NEA Media Release

NEA hails appointment of new Philreca GM


The National Electrification Administration (NEA) has welcomed the appointment of Atty. Janeene Depay-Colingan as the new Executive Director and General Manager of the Philippine Rural Electric Cooperatives Association, Inc. (Philreca). Philreca announced the appointment of Colingan on Monday, March 19, making her the first woman to take on the role. She replaced former Philreca general manager Wendell Ballesteros. Philreca president Presley De Jesus said Colingan's extensive experience and impeccable track record made her the right fit to lead the association into its next phase. "With her extensive knowledge and exposure in the operations and management of the electric cooperatives and our aspirations in the Rural Electrification Movement, we are confident that she would bring fresh ideas, innovations and strategic initiatives to our advocacy in support of rural electrification and consumer-driven reforms in the power industry," De Jesus said. NEA Administrator Edgardo Masongsong welcomed Philreca's decision to designate Colingan as its general manager and executive director. He likewise expressed satisfaction with the changes being made by Philreca to make the organization more effective. "Atty. Janeene Depay-Colingan is equipped with knowledge, skills and attitude required of the position and to take the cudgels in the execution of the policies, programs and projects set forth by the Board of Directors led by its dynamic and responsive president in the person of Presley De Jesus," the NEA chief said. Meanwhile, National Center of Electric Cooperative Consumers, Inc. (NCECCO) national chairman Akmad Mamalinta extended his warmest congratulations to Colingan, and assured her of their support. "Atty. Colingan is a well-respected figure in the EC sector. Her assumption as Executive Director of Philreca is a breath of fresh air. She has the support of NCECCO," Mamalinta said. Colingan is currently the Consultant Coordinator of the Regulatory Affairs Office (RAO) Team of the NEA. She holds a Bachelor of Science in Commerce major in Banking and Finance, and a Bachelor of Laws from Saint Louis University, Baguio City. Organized in July 1979, Philreca is a non-stock, non-profit national organization, which is comprised of 121 electric cooperatives operating in the country. Its member-ECs have provided electricity service for more than 12 million power consumers throughout the country. ###



LEZO, Aklan—Successful cooperatives are all alike; unsuccessful cooperatives fail in their own way. For the Akelco Employees Multipurpose Cooperative (AKEMPCO), it’s all about managing expecta-tions and getting its priorities straight. It has been 15 years since this employees’ co-op of the Aklan Electric Cooperative, Inc. (AKELCO) was established and until now, its members continue to live by the classic business mantra of their founding fathers: do more with less, or better yet, make some with none. Someone who is unfamiliar with the concept will probably shake his head in confusion. What can you possibly expect to produce out of nothing? It’s a legitimate question that seems to have no logical an-swer but, in a cooperative environment, this is a problem easily solved. STARTING SMALL Cooperatives thrive when economic democracy is established and this applies to AKEMPCO as well. Its pioneers, consisting then of only 42 regular AKELCO employees, decided to help each other out by forming a new organization that is flexible enough to serve their varying needs. According to AKELCO general manager Engr. Alexis Regalado, who worked as the founding chairman of the co-op for seven years, they started it in 2002 under the leadership of Mr. Edgardo Masongsong, now the National Electrification Administration (NEA) chief. Masongsong has been credited as the one who launched the employees’ cooperative for AKELCO in his capacity then as member of the NEA-backed management team that was tasked to rehabilitate the pow-er distribution utility during its ailing years. The objective was to promote an initiative on workers’ empowerment. To set AKEMPCO in motion, Regalado said they raised P5,000 as initial capital through an automatic P50 deduction from their monthly salaries at the time. Their pooled resources plus a P50,000 donation from AKELCO were then used to fund a microlending business venture. This became their original enterprise, ticking off the first mission they have set for themselves: to develop an organizationally and financially viable co-op. Under a usufruct agreement, AKEMPCO converted a 10-square meter old guard house into a small of-fice inside the distribution utility’s compound in Lezo to begin processing loan applications from its member cooperators. They initially offered regular loans ranging from P10,000 to P50,000 during its first five years. Members could also borrow P5,000 to P10,000 in cases of emergency and other short-term loans (e.g. miscellane-ous trading, appliance, vehicle, petty cash, etc.) have been introduced. The amounts later on increased when they extended flexi loans between P100,000 to P300,000 at low interest rates. Soon, the once fledgling co-op attracted more people, bringing its official membership count to 294 as of late 2017, including former and retired AKELCO employees. The organization likewise added a small grocery store and a catering service among their business un-dertakings, plus a franchise of Phoenix gasoline station at Toting Reyes, St. in Kalibo, which they ac-quired last year. In less than two decades, AKEMPCO stretched its working capital to P16.117-million, and they now find themselves staring at more than P40-million in total assets. How did this happen? Of course, not overnight. OVERCOMING CHALLENGES The current AKEMPCO executives said it is a combination of sound operational management backed by strategic business decisions. They were able to finance a number of loans all at once through proper facilitation of outsourced funds. Chief among their rivals are the banks moving in town that are way more capable of providing bigger loans. But instead of getting intimidated by their presence, they looked at these financial institutions as potential partners. In 2014, a time when AKEMPCO was reeling from a series of major setbacks, its officers turned to the United Coconut Planters Bank-Coconut Industry Investment Fund (UCPB-CIIF) to help finance the P10-million required capital for their flexi loan program. “We need to look for [banks] that have low interest rates to outsource [those funds] so it would appear that our word is our only capital,” said board member Gary Masigon, who has been with co-op for 11 years and counting. In streetsmart lingo, this is what Pinoys would refer to as “laway lang ang puhunan;” in business terms, it’s called leverage. “We are not shelling out cash…” Masigon said. “But we still make a profit [in the process],” AKEMPCO general manager Anna Tamayo added. This strategy helped turn things around in the co-op after enduring some financial struggles in 2013 due to mismanagement issues. Securing a bigger funding has kept AKEMPCO afloat as it was able to match the loanable amounts that most banks would extend. Masigon revealed they are in fact going to further increase their flexi loan program up to P500,000—still at low interest rates and with longer repayment period—just to remain competitive. “We need to keep up with what the banks are offering so our [borrowers] would stay with us,” he said. The AKEMPCO officers also left no room for errors during their recovery period and began hiring new people to revitalize their operations. Tamayo was recruited to fill the general manager position, which was vacant for quite some time, to focus on the expanding activities of the co-op. Learning from experience, incumbent AKEMPCO chairman Francis Ramos II said they intend to add more personnel in the future to help them run their other businesses. The hiring of an accounting clerk for their gas station will be introduced this April when they hold their general assembly. “We need another person for that [fuel station business] because we know Ma’am Anna cannot handle everything. We also grant rebates to our accounts there because that is the only way we can hold them [as regular customers] so we have to monitor that as well,” Ramos explained. Despite expanding into other ventures, however, Masigon said granting loans to their co-workers in need is still their top priority because “the return of investment is quick and the expenses are not that heavy on people.” “Our [money] lending [service] is considered as an everyday need of our members—the availability of the loans—so we really need to put funds in it. We cannot sacrifice that window because that is where we receive immediate returns,” Ramos added. DREAMING BIG Nevertheless, AKEMPCO is not closing its doors on every possible opportunity for growth. Its officers are currently toying with the idea of putting up a budget friendly hotel in Boracay, the eco-tourism hub of Aklan, per the suggestion of their biggest shareholder, Engr. Regalado himself. Regalado said AKELCO has a vacant lot in Boracay, which it offered for development to AKEMPCO, also under usufruct. He encouraged them to build a mid-range hotel enough to accommodate casual travellers to the island or serve as venue for company seminars and other events. Ramos and his colleagues have all expressed interest in his proposal but they wanted it to go through a comprehensive evaluation first. Also, the AKEMPCO execs said they prefer to acquire the property it-self and not through usufruct so they can own all the rights to it. Masigon likewise noted that a hotel investment would require sizeable sums of money as capital, espe-cially in Boracay where lands are priced three times higher than the average. “The plan is great but let’s put it under feasibility study first,” he said. They are also exploring other options, including a franchise of a popular convenience store that could double as an outsource payment collection center for AKELCO, or adding another gasoline station. “We are open for suggestions, especially if we can count on the NEA for support,” Ramos said. The AKEMPCO officials, nonetheless, indicated that they are not going to hastily embark on other projects if it would put the funds intended to support the welfare of their members at risk. Despite having a P40-million asset at their disposal, and even if they are at liberty to outsource funds from the banks, Ramos said every proposed business venture must have the consent of the majority before it pushes through. This is perhaps what sets AKEMPCO apart from other enterprises. It is always conscious about putting service to its people first before profit. When asked how much, in terms of dividends, does each mem-ber receive from their overall transactions, the co-op officials had this answer: “We do not put that much emphasis on dividends because we would rather keep our interest rates low so more people could avail our financial services. While the dividends may be minimal, at least the ben-efits redound to all our members. To us, that is more important.” As distribution utilities, electric cooperatives operate under the same principles and processes. Only somehow they differ in management styles with the kind of strategies they employ, which reflect on their performances that determine their measure of success. ###

THE WORKPLACE. What used to be a 10-square meter office has developed into a 100-square meter workplace for AKEMPCO after the AKELCO board granted its expansion through a resolution passed in 2009. (NEA Photo)

TEAMWORK. The men and women who are keeping AKEMPCO very much alive. L-R: Mr. Gary Masigon (board member), Ms. Duanne Concepcion (board member), Ms. Anna Tamayo (general manager), Mr. Edwin Biocos (vice chairman), and Mr. Francis Ramos II (chairman). (NEA Photo)

NEA, ECs vow completion of rural electrification projects by 2022


The National Electrification Administration (NEA) and its partner electric cooperatives (ECs) have pledged their full commitment to complete all pending state-funded rural electrification projects by 2022. The commitment was made during the ECs General Managers' Session held recently at the NEA H.E.S Auditorium in Diliman, Quezon City that gathered 134 delegates, consisting of general managers, board members and representatives from 112 ECs. Addressing the EC participants, Administrator Edgardo Masongsong reminded them of their mandate to ensure that the benefit of electricity reaches every Filipino household. He also urged the ECs to come up with strategies to fast-track efforts in achieving energy access for all by 2022. "The ways of the past were already proven inadequate to the demands of the country's growing rural economy. We have to catch up, double our efforts and ensure that our services are more than enough to drive the Duterte administration's economic legacy after 2022," the NEA chief said. NEA Deputy Administrator for Technical Services Engr. Artis Nikki Tortola, meanwhile, said there is still much work to be done but assured the ECs of the agency's commitment to providing necessary assistance to help them in carrying out the electrification projects. "The end goal is [to ensure] that all potential consumers are energized. NEA will adjust accordingly to the strategies that the electric cooperatives will be taking in order to [keep the projects within] the proposed timeline," Tortola said. Latest data from the rural electrification agency show there are still 23,464 sitios in the entire country that do not have access to electricity. Of the total number of unenergized sitios, 19,740 sitios are identified as "implementable" to date, most of which are in Mindanao with 8,535 sitios, followed by Luzon with 6,541 sitios, and Visayas with 4,664 sitios. The figures are based on updates submitted by the ECs to the NEA in a series of Sitio Electrification Program (SEP)-Phase 2 summits conducted nationwide by its Corporate Planning Department, in coordination with the Accelerated Total Electrification Office, from November 2017 to February 2018. For this year, the NEA and its partner ECs target to bring electricity to 1,817 sitios--560 in Luzon, 552 in Visayas, and 705 in Mindanao. Further, the agency is requesting P5-billion from the national government to finance the 3,626 electrification projects under SEP for 2019. Last February 21, the NEA gathered the general managers of different ECs under its supervision to discuss, among others, the progress of rural electrification projects in their respective coverage areas. Before the assembly ended, the EC participants pledged their commitment to strongly support the government's Rural Electrification Program by fast-tracking the implementation of SEP, Barangay Line Enhancement (BLEP) and Household Electrification Programs (HHEP). They also committed to "complete and energize the REP projects for BLEP, SEP, HHEP for the year 2018-2022 and adhere to the rules and regulations of the NEA concerning the efficient utilization and timely liquidation of subsidy funds." ###