City gov’t, Beneco agree to solve Asin power plants tiff

By Isagani S. Liporada

BAGUIO CITY – A solution to the dispute over a paperless deal Benguet Electric Coop. has with the Baguio government may soon be solved with both parties agreeing to create a joint technical team to audit Beneco power purchase from city operations of the Asin mini-hydroelectric plants.

Mayor Mauricio Domogan earlier opined the deduction of 18-percent systems loss in the payment of purchased power by Beneco to the local government.

During the executive-legislative meeting at city hall Sept. 6, he said some adjustments could be made in the billing computations in favor of the city government. “Even the Electric Power Industry Reform Act (EPIRA) provides ceiling in the deduction of systems loss at a much lower percentage.”

“I don’t understand why Beneco even deducts as much as 18-percent which could translate to bigger income for the city when it is merely a buyer of the power we produce.”

Beneco and the city government, without written agreement agreed to an electric power exchange rate using National Power Corp. standard power tariff at P4.80 per KWH sometime in 2007.

“But records show us otherwise,” Domogan claimed adding, “I don’t see Beneco using NPC rates as basis of their computations.”

“More,” he added, “why are we paying job order employees so much, it eats up a substantial chunk of what the city is getting from the AMP?”

He demanded to know “who authorized the deals,” apparently suspecting the city was short-changed somewhere.

Records show, pursuant to Resolution 234-2006, the city government took over operations of American vintage AMP from the Aboitiz-led Hydro Electric Development Corporation, Inc. (Hedcor) in December 26, 2006.

Beneco board director Benny Bomogao who observed the turnover welcomed the development saying, “the city stands to gain close to P775-million per annum from the hydro plants’ operations. “Beneco agreed to buy the power produce from the city government at NPC rate.”

Then councilor Rocky Balisong who rallied for the takeover in the council for his part then said, “The city is sure to rake in more for its coffers since there is no three-way division of profits and electric power as compared to the previous agreements [with Baguio Water District (BWD) and Hedcor.]”

BWD was awarded management and operations of the plants in September 1981.

In 1985, it commissioned Davao Light and Power Corporation, and subsequently Hedcor in 1992 to operate the mini hydros, admitting it did not have the expertise to go it alone.

Balisong, former chair of the City Council Public Utilities, Transportation and Traffic Committee authored Resolution 258-06 that triggered city-led operations of the AMP.

Under Resolution 258, the council authorized then mayor Reinaldo Bautista, Jr. to negotiate with Hedcor and Beneco, among others, in the operations of the AMP.

The same measure likewise authorized Bautista to hire qualified personnel on job contract basis.

With nobody else on sight to operate the AMP, the city took in former Hedcor employees assigned in the AMP, whose salaries range from P10-thousand to P15-thousand excluding overtime pay and other benefits.

The council for its part passed Ordinance 20-2007 creating a trust fund from where said employees can draw their pay, among other needed expenditures to maintain the AMP.

Meanwhile, city councilor Peter Fianza who was then city administrator said Beneco came up with a proposal regarding the purchase of power. “The city however, did not respond to their calls to finalize the same.”

“In fairness to Beneco, Versoza always maintained that if any errors were committed on their end, they will be willing to sit down with the city government to correct the same.