State-run National Electrification Administration (NEA) said Tuesday it laid down the specific financial and operational parameters for electric cooperatives (ECs) planning to seek exemptions from local taxes, fees and charges in their local government units (LGUs).
The NEA, in its Memorandum No. 2025-02 dated Jan. 9, 2025, established guidelines that would enable both stock and non-stock ECs to fully avail of the preferential rights granted under the Local Government Code relative to the provisions of NEA Reform Act of 2013.
The memorandum was released as part of its responsibilities under Joint Memorandum Circular 2024-12-001 of the Department of Energy (DOE) and the Department of Finance (DOF).
The JMC will pave the way for all ECs registered with both the NEA and the Cooperative Development Authority to avail of the preferential rights under the law, subject to their compliance with prescribed financial and operational standards set by the NEA.
The agency said to ensure operational and financial compliance, all ECs would be subjected to a set of performance standards.
These determine their delivery of reliable and efficient power distribution services to their member-consumer-owners.
It said key financial parameters include collection efficiency, in which power cooperatives must achieve at least 90 percent.
The NEA will award 25 points for those that will obtain 97 percent or higher. Non-efficient ECs graded 89 percent and below will only be awarded five points.
Meanwhile, a 10-point bonus will be granted to ECs that will maintain “positive” result of financial operation, inclusive of Reinvestment Fund for Sustainable CapEx (capital expenditures).
It said that on the technical front, ECs would be scored based on the frequency and duration of power outages to gauge network system reliability.