NEA clears capital infusion in Zamcelco
State-run National Electrification Administration (NEA) has cleared the capital infusion in debt-ridden Zamboanga City Electric Cooperative Inc. (ZAMCELCO) that will alleviate the power coop’s power and financial woes.
NEA has given the directive to ZAMCELCO to proceed with the general membership meeting on Sept. 11 to approve the investor-manager contract (IMC) to ensure compliance with all notice and consultation rules.
The board of ZAMCELCO recently awarded the IMC to Crown Investments Holdings Inc. and Desco Inc. for its winning bid of P2.5 billion.
“To consummate that, it needs the annual general membership confirmation after that it will be forwarded to NEA for evaluation and confirmation,” NEA administrator Masongsong said.
The NEA official expressed optimism that Zamboanga City residents would soon be alleviated from rotating brownouts with the capital infusion from Crown Investments and Desco.
“The offer is truly great for ZAMCELCO. An offer that perhaps you cannot refuse,” he said adding that “for grid partnerships, I am already optimistic especially with a P2.5-billion investor.”
Five bidders submitted their technical qualifications for the IMC namely Crown Investments and Desco, Davao Light and Power Co. of the Aboitiz Group, Nikolas Management Services Inc., Filinvest and Comstech Integration Alliance which is 60 percent owned by Manila Electric Co. (Meralco).
However, only Crown Investments and Desco submitted a financial bid.
The contract covers the management of ZAMCELCO’s operations aimed at immediately solving the financial woes of the power coop, which handles the distribution of electricity in Zamboanga City.
ZAMCELCO has been saddled with debt to its power suppliers amounting to over P2 billion.
The facilities of the cooperative also need an upgrade to reduce its 23 percent systems loss and avoid further power interruptions.
The bid amount of the joint venture should immediately spur businesses in Zamboanga City.
The joint venture said the bid amount is deemed the appropriate amount to pay all existing obligations, provide capital infusion to upgrade the facilities and improve the services of ZAMCELCO.