Meralco-Comstech backs out of IMC deal Print
Wednesday, 27 June 2018 16:44

Meralco-Comstech has withdrawn from the Investment Management Contract (IMC), an agreement which could pave the way for an operational takeover of the Zamboanga City Electric Cooperative (ZAMCELCO).

The withdrawal has put ZAMCELCO in a precarious position and has once again stirred up fears of a looming power crisis from being serviced by an electric cooperative burdened with huge debts, an above average systems loss and decrepit transmission lines and facllities.

In an interview with E-Media’s Conversa, ZAMCELCO Board President Omar Sahi confirmed that Comstech officials have verbally withdrawn from the deal it intends to finalize with  ZAMCELCO.

The decision was reportedly voiced during a meeting with the National Electrification Administration (NEA) last Monday.

Meralco-Comstech higher-ups are having doubts on being able to turn around the ailing cooperative (Zamcelco) due to its huge systems losses.

At present, Zamcelco’s systems loss has reached 18%, five percent over the 13% allowable limit by the Energy Regulatory Commission (ERC).

Early this year, the ERC has issued a new policy further decreasing the allowable systems loss for cooperatives in the country.

The ERC prescribed an initial systems loss figure at 12% for 2018 until it reaches 8.5% in the year 2022.

Sources said that Comstech is having serious doubts on being able to resolve the systems loss problem given the current state of Zamcelco.

The unexpected withdrawal by Comstech from the IMC deal with Zamcelco is troubling local power industry insiders who are looking at an impending power crisis due to ZAMCELCO’s perilous financial situation.

These reportedly include a two billion peso debt which makes the cooperative lose several million pesos a month and poor lines and facilities which cause power fluctuations and outages several times a week.

The Zamcelco directors are currently discussing their next move in an effort to save the electric cooperative from fully being submerged in debt and avoiding a power crisis in the City of Zamboanga.  (L. Jocson)