• GILBERT P. BAYORAN
The National Electrification Administration (NEA) has given its consent to the joint venture agreement (JVA) between Central Negros Electric Cooperative (Ceneco) and Primelectric Holdings Inc./Negros Electric Power Corp. (NEPC).
NEA Administrator Antonio Mariano Almeda stated in a memorandum that NEA conditionally granted its consent to the JVA, subject to fulfillment of conditions, such as settlement by Ceneco of all its outstanding loans and obligations with NEA and other creditors, who hold liens on its properties, and submit proof of such settlement.
Also included is the payment by Ceneco of the separation pay and retirement benefits under applicable laws and collective bargaining agreements that will be due to its employees who will be separated by virtue of the implementation of the JVA.
NEA also directed Ceneco to submit proof of such payments as soon as such becomes available, and to set aside adequate funds for the bill and meter deposits of its member-consumer-owners (MCOs).
In accordance with Rule Ill, Section 18(b) of Department of Energy Department Circular 2013-07-0015, Almeda said that the assets of Ceneco that were funded or sourced from grants, subsidies or other assistance from NEA shall not form part of the assets that shall be sold to Primelectric/NEPC.
Ceneco has been also directed to identify such assets and submit their current valuation as appraised by a NEA accredited appraisal service provider, which NEA shall then endorse the matter to Office of the Solicitor General or Department of Justice for appropriate action.
NEA also required Ceneco to submit its nominated representatives to the Board of NEPC, and the grant of a valid and effective legislative franchise to NEPC for the current franchise area of Ceneco.
The NEA memorandum also stated that Primelectric/NEPC must undertake that it shall fulfill the mandate for the full electrification of the franchise area of Ceneco which shall be funded by them.
It added that the NEA reserves its right to recommend that this express stipulation be included in the franchise of NEPC.
Also, Ceneco must submit a full accounting of the settlement of its obligations and the net cash amount it shall have after the implementation of the JVA, including all of its outstanding loans and obligations with NEA and all other creditors as well as the value of the assets funded or sourced from grants, subsidies or other assistance from NEA.
Ceneco has been also directed to preserve such net cash and shall only utilize the same with the approval of the NEA.
Should any of the foregoing conditions not be met to the satisfaction to its satisfaction, NEA said its consent to the JVA shall be thereby reconsidered.
Ceneco was also ordered by NEA to ensure the provision of services to its MCOs up to the full implementation of the JVA, and the start of operations of NEPC.
There should be no disruption in services during the transition of operations, NEA said. | GB