THE House of Representatives passed on third and final reading Monday, January 24, House Bill 10554, expanding the franchise area of Davao Light and Power Co. to now include the Davao del Norte cities of Tagum, Igacos (Samal), and the municipalities of Kapalong, New Corella, Talaingod, Asuncion, and San Isidro, as well as the municipality of Maco in Davao de Oro.
The franchise bill was proposed in response to the clamor of these local government units that they leave their current supplier, Davao del Norte Electric Cooperative (now Nordeco) due to high cost of power and poor service.
The move of the local governments was supported by the local business chambers, tourism councils, and other people’s organizations.
The bill will now go up to the Senate for consideration.
“Davao del Norte can finally march faster forward to progress for our economy and our people. The passage of this bill will usher in a new area of development in our province. Thank you to our Congressmen friends and congratulations to the mayors, councilors, barangay leaders, and all those who made this happen. We will now work with our Senate to finally finish this much-awaited development for our province,” Davao del Norte Governor Edwin Jubahib said.
"The people of Davao del Norte only deserve affordable and reliable power supply as well as world-class service. I will not stop until we make this a reality," he added.
“We are very thankful to the Congressmen friends of the people of Samal for listening to the call of our people for a cheaper, more reliable power supply. Our dark ages will soon be over. This gives us hope that Samal can finally live up to its potential as a world-class tourism destination and economic center not only in the region but in the country,” Igacos Mayor Al David T. Uy said.
While Nordeco (Northern Davao Electric Cooperative) argued that the electric cooperative should be the one deciding on matters on their franchise, the local government leaders insisted that they attempted to resolve their complaints through a petition and signature campaign to Nordeco in 2020.
The general manager and the board of directors of Nordeco however, did not act on the petition which was signed by all the mayors in Davao del Norte. So the LGUs went to Congress instead.
Davao Light is currently serving Davao City and Davao del Norte localities of Panabo City, Carmen, Sto. Tomas, as well as Dujali.
Aside from the unanimous resolutions of the Provincial Board of Davao del Norte, City Councils of Tagum City and Igacos, Municipal Councils of Kapalong, New Corella, Talaingod, and San Isidro, close around 120 barangay councils out of the 140 barangays in the affected are also passed unanimous resolutions demanding that they leave Daneco.
The resolutions were supported by barangay-based signatures from residents.
The local government leaders complained that they are paying close to P3 per kwh more than Davao Light, yet they experience more frequent brownouts, poor power quality, bad customer service, and lack of power infrastructure which is making the province un-attractive to business and preventing the economic growth of their localities as well as negatively affecting the lives of the people.
Local government units also allocate millions of pesos every year to donate electric poles, transformers, and other equipment to Daneco just to energize areas in their localities. Davao del Norte in particular also complained that they used to have only two seats in the seven-man board of directors in Daneco, despite the province having close to 70 percent of the energy demand of the electric cooperative.
The electric cooperative has not had an election for its board of directors since 2012. All the board of directors has been appointed ever since.
Meanwhile, Davao Light, despite having cheaper power and better service, also pays more than P150-million annually in franchise taxes, local business taxes, and real property taxes to its local government units. Daneco, being a cooperative, does not pay taxes.
Samal Island, in particular, has also been complaining of the poor quality of power in the island, affecting the tourism industry.
Instead of upgrading the existing 1.5-kilometer submarine cable connecting the island with mainland Davao, or investing in a long-term connection solution through the ongoing 4-kilometer Davao-Samal bridge project, Daneco announced they are instead building a massive 25-kilometer, P1.5 billion submarine cable connecting the island with far-away Pantukan municipality.
However, the Energy Regulatory Commission, which approves investments of distribution utilities and electric cooperatives as a means to regulate power rates, formally said they have not approved such a multi-billion project.
The ERC also said during the Congressional hearing the franchise that they have issued several show-cause orders to Daneco for the cooperative’s failure to submit required reports on their technical and financial performance to the regulating body. (PR)