Government-run National Electrification Administration (NEA) is offering at least P50-million emergency loan to Occidental Mindoro Electric Cooperative Inc. (OMECO) so it can avert blackouts that could torment consumers being served by the power utility.
According to NEA, its loan offer could be taken as a “short-term solution to the power supply problem” that has been distressing end-users in Occidental Mindoro.
Many electric cooperatives, including OMECO, are currently being tortured by predicaments of power interruptions – and this was in part due to deficient financial resources that their power suppliers could utilize for fuel procurements so they can continually serve the electricity needs of consumers in their service areas.
NEA said it could extend the credit facility to the Mindoro power utility, which in turn could be utilized for its settlement of dues to its lone power provider Occidental Mindoro Consolidated Power Corporation (OMCPC).
As emphasized by NEA Administrator Emmanuel P. Juaneza, “the P50 million will be used for fuel procurement of OMCPC.”
Nevertheless, the electrification agency conveyed that the board of directors of OMECO had released a resolution “opposing the availment of the loan,” as they reportedly opined that “it is the responsibility of OMCPC to buy fuel.”
Given such turn of events then, Juaneza noted that “NEA is currently reviewing the action of the board.”
To recall, the Energy Regulatory Commission (ERC) had previously penalized OMECO, hence, the power utility was directed to shoulder 50-percent of the universal charge for missionary electrification subsidy to OMCPC and that was “due to the delayed implementation of its Competitive Selection Process (CSP).”
The CSP is a bidding exercise enforced upon power utilities, like OMECO, for them to select their power suppliers on a ‘least cost basis’ – and that shall be reckoned on the price tenders submitted during the auction process.
But as sounded off by Atty Nelson Evangelista, legal counsel of the electric cooperative, “the delay in the CSP was not OMECO’s fault,” with him stressing that “the delay was justified due to supervening events or extraordinary circumstances,” primarily relating to the Covid-19 pandemic.
The ERC, for its part, has committed to review the penalty enforced on OMECO; while also allowing state-run National Power Corporation (NPC) to temporarily operate a 10-megawatt genset which is sited in the Occidental Mindoro power utility’s jurisdiction.
Beyond the proposed short-term solutions, it was similarly prescribed that the next steps to be taken as medium-term fix would be for NEA and OMECO to “look for potential suppliers to fill in gaps in power supply deficiency while the commercial operation of the automated economic scheduling and dispatching of power plants is eyed next year.”