Cheaper electricity from coop conversion?

EDITORIAL

There are conflicting arguments on whether conversion of electric cooperatives from their current non-stock and non-profit status to stock cooperatives could result in cheaper power rates.

According to Ronaldo del Mundo, an electrical engineering professor of the University of the Philippines-National Engineering Center, who recently visited Baguio, even if electric cooperatives are converted, cheaper power rates are not guaranteed.

According to Del Mundo, the Cooperative Development Authority has not come up yet with permanent mechanisms or guidelines on how to handle ECs that register with the agency.

With this, he said converting electric cooperatives and registering as stock cooperatives could open possible monopoly of power distribution in a certain place. This is so, he said, because private distribution utilities will likely take over a mismanaged electric cooperative with high power rates and unstable systems loss.

Del Mundo said in computation of rates, the provision of profit will be included in the determination of the rates to be charged to their consumers, thus, CDA-registered electric cooperatives could have higher power rates considering the patronage refund to be given out to its members.

Other sectors however want power coops to be registered with the CDA so there would be more transparency in its operations particularly its finances. According to them, once the board of directors, general manager and other officials connive in making policies so they could earn from services or contracts, power consumers could be shortchanged.

They say if power firms are registered with the CDA, member consumers would be more vigilant as they would be concerned with their dividends. If the power firm remains with the NEA and considered non-profit, they would always be wondering where money earned from the firms are going. Besides, they argue, the matter of raising or lowering power rates would be decided by them if they opt for the CDA.

On the matter of the taxes now being forcibly charged to electric cooperatives that do not register with CDA and opt to stay with the National Electrification Administration, Del Mundo advised general managers and members of the board of non-stock and non-profit cooperatives to immediately file a petition for rate increase with the Energy Regulatory Commission to include computations for taxes in the rates of consumers that would mean higher power rates in a certain place which will be to the disadvantage of consumers.

Comprehensive discussions on these issues particularly during AGMAs (association general membership assemblies) should be initiated by the board of directors and managers of power firms even if they are aligned with the NEA.

With this, intelligent discussions on issues could be had instead of policies being railroaded by coop officials on power consumers who are not vigilant on how their power cooperative is being run.