Gypped: 250,000 Aleco consumers face electric power rate increase


LEGAZPI CITY — Unknown to the 250,000 power consumers in Albay, the National Electric Administration has filed for a power rate increase in anticipation of the final takeover of the San Miguel Corp. of the operation of its recently acquired bankrupt electric cooperative of the province, according to documents obtained by the PNA.

Albay Gov. Joey Sarte Salceda, who was among the strong and leading proponents for the Albay Electric Cooperative’s privatization, could not be contacted for comment even as consumers and multi-sectoral stakeholders’ organizations expressed their grave concern and protests, claiming “we were cheated and fooled by the NEA.”

Salceda had been quoted in the past that under SMC, an increase in power rate was remote until a reasonable period of time.

On Aug. 21, the troubled Aleco, which is saddled by close to P4 billion debts, was finally awarded to SMC after it won as the lone bidder to be Aleco’s concessionaire for 50 years.

Read related stories, here:”/>Gypped: 250,000 Aleco consumers face electric power rate increaseALECO Consumers Voted for Private Sector Management Instead of Coop to Coop Scheme

Three other bidders – the Manila Electric Corp., Lopez group and Aboitiz — opted to back out at the last minute during the Aug. 21 scheduled bidding here, saying some of the items of the Terms of Reference were not acceptable.

What surprised certain sectors was that Aleco, on NEA’s order, has filed a petition with the Energy Regulatory Commission for an upward rate adjustment, a manipulative move hidden from the noses of the public, said Ephraim De Vera, an official of the Aleco Employees Organization (Aleo).

De Vera quoted NEA-Aleco project supervisor Veronica Briones as saying that the petition for rate readjustment was hatched as early as June, contrary to her often reiterated pronouncements during the more-than-a-year deliberation over the privatization move that power rate increase was out of the issue.

According to documents, an alleged public hearing and consultation for the proposed rate increase was conducted by the NEA but hidden from the public last Nov. 28 at the Aleco office with only seven consumer-members attending against the 250,000 members.

The documents said a certain Atty. Alfredo Non from the ERC attended and presided over the farce public hearing where he announced and justified that all the pre-requisites had been allegedly provided by NEA to conduct the public hearing.

On Dec. 2, Aleo, through its appointed representative and counsel, lawyer Richie Regala, filed a petition to intervene in the matter of the application for approval in the adjustment in rates pursuant to the Tariff Glide Path (TGP) rules with prayer for provisional authority as filed by Aleco under ERC case No. 2013-170 RC.

The Aleo petition said Aleco can only apply for power rate adjustment under the TGP if it is for reduction of rate but not to increase.

It said that Aleco had entered into an agreement with a concessionaire, boasting of a “no rate increase promise to be implemented during a reasonable period of time.”

A week before the scheduled referendum on Sept. 14, Salceda said that should the privatization be realized, SMC will assume Aleco operation and control in 24 hours.

Documents, however, showed SMC will assume over Aleco management and control on January 24, 2014.

Asked why SMC has yet to takeover full operational and management control as a concessionaire, De Vera said one fact being considered is to have the applied rate increase first realized as the hidden pre-condition between NEA and SMC.

Aleco’s de facto privatization began in early 2011 after NEA took over its management control in February that year on the pretext of saving the cooperative from total collapse.

The privatization move had the blessings of the Department of Energy while Salceda had his own-controlled consumers-elected Aleco board of directors forcibly resigned as a pre-condition to the NEA takeover.

Following the resignation of the entire members of the board, NEA created the Aleco interim board of eight appointed members to formulate the privatization move, with Legazpi Diocese Bishop Joel Baylon as chairman.

According to businessman Benjamin Santiago, who was among interim board members but who resigned during the mid-part of the deliberation for privatization dubbed as Private Sector Participation (PSP), the feared rate increase was openly raised by consumers.

They, however, got a big “no” for an answer and the issue had been avoided by the board so as not to provoke possible unrest and continuing resistance from consumers and the opposing group.

Santiago appealed to the Aleco board and NEA officials to keep their word of honor and sought consumers’ vigilance now that Aleco is under a concessionaire.

Rep. Fernando Gonzalez (Albay, 3rd district) said he is not aware of the rate hike petition.

Gonzalez was among the three Albay lawmakers who joined the efforts to privatize Aleco, the third biggest cooperative and among the 10 worse for alleged graft and corruption.

Mayor Noel Rosal of Legazpi cried foul, saying he was never aware of the proposed rate increase.

Rosal was among the major players who pushed for the Aleco privatization. (PNA report by Manilyn Ugalde)


2 thoughts on “Gypped: 250,000 Aleco consumers face electric power rate increase”

  1. What a sweet prospect for a Christmas gift to all the power consumers of Aleco in Albay province. If proven true, correct, approved and made effective, can we ask for more clarification, that big networked corporations are out there to do just what they are expected to do. Keep their cash registers ringing, and their bank accounts full.

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