- The regional procurement hubs are intended to “curb irregularities in the bidding process” which was alleged to have been resorted to by many ECs in the past, and that in turn, contributed to the high cost of services being rendered by the regional power utilities to their consumers.
Government-run National Electrification Administration (NEA) will create regional procurement hubs to fast-track the project implementation of the country’s 121 electric cooperatives (ECs).
According to NEA Administrator Antonio Mariano C. Almeda, the planned regional procurements would be part of the strategy to streamline and trim the budget on sourcing of equipment, supply and materials for the EC projects, primarily those that will fulfill the 100 percent electrification goal of the Marcos administration.
“NEA will create regional procurement hubs in strategic places in the country, which would expedite the implementation of projects in a least-cost manner, consistent with the mandate of the EPIRA (Electric Power Industry Reform Act),” the NEA chief noted.
The EPIRA is the guiding law on the comprehensive restructuring of the Philippine power sector and that complements the NEA Charter when it comes to the mandated tasks and functions to be carried out by the agency on its supervision of the electric cooperatives.
Almeda emphasized that the agency would want to guarantee that the ECs would “source supply from wholesalers and manufacturers to reduce cost and provide immediate relief during calamities and crisis scenarios.”
He stressed that the procurement hubs are intended to “curb irregularities in the bidding process” which was alleged to have been resorted to by many ECs in the past, and that in turn, contributed to the high cost of services being rendered by the regional power utilities to their consumers.
There are no specific areas given yet by NEA on where the proposed regional procurement hubs would be sited, although it is reckoned that these may be set up in areas that have relatively seamless logistics access.
Beyond systematizing procurement processes, Almeda stated that part of the catch-up measure they will be enforcing would be on the establishment of “digital command centers” across NEA premises, and that is lined up as a strategic way to monitor the real-time operations of the electric cooperatives.
The electrification agency similarly indicated that it will be pursuing annual audit on the ECs, instead of the usual three-year cycle review being done on their operations.
Almeda qualified though that to concretize that task, NEA will be needing additional budget so it can tap additional personnel that will join its audit team for the electric cooperatives.
NEA specified that it will “strengthen its EC audit department by hiring additional personnel to conduct yearly audit of all 121 ECs, instead of the 3-year cycle,” adding that such policy will be instituted to advance “the practice of transparency and good governance in the EC operations.”
He highlighted that “to ensure that the financial validity of the ECs, the percentage on the financial aspect of the key performance standard for EC categorization has been significantly increased from 25-percent to 40-percent.”
To date, many ECs still struggle on achieving financial viability warranting creditworthiness that would be enticing enough for the banks or lenders to consider, primarily when it comes to project financing.
