The lawyer of the Utilities Consumers Alliance of Negros yesterday said they  agreed during a meeting to subject Central Negros Electric Cooperative to a congressional inquiry because of the increase in its systems loss  that has reached to  about 16 percent,  and its downgrading from category A to Yellow B.

Vicente Petierre lll yesterday said UCAN, headed by Fr. Ernie Larida, Social Action Center director, is  preparing  the documents needed for the Congressional inquiry that  they hope will be held  this month.

He said the downgrading of CENECO to category Yellow B means it is in a critical state and they believe  99.9 percent that CENECO is being mismanaged.

Petierre said CENECO is losing about P17 million by absorbing the 3 percent out of the 13 percent system loss cap allowed by National Electrification Administration. This only reflects the kind of management it has, he said.

UCAN believes that CENECO could no longer recover its losses because of the downgrading in its rating with the NEA from category A to Yellow B, he also said.

Petierre said the danger is that NEA might take over the management of CENECO and   there could be a proposal  for  it to  be privatized.

He claimed that CENECO is availing of loans only to pay its obligations.

CENECO president Arnel Lapore said he believes that a dialog between UCAN and the members of CENECO management and Board of Directors would be  better than bringing  the matter to Congress since here is no need for the passage of a law to improve CENECO.

They can give the members of UCAN an update on how CENECO is  managed, he said.

Lapore said they are open to discuss the matter with UCAN so that the public will be  informed about  the real status of the power firm and the measures being taken to arrest system loss.

The systems loss, which is the cost of electricity wasted in the transmission from the distribution utilities to the consumers,  reached 16 percent last June,  but this has been  reduced to more than 14 percent now, he said.

The CENECO Board has already created a System Loss Committee because, under the law, an electric cooperative cannot pass on a systems loss of more than 13 percent to  its consumers, Lapore said.

CENECO absorbs the excess of 3 percent. So the consumers could not feel the impact of such increase because there is a system loss cap of 13 percent being imposed by the Energy Regulatory Commission, he said.

Lagarde said the category Yellow B only means there were some parameters they failed to pass,  based on the new criteria like  collection efficiency. In 2002, they were also rated category Yellow B but this improved when they were able to comply the requirements.

The evaluation is being held every six months and this is  based on financial, technical and institutional aspects, he said.

UCAN can do them a favor because  it  can inform Congress that there is a need for a law to be passed that a local government unit has to pay its bills with the power firm so they can improve their services, Lagarde said.

Meanwhile, Lagarde has written the Bacolod City Government appealing  for  it  to settle its outstanding electricity bills of P262,131,299.80 as of Oct. 20. The city, having claims that Ceneco also owes it in terms of franchise taxes.

Lagarde said the city government is trying to pay its current bills.

In his letter to Mayor Monico Puentevella dated October 20, Lagarde said  the influx of investors to Bacolod is beginning to stretch CENECO's ageing distribution system.

Lagarde said outstanding LGU electricity bills can become fertile source of funds to finance CAPEX projects without resorting to increase in power rates since these were advanced by CENECO to the generation companies.*CGS

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