooperative Inc. (CASURECO III); Marinduque Electric Cooperative Inc. (MARELCO); Oriental Mindoro Electric Cooperative Inc. (ORMECO); and Quezon I Electric Cooperative Inc. (QUEZELCO I).
It is worth noting that the electric cooperatives in the Bicol region, as well as those in Quezon and Oriential Mindoro had been among those forcefully barreled by successive typhoons that hit the country within October-November last year.
Apart from calamity loans, the lion’s share of credit facility funneled to the ECs in the initial three months this year had been for their capital expenditure (capex) projects and working capital requirements.
NEA shared that it released P59.5 million loans to Davao del Norte Electric Cooperative Inc. (DANECO) as well as CASURECO III, on specified capex projects and working capital fund utilization across facets of their operations.
Essentially, NEA indicated that such scale of loans still accounted for a marginal fraction of the programmed P500 million credit window earmarked for the ECs – primarily for their funding requirements in implementing various rural electrification projects. That amount excludes yet allocations for calamity loans.
As explained by NEA Administrator Edgardo R. Masongsong, “under the NEA lending and guarantee program, our ECs may avail of the needed financial assistance for their electrification projects to improve the operational efficiencies and delivery of electric services to their consumers.”
For the calamity loans, in particular, it was noted that funding could be availed of by the ECs “for the repair and rehabilitation of their respective power distribution systems and other facilities that were damaged,” – primarily by typhoons Quinta, Rolly and Ulysses last year.
The calamity loan being offered by the agency has a maximum 10-year repayment term; plus a one-year grace period. Interest rate is set at 3.25-percent per annum.