Power coops ordered to explain irregular procurement process

The National Electrification Administration (NEA) has issued show cause orders to an aggregation of electric cooperatives (ECs) for their apparent failure to observe rules on transparency.

The aggregation of ECs include the Ilocos Norte Electric Cooperative, Ilocos Sur Electric Cooperative, La Union Electric Cooperative, Pangasinan 1 Electric Cooperative, Benguet Electric Cooperative, Kalinga-Apayao Electric Cooperative, Mountain Province Electric Cooperative, and Sorsogon 1 Electric Cooperative.

NEA said the ECs were directed to report and explain the highly irregular process undertaken regarding the competitive selection process (CSP) for the purchase of aggregated power requirement totaling to 130 megawatts (MW).

NEA said the ECs intend to procure through a joint CSP covering their short-term power requirements from 2022 to 2025 in their respective franchise areas.

According to the NEA, the ECs joint third party bids and awards committee declared two failed biddings on June 14, 2022 and Dec. 9, 2022 when the bidders were found short of the requirements as prescribed under the pertinent terms of reference.

NEA said this paved the way for the ECs to resort to direct negotiation as sanctioned under a Department of Energy circular and a NEA memorandum.

“However, despite the successive failures of the participating bidders in the conducted CSPs to comply with the project’s specifications, the aggregation still limited negotiations with them,” it said.

“When pressed by the administrator as to why the aggregation still chose to negotiate with the CSPs participating bidders despite their apparent failure to comply with the project’s terms of reference, it was further discovered that the aggregation had in fact already issued a notice of award for the implementation of the project, despite failing to inform NEA of the development,” it said.

NEA said these developments prompted its administrator, Antonio Almeda, to order that the aggregation’s officers be made to show cause why they should not be found administratively liable for having violated the pertinent laws, rules and regulations on the proper conduct and transparency for the procurement and awarding of the project.

Almeda said that should the ground exist, NEA shall refer the matter to other pertinent agencies for further investigation.

“The administrator stressed that fairness and transparency in the selection process for the benefit and protection of the member consumers should prevail,” the agency said.