The Benguet Electric Cooperative through the interim board of directors (BOD) and ma-nagement is continuing efforts for the renewal of its license and in encouraging its more than 140,000-strong member-consumers to pay their share capital, which is a requirement for its application to register as a stock cooperative.
The issues were among the challenges that Beneco officials presented, discussed, and vowed to address during the 42nd annual general assembly (AGMA) of member-consumers this month in Kapangan and Bokod, in Benguet and Baguio City.
The Beneco interim BOD and management believe that securing a new franchise and registering under the Cooperative Development Authority from non-stock, non-profit into a stock cooperative will be Beneco and its consumers’ best weapon against threats of privatization that have been observed to be hounding power distribution utilities.
Interim Beneco BOD chair Steve Cating said the bill seeking for Beneco’s franchise renewal filed by Baguio Rep. Mark Go pending in Congress is critical as the franchise is expiring on 2028.
“This is critical because Beneco has always been under the threat of privatization. As we know, Beneco is a large cooperative with over P4 billion in sales. So with that kind of sales Beneco is a valuable player in the energy industry. We don’t want to privatize Beneco for sure. We have obligation to energize the entire Benguet and this will not be fulfilled if privatization that may lead in the separation of Baguio and Benguet happens,” Cating said.
He assured the interim board will work on this among the other tasks they have to address, including the election of a new regular BOD and appointment of a new general manager.
The franchise renewal application recently met a setback when Beneco was downgraded to Category C status due to the management crisis last year.
The process would soon push through with the announcement of National Electrification Administration Administrator Antonio Mariano Almeda during the AGMA in Baguio last June 17 that he will issue Beneco a certificate of double A standing, which is a requirement for Congress to accommodate franchise applications of distribution utilities such as Beneco.
Lawyer Delmar Cariño, Beneco Information Services director and Administration head, said they continue to encourage member-consumers to pay their share capital, which is a natural consequence of Beneco’s registration with the CDA.
He stressed among its advantages, the payment of share capital will make Beneco members stronger and will be Beneco’s best weapon against any other intent to secure its franchise area, which are Baguio City and Benguet.
“All electric cooperatives in the country are very apprehensive. They have this fear of private investors of utilities coming in to apply for their franchises, especially if the EC’s franchise is nearing its expiration. And the best way to fight this off is to make the members feel that they really own Beneco and the best way to do that is to pay the share capital. Compared to being just a non-stock cooperative, anything can happen once an outsider expresses interest to privatize Beneco, which we cannot say no to as per the Energy Power Industry Reform Act,” Cariño said.
He said at the moment, there is no official statement or open declaration yet from any private company with interest in Beneco, but the cooperative will always consider that possibility is there, since based on observations of the power sector industry, private companies are always contesting the franchises of electric cooperatives and are interested to secure a franchise in other regions in the country.
Cariño explained to complete Beneco’s conversion, all member-consumers must have paid their share capital, which at the moment is a minimum of P2,000 that can be paid with an initial of P500 and P100 every month until fully paid.
Beneco has so far collected P31 million from 40,000 out of more than 140,000 member-consumers.
Beneco is currently completing the requirements of the Bureau of Internal Revenue before it can be issued a certificate of tax exemption.
Other advantages of members’ payment of share capital are that it will complete Beneco’s conversion from a non-stock, non-profit cooperative to stock cooperative; it will enjoy the provisions of preferential treatment as stated under the Local Government Code; and exemption from payment of local and national taxes.
During the AGMA in Baguio City, Almeda denied plans to privatize Beneco and assured NEA has no other interest in the electric coop but to fix the problems caused by the management power struggle last year and assist it until it regains its triple A status and bring it back to its glory days of excellent operations and delivery of services to its franchise area. – Hanna C. Lacsamana