Daneco-NEA warns impending PSALM disconnection; “A bluff again,” says Daneco-CDA 

June 6, 2014

The National Electrification Administration project supervisor to Davao del Norte Electric Cooperative has warned that the electric cooperative would be disconnected of power by its main supplier PSALM anytime soon this month if it continues to pay low to its ballooning power obligations.

NEA project supervisor Engr. Godofredo Guya bared in press conference Wednesday in Tagum City that Daneco has only about 70 percent collection efficiency rating while it is being saddled by a ballooning power obligations from its four power suppliers amounting at press time to a total of P767.01 million, of which P601.37 million is due for the Power Sector and Assets Liabilities Management (PSALM).

Daneco-NEA officials said that throughout the franchise area in Davao del Norte and Compostela Valley, Daneco has more than P1.1 payables from member-consumers. 

Guya said that the Department of Energy has “apparently given go signal” to PSALM to cut its power supply to Daneco.

Last week, PSALM president and chief executive officer Emmanuel R. Ledesma in a statement said that PSALM requested the DOE to issue a notice of disconnection against Daneco due to the failure of Daneco to comply with the financial obligations under their power supply agreement.

Guya, however, did not show any written letter from PSALM addressed to Daneco-NEA relating power disconnection.

But the warning of power disconnection aired by Guya and Daneco-NEA officials has been immediately tagged by opposing Daneco-NEA media spokesperson Oliver Autor as “a desperate move, a new bluff threatening consumers of total blackout like what they did last year.” 

Autor charged that Daneco-NEA is resorting anew to threats based on bloated obligations so that member-consumers would have to pay their electric bills to Daneco-NEA.

He said that last year Daneco-NEA officials threatened member-consumers that the power obligations had already reached more than P700 million when “in truth it was only more than P300 million.”

Daneco-CDA board president Engr. Albert Omega also earlier contended that PSALM could not arbitrarily cut its power supply without the hearings of Energy Regulatory Commission.

Omega claimed that ERC was no longer entertaining Daneco-NEA as the body wanted only to deal with one Daneco entity.

During the press conference, Guya and Daneco-NEA officials bared that Daneco has already an outstanding power obligation to Engineering Equipment Inc. (EEI) Power Corp. amounting to P101.93 million.

It was a first revelation on Daneco’s obligations to EEI since the latter started supplying Daneco during peaking hours October last year amid long daily rotational brownouts. EEI is a diesel-powered 13-megawatt independent power producer based in Tagum City. 

Besides, Daneco has also power obligations of P50.94 million from the Aboitiz-owned Therma Marine, Inc. (TMI) and P12.76 million from the National Grid Corp. of the Philippines.

Daneco failed to pay P576 million outstanding debt to PSALM covering the period March 2013 to April 2014, causing Daneco–NEA in June 2013 to seek for loan restructuring of the P275 payables with a monthly amortization of P8.15 million.

PSALM, however, said that Daneco-NEA “had dutifully paid” the monthly amortization while the Daneco-CDA group failed to settle its power bills, the latest of which being given in December 2013.

PSALM apparently is seeing Daneco as one entity being the main power generating supplier since then when it was yet the original, bigger National Power Corp. 

So with the other secondary power suppliers whose contracts to supply power were made before July 2012 when Daneco was still one entity, without divisive infighting over who is legitimate between Daneco-NEA and Daneco-CDA groups. 

PSALM and TMI supplies power to Daneco at an average of 30 and 15 megawatts, respectively. (Rural Urban News/Cha Monforte)

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