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Woeful Zambo co-op; Telecom towers a boon

Energy Secretary Alfonso Cusi has a point in telling some irresponsible electric cooperatives to shape up or ship out. 

Electricity customers have been complaining of persistent and unresolved power outages stemming from the heavy debts and the inability of certain cooperatives to pay their power supplier.

Zamboanga City Electrical Cooperative Inc., or Zamcelco, is one power distributor that has not lived up to the end of its bargain. The co-op, one of the most debt ridden and cash-strapped power distributors in the country, has consistently failed  to make timely payments to Western Mindanao Power Corp. of the Alcantara Group, which operates a 100-megawatt diesel power facility in Sangali,  Zamboanga City.

Zamcelco by the middle of January this year has already piled up over P300 million in unpaid bills to WMPC, representing payment for power delivered in October, November and December last year. As diesel fuel constitutes between 85 percent and 90 percent of WMPC’s costs, it soon became unfeasible for the generator to continue ordering fuel from suppliers. Zamcelco and management firm Crown Investments Holdings Inc. have not settled their debts with WMPC and there is no way the power generator can sustain its operations.

The situation has prompted WMPC to write and demand payment from Crown and Zamcelco  on Jan. 18, 29 and Feb. 1, warning that the current diesel fuel supply would run out on Feb 4 and that it was no longer viable to order more fuel supplies without assurances the co-op would settle their outstanding bills.

WPMC in no time sent a notice of temporary suspension of service to Crown and Zamcelco due to the full depletion of existing fuel stocks.

Crown eventually agreed to consider a temporary solution by the National  Electrification Administration to pay P150 million to enable WMPC to purchase fuel good for one month while issues are being threshed out, including a claim that it was over-billed.

But no payment has been made to WMPC, thus far. The standoff has led to serious power outages in Zamboanga City—all because of Zamcelco’s failure to settle its overdue debts.

New employment generator

A common tower policy being prepared by the Department of Information and Communications Technology will soon become a driver of economic growth.

The infrastructure policy is a key move that will enable market-driven forces to improve telecommunication services and rationalize the industry, eventually producing sizable economic benefits. Combined investments in the construction of some 50,000 towers alone are expected to reach $4 billion, or about P200 billion.

The investments will translate into thousands of jobs. The construction of 50,000 towers is expected to give jobs to 10 million to 25 million workers, based on about 200 to 500 laborers per tower.

Acting DICT Secretary Eliseo Rio Jr. is also upbeat about the rationalization of the telcos that would accrue to the benefit of the millions of subscribers. 

He cited that savings of telcos from shared facilities would now go to the improvement of services to subscribers. As the telcos will merely lease the shared towers, they can reallocate the budget they would have spent on on building and equipping the towers to their capex programs for the benefit of the subscribers.

Local government units will also realize additional revenues from the expansion of the towercos situated in their areas. The DICT estimated that if the 19,000 towers built by the incumbent telco players already brought in substantial income, the goal of 50,000 towers on different areas of the country would nearly triple the current take.

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Topics: Ray Eñano , Energy Secretary Alfonso Cusi , electric cooperatives , Zamboanga City Electrical Cooperative Inc. , Zamcelco , Department of Information and Communications Technology , DICT , Telecom towers
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