DOE SEC CUSI AND THE EC ASSN PHILRECA

David Celestra Tan, MSK
20 March 2019

We cannot help but notice the continuing tug of war between Department of Energy Secretary Alfonso G.Cusi and the leaders of the Philippine Electric Cooperative Association or Philreca over the chronic non-performance of many electric coops and what should be the long term solution.

Philreca’s membership and officials apparently got riled by a letter written by Secretary Cusi last January 9 to House Speaker Gloria Macapagal Arroyo endorsing the cancellation of the distribution utility franchises of 17 seriously distressed electric coops. Philreca reacted like a threatened lion.

While most EC’s listed were inarguably ailing and needed serious revamps, like Daneco, Aleco, Zamcelco,  and others, there were others that were curiously thrown in the list that though problematic with bad management and complicated political interference are nonetheless still not ailing and not even close to being distressed as defined by RA 10531, like Masbate,  Oriental Mindoro, and Mainland Palawan.

It is not clear how Secretary Cusi came to writing such a bold letter prematurely, and who did the staff work for such an important step by the Department of Energy. He may have been thrown into frustration with President Duterte himself calling out the bad performance and brownouts in Puerto Princesa and Masbate. Or he may be taking a page from President Duterte’s “shock and awe” style to get people’s attention and shape up?

Prematurity realized and recommendation reassessed

Nonetheless, within a few days Secretary Cusi evidently realized the prematurity of the letter and withdrew the recommendation for updating of data and reassessment as announced by DOE Undersecretary Wimpy Fuentebella.

It was equally a bold move for the Secretary to correct his own course once he realized the action was too early. Courage and humility are virtues of good leaders and statesmen. It is good to see them slow down when going too fast, changing direction when off-course, and going full speed towards a destination. Focus should always be on doing the right thing. No one of us should be too big to correct our mistaken directions.In these the Secretary seem to have handled it well.

Secretary Cusi took a step further and appear to have extended the right hand of peace and dialogue to the electric coops, assuring them that the performance reviews and fact finding efforts are to get to the deep-seated problems of the electric coops, that the assessments will be objective, and the Philreca leaders and members are invited to participate in the search for long term solutions. According to the DOE press statement, the EC’s were assured of due process.

Philreca’s Curious reaction

Philreca curiously seems would have none of it despite the hand of peace and dialogue clearly extended by the Secretary. They fired off a memo in defiance asking the EC’s to submit their performance reports only to the NEA….and let the DOE get it from them. A regretful and unnecessary disrespect. They apparently are treating Secretary Cusi’s letter as an irreversible shot across their bow,  a line in the sand over which they are willing to do battle. Seems perplexing and pointless.

As many observers did, we feel Philreca’s saber rattling and muscle flexing is surprising and looked like they are more interested in picking a fight against a magnified enemy a posture that some people could ascribe only to a desire to raise their profile before the coming elections where Philreca is running as a party list for Congress.

In an unfortunate “let us show you who you are messing with” gambit, Philreca saw it appropriate to wage a signature campaign to petition the removal of Secretary Cusi. Maybe Philreca is not realizing, but these uncooperative moves are starting to make them look like they don’t want to be looked into and giving the impression that they have things to hide.

Still others say the Philreca has some “hugot” in the way they are reacting to Secretary Cusi, who EC’s felt are not supportive of them when he refused to endorse some big funding for rural electrification.

Some EC’s are suspicious of a hidden game plan to “sell” the Coops with the emergence of parties who are close to Speaker GMA to be aggressive applicants to take over DU franchises after their apparent successful takeover of the Panay Electric Company in Iloilo.

Focus must be on the EC problems and how to solve them for the long term

Philreca as a national association of electric cooperatives we would think is very familiar with the long running problems not only of the 17 electric coops but for most coops in the country and should welcome this opportunity to look into their deep causes and prospects for a resolution.

Philreca does not exist for its own reason but, as the national association of electric cooperatives, should exist for their members and the pursuit of their good as electric utilities.  It should have been flexing its muscle for many years to strengthen the electric cooperatives, to address their regulatory, political, institutional, and financial problems. The kind of problems that Secretary Cusi seems trying to address now.

In many ways, the openness of the government to consider “private sector takeover” as an option is due to the failure of the EC’s to correct themselves.  They have been relying too much on NEA, looking for someone else to blame instead of looking within.

The EC’s have this wonderful culture of “cooperativism” or “bayanihan” in coming to each other’s aid whenever anyone is damaged by natural calamities. That kind of “cooperativism” should have worked wonderfully in seeking solutions for failing electric cooperatives who may have political, governance, or financial calamities, and should have been harnessed by Philreca in creating long term solutions for their members.

Secretary Cusi’s  EC initiative may have started with an initial wrong turn but is now in the right course.  In this issue, Philreca should put higher priority for the best interest of their members and not for the sake of the association as a political party.  Pasensya na mga pare ko, an uncooperative stance seems out of character for a sector that is founded on cooperation.

The EC’s should welcome this opportunity for a deep review of their problems and to participate in coming up with long term solutions. After all when was the last time this was actually done either by a DOE Secretary or Administrator of NEA or even by a Presidential Asst for Rural Electrification? We will have to go back to the time of the venerable General Pedro Dumol, the father of the electric cooperative system.

Let us hope that the parties (Secretary Cusi and Philreca) will find a mutually acceptable time and venue for a constructive dialogue. That starts with giving each other a chance and the benefit of the doubt.

The problems of electric coops are deep-seated and will actually require honest acceptance. How do we insulate it from politicalization? how do we develop competent and honest managers? How do we elect qualified directors? How do we stop corruption? how do we improve our regulatory environment and compliance? How do we collect from the LGU’s who treat their monthly electric bills as a discretionary fund?

It is also a good time to revisit the EC’s role in national development. How do we reconcile the need for cost efficiency as a utility and the high cost of missionary services?  Should they be required to operate efficiently and cost competitively as public service providers? How about separate rules and rates for their missionary responsibilities?

This website had written about the role of the various government institutions in the weakening and failures of the electric coops. And to be honest, we can right the EC’s if we right the way the government institutions deal with them.  When government officials talk about privatizing electric coops, they are actually abdicating their obligations as government officials to perform their own roles for the well being of Electric Coops. It is akin to the AFP proposing to privatize the PNP force because they cannot do their job as law enforcers.

While we are on the subject of dialogue, let us include all the Electric Cooperatives groupings that have sprouted to address their common goals. Let it be a solution of national consensus. Let us hope NEA Administrator Edgar Masongsong weighs in on this momentous occasion and be an agent of unity and dialogue.

We wish Secretary Cusi, Philreca and its leadership, and all the other electric cooperatives and their associations well in this opportune undertaking. Your members are counting on you.

MatuwidnaSingilsaKuryente Consumer Alliance Inc.
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