The power of power Print
Friday, 02 September 2016 14:44



San Jose, CA. — I have written lengthily about the drought that has caused serious damage to the agricultural sector. Woefully, the dry spell created panic among Zamboanguenos because water became scarce and we were in for the wretched of times. Also, I have written endlessly about Zamboanga’s power situation and what might happen when, not if, our Zamboanga City Electric Cooperative, Inc. (Zamcelco) goes pffft and unable to pay its financial obligations to power providers.

Six months ago, the savant Attorney Vic R. Solis issued a press statement (he does that whenever he’s pissed) disparaging Zamcelco for not seriously addressing the power crisis in Zamboanga. He stated: “There are three things that Zamcelco management must address and resolve with speed. 1. Sale of Putik property to pay off or, at least, reduce its P1 billion-plus debt obligation; 2. Bidding of an Investment Management Contract (IMC) to pave the way for a private management group (like Meralco and Aboitiz - mine) and the rehabilitation of its distribution grid; and 3. Renegotiation of its PSA (power sales agreement) with SRPI (San Ramon Power, Inc.) to establish an inextendible period of time to start up and completion of the latter’s power plant in San Ramon.”

The processes, he added, leading up to the conclusion of these three subjects can be executed concurrently. His roundhouse kick was: “It’s time to get Zamcelco out of the ICU and into the recovery room.”

We’re now in the stage where the Terms of Reference (TOR) for the bidding of an Investment Management Contract (IMC) is being perfected to incorporate the various interventions submitted by stakeholders, including those of the business sector, academe, politicians and professionals. Hopefully, by the first week of October the bidding could be done and an IMC is awarded the gargantuan job of fixing Zamcelco’s finances and operational system. This process will involve millions of pesos.

I was informed that the proposed TOR will give the IMC 40% of the income it will generate and 60% to Zamcelco.

When Zamcelco was restructured with the firing of its manager and suspension of some board members, the coop’s debt was about P400 million. When a new general manager was named and a new board took over from the rotten one, the debt shockingly soared to almost P1 billion. Its system’s loss climbed to 22% from a low 16%. That’s why George got the boot.

But that’s all under the bridge now. We can’t cry over spilled milk. Zamcelco can’t throw itself under the bus again. Now, the TOR is being fine-tuned to please all quarters.

There is an urgent need to reshape and upgrade Zamcelco’s system. Unannounced and sudden power outages occur because of row problems, poor maintenance of lines and worn out, overloaded transformers. Millions of pesos will be needed to upgrade the system, the kind of money that Zamcelco doesn’t have.

Also important is for Zamboanga to have its own efficient and sufficient power service that would last for 25 years and beyond. By 2018, we shall have a steady supply of electricity from the 105-megawatt coal-fired power plant in San Ramon. Like the Western Mindanao Power Corp. (WMPC) in Sangali, the San Ramon power plant will be imbedded and will provide the power demand of Zamboanga. And cheap.

As we prepare to ratify a new constitution ( maybe in three years time) that will abolish the Cory-tailored constitution to pave the way for the creation of a new system of government, having our own source of independent power is necessary. This new system of government was reiterated by El Presidente in his speech during the commemorative program saluting our fallen heroes at the Limbingan ng mga Bayani. He said that he has requested congress to speed up the evolution of a new framework of government.

We need to have our own source of electricity and water source if we are to be converted to an autonomous state or region, depending on the type of government El Presidente wants to have. SRPI will provide the power that we will need. It isn’t a deceptive offer as the power sales agreement (PSA) between SRPI and Zamcelco shows.

Presently, we have more than enough power supply. But when Zamcelco goes underwater, we will have none of such power because power providers won’t extend our coop’s credit line anymore and simply cut us off. Quite disturbing, hey. But true. This almost happened last February when two of our suppliers threatened to cut us off because of unpaid obligations. Cooler and more understanding heads intervened, preventing the unpleasant curtailment.

In my future column, I’ll attempt to illustrate the safety features that SRPI will take in powering its coal plant to ease the apprehensions of some people with environmental concerns.