SAY YES TO BETTER ELECTRICAL SERVICE

Power interruption, power outage, electricity fault, they all mean the same thing to consumers – Brownout!  In some areas, there are concerns about leaning posts and hanging electric wires that are left unattended. But we still get the same high electricity bill monthly?

Well, when this happens, Ceneco- the power distributor in Bacolod City and in some areas in Negros Occidental gets all the bashing.

Why does this happen? Because consumers feel that they don’t get their money’s worth.

People have been wanting change for some time because  they feel the need to have all these things addressed.

For Bacolodnons, we are only familiar with Ceneco (Central Negros Electric Cooperative), a SEC registered electric cooperative company that has been operating for the last 30 years. Despite all the complains we hear about its services, we just manage to bear with them in the hope that one day something good will happen.

 

WHAT CENECO NEEDS

For someone or something that has aged, assistance is of utmost priority. That’s how Ceneco looks like in a picture, a 30 year old  company that needs assistance. Unscheduled brownouts are experienced because its facilities are already old and have not been upgraded to meet the electricity demands of its rapidly growing number of consumers.

Ceneco has a debt of more than 600 million pesos from banks and other internal borrowings.

The Energy Regulatory Commission (ERC) has not approved the application for capital expenditures (CAPEX) since 2011.

The monthly system loss of 11.5% is way above the allowed cap of ERC which is at 8.25% which means a loss of 20 million pesos per month.  It’s franchise will also expire in 2030 and a new application has to be filed in Congress.

WHO IS PRIMELECTRIC/NEPC (Negros Power)?

PrimElectric Holdings Inc is a subsidiary of More Electric Power Corporation that operates as the electricity distribution utility in Iloilo City.

It is owned by business tycoon Mr. Enrique Razon.

The President of MORE, Mr. Roel Castro, is also concurrent President and CEO of PrimElectric/Negros Power.

 

MORE started its operation in Iloilo in 2020 and since then has proven a track record in modernizing Iloilo’s power distribution system.  They spent 2 billion pesos in 3 years and allocated another 1 billion for the next 2 years.

They were able to increase the capacity of their substations, built new substations and purchased 2 mobile substations.  With these investments, system loss was decreased from 30% to 5.5% and unscheduled power interruptions were reduced. Costumer service response was also improved and strict procurement processes were followed leading to the reduction of average rates.

MORE is also active in Corporate Social Responsibility (CSR)and has partnered with barangay, community and local government projects in Iloilo City.

 

JOINT VENTURE AGREEMENT- WHAT WILL HAPPEN IF JVA WILL BE APPROVED

Primelectric-Negros Power has signed a JVA (Joint Venture Agreement) with Ceneco which aims to bring hope to a brown out stricken city.   If the joint venture will push through –

• PrimElectric/(NEPC Negros Power) will provide 7 billion pesos in cash as payment for 70% of the value of CENECO’s  distribution assets. If this happens, CENECO can pay all its debts, return bill deposits to consumers and will be able to give retirement and separation to its employees.
• The remaining money can be returned to their members-consumers as patronage refunds.
• The Joint Venture Company will apply to Congress for a new franchise for the next 25 years,
• Also, qualified CENECO employees will be given priority to work in the new Joint Venture Company.
• An initial immediate investment of 2 billion will be made by PrimElectric/(NEPC Negros Power) for it’s CapEx Fund to jumpstart the modernization, rehabilitation and upgrading of the distribution facilities.

Furthermore, the JVA does not mean that CENECO is being privatized or sold. Because Ceneco, as many Negrenses know, has always been  private, since 1975.

What PrimElectric is buying is Ceneco’s distribution assets so that they will have authority in implementing the needed improvements on the facilities.

In the JVA, nothing will change in its juridical identity.

Ceneco will remain as it is and will continue to own 30% of the distribution utility company, Negros Electric and Power Corp. or NEPC. This means, that when the dividends of Primelectric, NEPC and CENECO are divided, 30% will go to CENECO and they will be able to give dividends to their member-consumer-owners.

 

WHAT HAPPENS TO THE PRICE OF ELECTRICITY

This is the most frequently asked question especially when people hear about the JVA.

According to Primelectric/Negros Power, electricity will get cheaper!

Why?  Despite the 1.7 billion pesos that PrimElectric will give to Ceneco, there will be no increase in Ceneco’s distribution charge of 1 peso and 18 centavos.

However, there will be a decrease in the system loss that is passed on to us as consumers.

From 8.25 % for Ceneco, it will become 5.5% which means a decrease  of 2.75% in the system loss that we  will pay. So, there will be no  increase but a decrease in power rates in the JVA.

In fact, their sister company MORE Power in Iloilo City has the lowest rates right now compared to the electric coops in Western Visayas.

Their rate P11.65/KwH while CENECO’s is  P12.78/KwH.

Another factor that will contribute to the lowering of the rate is the VAT.  NEPC, like CENECO, will still be required by the BIR to pay VAT.  However, the rate will be lower because most of the electricity will come from Renewable Energy which is VAT exempt.

 

WHAT MORE TO EXPECT FROM THE JVCOMPANY

Competitive Selection Process – The Joint Venture Company that will be established will get new power suppliers that will go through a competitive selection process by proper bidding and negotiation.  The one that can offer the best quality with the lowest price will win.

24/7 Help Line – Most of the complaints from consumers about Ceneco are unattended hot lines and delayed response. With the JV Company, they assure the consumers of a friendly consumer service and a quick response team to answer calls at any time.

Less Brownout -Of course no one likes brownouts, especially  unscheduled ones. So here’s the good news! In giving priority to modernization, upgrade and change in facilities, brownouts will decrease in no time.

Corporate Social Responsibility – The JV company will be active in CSR through partnerships in community, barangay and local government unit projects here in Bacolod.

The Barangay Electrification Program will continue.

This is funded by our National Government and not by Ceneco.  So, the allocation of funds by the National Government will not stop and the JV Company NEPC will implement it.

If Primelectric /NEPC and Ceneco’s partnership will push through, more businesses and tourists will enter the province. This also means, having more jobs for Negrenses and taxes for the government.

So, with the support of the consumers for the JVA between CENECO and Primelectric, definitely it is their welfare that will be the company’s utmost concern.

Low electricity and improved service are Primelectric’s main goals as they work hand in hand with Ceneco.