FOLLOWING the Northern Davao Electric Cooperative’s (Nordeco) alleged unsettled P318.4-million power debt, the Independent Electricity Market Operator of the Philippines, Inc. (IEmop) has suspended the cooperative from participating in the Wholesale Electricity Spot Market (Wesm), effective September 25, 2025.
The suspension, issued under Clause 3.15.8 of the Wesm Rules, came after Nordeco repeatedly failed to pay its energy settlement obligations.
IEMOP said the order will remain in effect until the cooperative fully settles its arrears and receives a formal notice lifting the sanction.
As the designated Independent Market Operator under Republic Act 9136 or the Electric Power Industry Reform Act (Epira), IEmop is mandated to ensure a transparent and competitive power trading system.
“Participation in Wesm requires strict compliance with market rules and financial accountability. Nordeco’s suspension highlights the consequences of non-settlement and reinforces the importance of transparency in the power sector,” IEmop said in a statement.
Nordeco’s reply
However, Nordeco dismissed the advisory as “misleading” and “fake,” urging its member-consumer-owners to ignore circulating reports.
“To our member-consumer-owners, be wary of the damaging interference of DCM, Tagum City Chamber of Commerce, DLPC, Provincial Governor of Davao del Norte, and their allies maligning Nordeco as you are part owners of the cooperative. To the member-consumer-owners, do not be swayed by the rhetoric of personalities and groups opposed to Nordeco as they have personal and vested interest adverse to the member-consumer-owners,” its statement read.
It added that it has raised the issue to the Supreme Court and the local courts to protect the interest of its “member-consumer-owners.”
“Thus, any and all social media post adverse to Nordeco are just part of the efforts to tarnish its image in the hope of gaining the courts’ attention,” the statement added.
It also insisted that it remains to be the official electric distributor of Davao de Oro and Davao del Norte except the Municipalities of Carmen, Braulio E. Dujali, and Sto, Tomas, and the City of Panabo.”
“The legal controversy, questioning the constitutionality of R. A. No. 12144, shall have been resolved,” it ended.
However, Nordeco has not yet issued a direct clarification regarding its P318-million obligation, according to IEmop.
Mounting concern over service reliability and rates
Consumer advocates and business groups in Davao del Norte and Davao de Oro have warned that the suspension could aggravate the region’s already unstable electricity supply.
According to data obtained by the Davao Consumer Movement (DCM), Nordeco’s overdue amount stood at about P379.9 million as of August 31 — reportedly the highest among all Wesm participants — and remained at around P337.6 million by late September.
Records also show that nearly half of Nordeco’s electricity supply came from Wesm as of July 2025. Without access to the spot market, the cooperative will have to depend solely on bilateral power supply agreements, which might not be sufficient during periods of peak demand. This could result in rotational brownouts, costlier electricity, and diminished service reliability for both households and businesses.
Franchise renewal under fire amid legal challenges
The Wesm suspension comes as Nordeco faces growing resistance to its bid for franchise renewal in Davao del Norte, Davao de Oro, and the Island Garden City of Samal.
The Tagum City Chamber of Commerce and Industry, Inc. has publicly supported efforts to block the cooperative’s renewal, citing economic losses caused by poor service and high electricity rates.
“Businesses are forced to spend more as they replace damaged electrical equipment and purchase modular generator sets,” the group said.
Similarly, the Samal Island Food Establishment Association (Sifea) stressed that reliable power is essential for tourism and food safety, adding that it supports the call to allow “a more capable distributor” to serve the island.
The issue is further complicated by Republic Act 12144 (RA 12144), which took effect in April 2025. The law expands the Davao Light and Power Company, Inc. (DLPC) franchise into areas currently under Nordeco’s service coverage. Nordeco has challenged the law before the Supreme Court, calling it unconstitutional and a threat to the cooperative system’s autonomy.
DLPC, for its part, has reportedly set aside P1 billion for the possible acquisition of Nordeco’s assets as part of the transition plan once the Supreme Court ruling is finalized.
Financial and operational strain
IEmop’s decision to enforce Nordeco’s suspension underscores stricter enforcement of compliance in the electricity market. The operator earlier noted that penalties and possible deregistration of non-paying entities are crucial to maintaining market stability and fairness.
For Nordeco’s consumers, the situation raises pressing questions about service continuity and rate adjustments. Many fear that without Wesm access and amid unresolved debts, the cooperative’s financial health could deteriorate further — worsening brownouts and increasing electricity costs in its franchise areas.
Despite mounting criticism, Nordeco insists it remains the exclusive power distributor in its jurisdiction and continues to operate “in full and normal condition” while awaiting a Supreme Court decision on the franchise dispute.
SunStar Davao has reached out to Nordeco to clarify its alleged mounting Wesm debt, but has not received a response as of press time. DEF