More than two months after the National Electrification Administration (NEA) exercised its step-in rights over Abra Electric Cooperative (Abreco), the ailing power distribution utility has undergone many significant changes to enhance its operational efficiency.
Abreco Acting General Manager Charito Mabitazan recently submitted a report detailing the accomplishments and reforms the Task Force Duterte Abra Power and the NEA management team have made during the first two months of their rehabilitation efforts.
Mabitazan said Abreco's power bills to Philippine Electricity Market Corporation (PEMC) and National Grid Corporation of the Philippines (NGCP) amounting to P27.5 million and P7.6 million, respectively, for the month of March were already paid.
The official explained that the P7-million increase in power bills was due to hike in WESM (wholesale electricity spot market) rate.
During their Board meeting on April 23, NEA Deputy Administrator Atty. Goldelio Rivera, who is also the chairman of the Task Force, said various reforms were discussed including improvement of the billing and collection system, and procurement of power supply under a bilateral contract with a power supplier or under an aggregation with other electric cooperatives.
The new management also instituted financial, institutional and technical reforms, such as organizational downsizing, implementation of an effective collection strategy, creation of the Multi-Sectoral Electrification Advisory Council (MSEAC) in nine districts of Abreco, formulation of a 100-Day Strategic Development Plan, and submission of a proposed organizational structure of the co-op.
"Once everything is in place, we will recommend for the conduct of district elections and turn over the management and operations to Abrenians, who are the true owners of Abreco," Deputy Administrator Rivera said.
On February 9, the NEA was constrained to take over the operations and management of Abreco due to significant adverse audit findings, and notices of default and suspension issued by PEMC which stemmed from the co-op's non-payment of power bills amounting to over P200 million.
Among the adverse audit findings were overcharging of generation rates amounting to P128 million from July 2015 to October 2016 alone; non-submission of pertinent documents on the utilization of subsidy funds; non-observance of procurement procedures; questionable transactions including the reconditioning, testing and commissioning of 5MVA Substation; purchases from favored suppliers; irregular disbursements for EC vehicles; irregular payments of benefits, per diems and allowances; and borrowing money from various resources at usurious interest rates ranging from 6 percent to 8 percent a month.
To recall, NEA Administrator Edgardo Masongsong issued Office Order No. 2017-168 in September last year creating the Task Force Duterte Abra Power to rehabilitate Abreco. The order was pursuant to Section 5 (a) Chapter II and Sections 4-A and B of Presidential Decree No. 269, as amended by Republic Act No. 10531. NEA