It wasn’t long ago that Pampanga Electric Cooperative, Inc. (PELCO) faced significant operational and financial difficulties. In the early 2000s, the National Electrification Administration (NEA) classified PELCO II, which serves the municipalities of Bacolor, Guagua, Sasmuan, Sta. Rita, Porac and Mabalacat City, as an “ailing cooperative” due to substantial operational and financial challenges.
Since PELCO II entered an investment management contract (IMC) with Comstech Integration Alliance Inc. with Manila Electric Company (MERALCO) as its technical partner in 2014, its performance has steadily improved.
Within a decade, PELCO II has achieved a complete turnaround, earning ‘AAA’ rating from the NEA – the highest possible for an electric cooperative.
Meralco senior vice president and head of external and government affairs Arnel Casanova said the company is ready to collaborate with electric cooperatives across the Philippines to strengthen their operations, similar to their work with PELCO II.
With over 120 years of industry experience and advanced distribution systems, MERALCO offers not only technical expertise but also the scale, systems and discipline needed to help ECs deliver reliable and affordable power.
Casanova said they are willing to share their infrastructure and know-how across Luzon, Visayas, and Mindanao to improve operational efficiency, reduce costs, and enhance service reliability.
Casanova said supporting ECs will uplift communities and foster broad-based economic development.
“We want to uplift the lives of people across the country—so that we may build industries like cold storage for farmers, or advanced facilities for our engineers,” Casanova said.
He also emphasized that Meralco efforts are intended to support, not take over, the ECs. “We have no intent of taking over the cooperatives. What we want is to empower them—and upgrade the skills of their people,” Casanova said.
“We’ve seen how electricity has improved lives during rural electrification. Now, we are entering a new era where AI and digital infrastructure will demand even more from our power systems,” he said.
At the time of the partnership, PELCO II was grappling with significant debt and had received disconnection notices from power suppliers, including San Miguel Energy Corporation.
But thanks to Comstech and Meralco’s focus on two key areas, PELCO II was able to recover.
The initial focus of the partnership was on operational improvements, addressing consumer complaints about PELCO II’s previously unsatisfactory service.
This involved a two-pronged approach: Comstech and MERALCO worked to reduce system losses, indicating greater efficiency in electricity distribution. Simultaneously, they improved collection efficiency as service quality increased, leading to better revenue management and financial stability.
Comstech and Meralco’s efforts extended beyond short-term fixes to include infrastructure upgrades for PELCO II.
In 2023, a 20-megavolt ampere (MVA) mobile substation was inaugurated in Bacolor, Pampanga, to strengthen the region’s power infrastructure.
Following this, in late 2024, PELCO II introduced a 10-MVA substation in Mabalacat City, enhancing capacity flexibility and augmenting the existing power supply to meet the growing needs of residential and commercial consumers in the area.
Despite the significant recovery from the difficulties of the 2000s and early 2010s, the work continues.
Looking ahead, Comstech and MERALCO aim to have another 20-MVA substation operational in Mabalacat this year to further improve electricity distribution in the region.
Pampanga, a rapidly expanding economic hub in Central Luzon, requires a dependable power supply. Initially, PELCO struggled to keep pace with increasing demand but later regained momentum.
The turnaround for PELCO II was clearly sparked by the intervention of Comstech and Meralco as its technical partner in 2014, marking a period of consistent progress for the regional distributor.
The cooperative’s performance in 2023 showed an average annual growth rate of 8.5 percent in energy sales and 7.5 percent in its customer base since 2014.
While these figures are impressive considering PELCO II’s prior state, Pampanga’s GDP growth of 6.5 percent in 2023 underscores the significance of the cooperative’s achievements.
Reliable infrastructure, including the dependable power provided by PELCO II, has played a crucial role in Pampanga’s GDP growth.
Financially, PELCO II reversed an P890-million deficit to a P1.702 billion equity position by September 2024, just a decade after the IMC. The turnaround was achieved through asset revaluation and stable net income resulting from MERALCO’s financial discipline and oversight.
These developments suggest that mutually beneficial collaborations with Meralco could be a viable path for other regional distributors.
The Philippines has numerous electric cooperatives (ECs), particularly in rural areas.
Major ECs in the country include the Batangas Electric Cooperative (BATELEC), the Benguet Electric Cooperative (BENECO) and the Ilocos Norte Electric Cooperative (INEC).
Given the increasing power demand nationwide, partnerships with entities like Comstech and MERALCO could be a logical next step for these cooperatives.