Issue of January 5, 2020
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BENECO forms committee to secure supply contract
by Jane B. Cadalig

ELECTRIC COOP UPDATES -- Benguet Electric Cooperative General Manager Gerardo Verzosa and Institutional Services Department Manager Delmar Carino  update member-consumers on the status of the electric cooperative during the Kapihan sa Baguio media forum in Baguio City last week. -- Redjie Cawis

This early, Benguet Electric Cooperative has formed a committee to secure the distribution utility’s supply as its power supply agreement (PSA) with Team Energy Corp. is expiring in four years.

The committee, spearheaded by Assistant General Manager Melchor Licoben, is tasked to look for power supply providers and fix provisions to ensure a contract favorable to the consumers.

Beneco General Manager Gerardo Verzosa has earlier said there was a need for Beneco to secure its power supply contract this early to give enough time for the electric cooperative to negotiate for a cheaper cost.

“There is a need for a committee to look at the power supply side of the business because the challenge for Beneco today is will it again have the same opportunity to enter into a contract at a cheaper cost? Verzosa said at an earlier press conference.

Beneco currently sources its 55 to 70 megawatts monthly power supply requirement from Team Energy Corp. at a rate of P3.85 per kilowatt-hour. The 20-year PSA will expire in 2024.

Institutional Services Department Manager Delmar Cariño said one of the factors to be considered by Beneco when it enters into a new PSA will be the capacity to be sourced from the potential power supplier.

He added PSAs have to be secured years before they expire to allow distribution utilities to negotiate with power suppliers provisions that are favorable to member-consumers.

Cariño said the contracted capacity that Beneco will negotiate with potential suppliers will depend on the availability of renewable energy sources from which the utility will source its supply requirements.

The construction of Beneco’s three-megawatt capacity hydro power plant is ongoing at Man-asok, Buguias, Benguet. The distribution utility is also tapping other renewable energy sources in other parts of Benguet.

Beneco’s contract with Team Energy has allowed the electric cooperative to pass on a cheaper generation cost to its more than 130,000 member-consumers.

Beneco’s generation rate is one of the cheapest among the country’s more than 100 electric cooperative.

Last year, Beneco’s generation rate ranged from P3.96 to P4.15 per kw/hr. In 2017, the rate ranged from P3.14 to P4.44 per kw/hr.

The cost of generation, a pass through charge, constitutes bulk of the costs in the monthly electricity bill.

Beneco officials said securing a PSA that provides for cheaper generation cost results into cheaper rate in the monthly bill.

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