By Dolly Yasa
BACOLOD City – The proposed Joint Venture Agreement (JVA) between Central Negros Electric Cooperative (Ceneco) and Ignite Power will boost the “bleeding” cooperative, according to its acting general manager, Atty. Arnel Lapore because.
Lapore told Daily Guardian on Friday that “I think it (JVA) will give fresh life to Ceneco.”
Lapore said Ignite Power made a presentation of the JVA details on Thursday, April 13, 2023.
He said it was attended by all members of the board, the two union presidents, the department managers, the commission of managers, area managers, National Electrification Administration (NEA) project supervisor Atty. Vic Alvaro and Atty. Ivan Zamora from the office of NEA Administrator Antonio Mariano Almeda.
The presentation was made by Ignite Power president Roel V. Castro, who is also the president and COO of MORE Power in Iloilo City.
“To sum, it all both parties will undergo due diligence as far as the details of the JVA is concerned. We will be securing documents from them and they will be securing documents from us, particularly financial data which is needed to formulate the content of the JVA,” Lapore said.
He added that they have to ascertain the respective shares of Ceneco and Ignite Power in case the JVA pushes through.
Lapore said an ad hoc committee was created to study and handle the due diligence undertaking.
They will reconvene after 14 days, he said.
Lapore also clarified the fare of Ceneco employees if the JVA pushes through. He explained that the employees will be accordingly paid of their separation or retirement benefits with the assurance of preferential hiring and will be given top priority for those who are willing to apply in the joint venture company.
Personally, Lapore said the JVA is a good thing.
“Let us be open about it, we have this option, the possibility of infusing capital that will improve and develop our distribution utility,” he said.
“Ceneco is losing P15 to 20 million a month due to the subsidy to the systems loss. We can’t afford to continue bleeding until we can no longer pay our power suppliers. The systems loss is eating up our resources,” he further said.
Systems loss refers to electricity lost to technical reasons and pilferage. The systems loss cap for electric cooperatives is 14 percent, which means it can charge that level of loss to consumers. Anything in excess shall be shouldered by the cooperative.
“We understand that they (Ignite) really have sufficient capital we can use to rehabilitate our infrastructures and their experience in Iloilo in operating the distribution utility in three years, they have improved the situation in a short span of time,” Lapore said.
Lapore said the JVA is a needed shot in the arm of Ceneco pointing out that its franchise will expire in seven years and there is no guarantee that it will be renewed.
He added that “we have yet to hear from our lawmakers if they will push for its renewal.”
This opportunity will give Ceneco a fresh lease on life “because Ceneco will remain as an entity and the JVA will assure a fresh renewal of the franchise and continuity.”
He added, though, that with or without the JVA “our efforts are towards bringing down the systems loss, that is our mandate.”
Lapore further said the JVA is “not yet a done deal.”
“It is still floating, we have to act on the day to day needs of Ceneco including responding to the needs of our consumers.”
Lapore also said that it was also assured that Ceneco will get to keep its assets such as the Mabini- Gonzaga property, the Alijis property and the 5-hectare property in Talisay, except those areas occupied by the transmission lines and sub-stations which are distribution assets.