How CENECO And Its Consumers Would Benefit From The Primelectric & CENECO Joint Venture Agreement

Bacolod City’s frequent power interruptions have been a usual occurrence these past years and have continuously made many consumers, including entrepreneurs, worried about their future. The electricity service provided by Central Negros Electric Cooperative, Inc. (CENECO) these past decades has been less than satisfactory, and the Primelectric and CENECO Joint Venture Agreement (JVA) is evidently the most plausible answer to the continuing problem.

Once this JVA comes into fruition, the service will certainly improve, and the cost of electricity will be reduced significantly. Other benefits will follow suit.

Consumer Complaints About CENECO

CENECO has served Bacolod for many decades, but its services have increasingly deteriorated over the years. The following are among the problems that consumers have experienced with CENECO:

• Frequent brownouts
• Receiving low voltage electricity
• Exploding transformers and power poles catching fire
• Next day restoration of electricity
• Leaning/tilting and almost falling electric poles
• Tampered with or covered electric meters (makes you wonder how the meter reading was done)
• Sudden and notable increase in electricity bill
• Immediate payment of bill and if you’re unable to pay, electricity will be disconnected or subjected to the one bill policy
• Unanswered phone calls from consumers
• Application for new connections takes a long time because they don’t have an available transformer or electric meter

Possible Reasons Why the Energy Regulatory Commission (ERC) Has Not Approved CENECO’s Loan Application

CENECO has been trying to borrow an additional Php 1.3 billion from ERC since 2011 as capital for the rehabilitation and upgrading of its facilities. However, this hasn’t been approved because of the following:

• Opposition from different groups in the area.
• CENECO’s CapEx application isn’t considered an emergency.
• There’s a continuing CapEx charge of 15 centavos on consumers by CENECO amounting to Php 90 million per year that’s not being used properly. CENECO would have to incur more debt to pass the payment burden to consumers again.

Possible Reasons Behind CENECO’s Bad Service, Plus Their Debts

• Due to the lack of sufficient funds, CENECO’s facilities have deteriorated and have not been repaired and/or replaced and without additional capacity added to the substations.
• CENECO is now categorized as Single A by NEA, down from Triple A in 2021. It continues to decrease and probably won’t recover before 2030 when its franchise ends.
• The system loss has reached almost 11%, which is beyond the allowable cap of ERC’s 8.25%, causing a loss of nearly Php 20 million per month.
• The accumulated losses due to system loss for CENECO have surpassed Php 60 million from January to June 2023. This doesn’t even include their payments for penalties from 2022.
• As of June 2023, CENECO’s debt has reached Php 613,124,390.81.

CENECO’s Other Debts

• Restricted Funds have already been used.
• The Bill Deposit, which should have been returned after 3 years to consumers, has already been used. This amounts to Php 277,489,144.98. A refund is no longer possible since they wouldn’t be able to pay.
• The Retirement Fund of the employees amounting to Php 37,708,449.91.
• The Bond from Kepco-SalCon Power Corporation, a supplier worth Php 54,000,000.00.

Solution to CENECO’s Problems

Because they lack ERC approval, CENECO is unable to secure a loan from any bank. Furthermore, CENECO’s franchise will expire by 2030 and if they’re granted a loan now, the consumers will shoulder the burden, resulting in an increase of electricity charges.

The solution to CENECO’s woes is the Primelectric and CENECO Joint Venture Agreement. Primelectric is offering CENECO Php 1.7 billion to help pay for its borrowed funds, which includes the Bill Deposit fund. If the JVA happens, the consumers can get their Bill Deposits.

Consequences of the Primelectric and CENECO JVA

• No increase in consumer’s rate for the distribution system and metering charge which will remain at Php 1.18 per kilowatt hour.
• Primelectric (Negros Power) will be responsible for the expenses of renovating and modernizing facilities.
• The consumers will largely benefit from the JVA.
• CENECO will exist for another 25 years through a new franchise granted to Negros Power by Congress. CENECO will retain 30% ownership share.

Vote YES to JVA

There’s no reason for consumers to not support the CENECO and Primelectric JVA. Let us participate in the plebiscite. A majority must VOTE YES for the JVA to push through.

⯈ Plebiscite Dates: August 19, 20, 26, and 27. September 02 and 03, 2023.

⯈ Plebiscite Locations: At the schools identified by CENECO (check the list below).

You can appoint a proxy to vote on your behalf if you’re in favor of the JVA but can’t vote on the plebiscite days.

Fill up a proxy form at the CENECO JVA booths located at:

• SM City Bacolod
• Ayala Malls Capitol Central
• Robinsons Place Bacolod
• CityMall
• Gaisano Mall
• 888 Chinatown Premier Mall
• Bacolod Old City Hall
• Bacolod New Government Center

Voting Centers and Precincts

Here are the list of voting centers and precincts for the conduct of plebiscite for the Joint Venture Agreement (JVA) between Primelectric and CENECO: