The Extension of Bill Collections of Electric Coops Injected an Unintended Virus that Need Immediate Reassessment….Or it can Put Them and Their Power Suppliers Unnecessarily in ICU.

David Celestra Tan, MSK
11 April 2020

While waiting for a COVID-19 Vaccine, the most effective interim measures are social distancing, home-in-place, sanitation, and testing. The government had done a good job, considering the limits of our resources, to move promptly for coronavirus containment strategies and announced a lockdown until April 12, 2020.  Public places and establishments have been closed. And now also public transport. Credit also to the many Filipinos who for the most part cooperated in social distancing regulations…and to our archipelagic country that made it easier to isolate islands of our population.

The government, National and LGU’s, wisely exempted essential services like food, medicines, and utilities like power, energy, and water. And those lockdown toughness to deal with the pasaway’s of our society are welcome for the general good.

There are however well intended government actions that may need to be revisited quickly to avoid their far reaching damage to the electric coops and their ability to provide the vital electricity services during our “shelter-in-place” period and beyond into efforts at economic recovery.

On March 18 the Department of Energy, evidently to mitigate the hardships that will befall our people from the lockdowns, issued an order in “Solidarity with the Country by Deferring payments of obligations and dues for thirty (30) days after April 14, 2020 for the benefit of consumers”.  The Order tried to cover all the bases. Deferred billing by power generators and payment extensions by the fuel suppliers and government agencies. Last in the order, was for “DU’s throughout the country are enjoined to give their electricity consumers a period of thirty (30) days extension of payment for bills falling for the period of 15 March to April 2020. “

It seemed harmless and reasonable enough. However, as a consequence most electric coops in the off-grid areas are not bothering to collect their March billings and not even doing their meter reading. Maybe partly due to the restrictions of the lockdown but mainly because of the DOE order which maybe an over reaction although understandable given the urgency of the pandemic that we all have not experienced before.

Electric power generation companies called NPP’s in these off-grid areas have not been paid their March bill due in the first week of April. Yet they are being asked to continue generating power to serve the customers as also required by the DOE.

 All these in solidarity with the nation in dealing with the coronavirus pandemic that we are suffering but will probably can survive.

A. Lockdown Extension to April 30.

Now it has become necessary to extend the lockdown to the end of the month of April. The NEA and many electric coops are even asking the DOE and ERC to extend the payment extensions virus indefinitely. 

The danger is if the virus of  payment extensions and collection postponements that have been injected into the distribution and generation sector will be extended in its current form without re-calibration, the electric coops will be suffering from its own coronavirus that can be fatal for many of them to the peril of their member consumers. NEA may not be able to provide them enough respirators to keep them alive.

B. Suggested Re-calibration

Before we start talking about recalibration, let us have an understanding on the underlying facts and realities. 

1.Monthly collections are the lifeblood of electric coops. It took decades to instill that community discipline in these islands. Coops are graded for their collection efficiency and for their systems loss. And the willingness to disconnect is critical to the operating health of EC’s. We need to be circumspect before we undo that decades of progress.

2. Electric power service is as essential as food and medicines and very critical like water (and toilet paper?) for the people who are asked to stay home.

3. About 70 to 80% of the electric coop consumers have the ability to pay now. Only 10% are border line and another 10%-15% can be border line after they lose their jobs and close businesses.