AFTER the multimillion loan controversy of the Misamis Oriental II Rural Electric Service Cooperative Inc. (Moresco-2), the Provincial Board of Misamis Oriental is wary over the proposed capital expenditure of another electric cooperative in the province.

Misamis Oriental Vice Governor Jose Mari Pelaez said they have “learned [their] lessons” from the alleged mismanagement in Moresco-2.

Although the Board's approval of the proposed expenditure is not a prerequisite of the Energy Regulatory Commission (ERC), the Misamis Oriental I Rural Electric Service Cooperative Inc. (Moresco-1) now wants to get the support of the provincial legislative body for the approval of its P753,000,000 proposed capital expenditure.

Engr. Julie Real, general manager of Moresco-1, said in his speech at the Provincial Board on June 23 that this “huge” amount Moresco-1 is proposing would be spent for the upgrading of power distribution in Western part of Misamis Oriental for 2015 to 2017.

"To improve the system in terms of reliability is a requirement by the ERC for all the proposed ‘capex’ (capital expenditure) and that's what we are planning for. We see it important to upgrade our system as we are expecting a 7 percent average annual new member consumers," Real said.

Real added the power supply of Moresco-1 has to meet the growth of the province’s western area.

The subject proposal includes the construction of new sub-transmission and sub-station in Initao, metering equipment and transformers and non-network projects.

The large part of the amount will also go to the Moresco 1-Pacerm Energy Corporation power supply contract, Real said.

Pacerm-1 is a private power-generating corporation and duly registered with the Security and Exchange Commission (SEC).


Real said the proposed loan will counter the possible power shutdown that happened to Agus 2 in Lanao del Norte and Western Mindanao Power Corporation (WMPC) that led to a Mindanao-wide blackout last May 9.

He added that Moresco-1's “non-firm” power supply contract with the National Power Corporation (NPC) will end by august 2015.

While Pelaez agreed on this statement, he questioned Moresco-1 officials within the fourth degree of consanguinity or affinity to the incorporators of Pacerm-1.

Eugene Velasco, who is the financial manager of Moresco-1, also happens to be an officer of Pacerm.

Emmarck Lazo is a son-in-law of Melvyn Eballe, Moresco-1 director for Opol District.

Maria Lina Perez Saga is a sister of Zosimo Perez, director for the Lugait district. Eusebia Quilab Piscos is a sister-in-law of Real.


"If this planned proposal will be approved by the ERC, a 14 percent per kilowatt hour increase might happen," Real said.

Real maintained that before this proposal will proceed to the ERC, public hearing for the supposed power rate hike will be conducted first.

However, the militant group Kalipunan ng Damayang Mahihirap (Kadamay) does not take this upgrade advantageous to the member-consumers of Moresco-1.

"We strongly oppose to this proposal of Moresco-1. Ultimately, this upgrade adds up to the already burdensome electricity bill of consumers," Francisco Pagayawan, Kadamay chairman in northern Mindanao, told Sun.Star Cagayan de Oro by phone Monday afternoon.

The P753-million proposed project of Moresco-1 will be passed to the ERC after its pending request will get its result regardless if it be rejected or approved.