CENECO asked to update council on P1.4-B loan

BACOLOD City – Bacolod City Councilor Wilson Gamboa Jr. asked the Central Negros Electric Cooperative Inc. (CENECO) to update the Sangguniang Panlungsod (SP) on the utility firm’s proposed P1.4-billion loan.

Last Aug 29, 2018, the SP approved a resolution authored by Gamboa, which urges Sulpicio Lagarde Jr., CENECO general manager, to apprise the SP on the P1.4-billion loan to cover CENECO’s multi-year capital expenditure (CapEx) program.

Gamboa said the Energy Regulatory Commission (ERC) conducted a hearing last Aug 16 at the CENECO compound relative to the loan in order for CENECO to present evidence and requirement compliance.

CENECO’s CapEx program covers 29 projects, a portion of which had already been implemented but needs expansion owing to rising power demands.

CENECO presently intends to construct the Murcia substation, Alijis substation, and the new Capitol substation thus, it decided to borrow P1.4 billion.

But Gamboa explained that under ERC’s requirements, CENECO has the obligation to present to the SP the details of the loan, not only for social acceptability but also with regards to environmental impact and most of all.

CENECO also has to give details on the pass-on cost of the loan to consumers.

Gamboa’s resolution cited that while the Electric Power Industry Reform Act (EPIRA) mandates that the loan estimated can be used as capital expenditures by CENECO, it can likewise be “passed on,” giving the power consumers more financial burden.

The EPIRA law provided in the second paragraph of Section 36 that all distribution utilities must unbundle the cost of electricity rates and the rates of delivering the services to customers.

Gamboa said that while the Bacolod Local Government Unit (LGU) supports CENECO’s CapEx program loan to finance its expansion and upgrading of facilities in response to the increase of power requirements of its franchise area, the public should know details of said loan as the “electric power industry is impressed with public interest as a basic need for economic momentum.”

He also reminded CENECO to submit to the SP their Board Resolutions and management proposals relative all power contracts, which were subject of previous hearings.

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