Philippine Standard time

Resolving Energy Problems in Mainland BARMM


The Department of Finance (DOF) ordered the government-owned agency Power Sector Assets and Liabilities Management Corporation (PSALM) to cut off the power supply to Lanao del Sure Electric Cooperative, Inc. (LASURECO) and restrict Maguindanao Electric Cooperative, Inc. (MAGELCO) from providing electricity. LASURECO and MAGELCO failed to pay their combined outstanding debts, amounting to PHP 16 billion (Yang 2022). Compounding interest, financial mismanagement, alleged corruption among staff members of electric cooperatives (ECs), low efficiency in collecting from consumers, and high system loss due to illegal electrical tapping and politicizing are considered the root causes of the huge debt problems of MAGELCO and LASURECO. These are persistent issues that have plagued energy cooperatives for decades. Some policy proposals have begun to consider creating a condonation bill in Congress, paging the representatives of the affected districts, given that the reported “PHP 16 billion obligation is a carryover from the past” and “has accumulated due to the leniency and laxity of the collecting agencies” (Lanto 2022, A4). Additionally, BARMM has the option to pay the huge debt of the two ailing ECs, as well as to assume control by restructuring the management immediately. Lastly, since there are already local government-owned distribution utilities in the Philippines, it is also advised that viability of local government units (LGUs) taking over the electric distribution in their franchise area be studied.


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