Jul 8, 2020

PALECO eyes creation of subsidiary cooperative

PALECO Board of Directors chairman Jeffrey Tan-Endriga told Palawan News they had earlier presented the idea to the annual general membership assembly (AGMA) in 2014 where 6,000 members unanimously voted for a favorable resolution.

The Palawan Electric Cooperaive (PALECO) is mulling the creation of a subsidiary cooperative that will focus on power generation from renewable energy sources.

PALECO Board of Directors chairman Jeffrey Tan-Endriga told Palawan News they had earlier presented the idea to the annual general membership assembly (AGMA) in 2014 where 6,000 members unanimously voted for a favorable resolution.

“Ang concentration natin ay renewable energy. We will not compete with conventional technology kasi medyo masalimuot ‘yan. At saka we are promoting green energy so pwede,” he said.

However, Endriga said that it was not discussed during the meeting if those who voted during the 2014 AGMA meeting were willing to invest fresh capital share.

Provincial CDA specialist Marian Concepcion explained that the subsidiary cooperative came from the amendment of the Cooperative Code 9520.

Subsidiary cooperative comes from a parent cooperative and are allowed if all or majority of the members will come from the membership of the parent cooperative.

“Ang maganda dito, hindi on its own ‘yong subsidiary cooperative. Manggagaling pa rin yong help from the parent, from PALECO. PALECO could provide the technical, managerial, at financial support to the subsidiary. Ang kagandahan nito sa taumbayan, ang laki ng tulong, kasi kung members ang mga Palaweño, pati sila kikita through their patronage fund and interest of share capital,” Concepcion said.

The subsidiary cooperative must not also compete with its parent cooperative and that their businesses should be different from each other. Concepcion also stated that the net worth of the parent must not be below P50 million to qualify.

“PALECO, we can encourage MCO to invest but limited kasi kapag nag-invest tayo sa power generation, bilyon ang pinag-uusapan, kukulangin. I’m thinking of tapping the business sector doon sa participation. Maliban sa addition capital investment, we can seek a loan sa samahan ng cooperative, meron kaming financial administration,” Endriga said.

He explained that after the unanimous vote in 2014, it was not immediately created as it was set aside then. He said they could see the potential now as the renewable energy particularly the solar power has a cheaper price.

Endriga said that PALECO is tapping the local business sector to invest in the subsidiary cooperative with PALECO still holding the majority share.

“Kaya hinahabol ko ngayong December kasi by Janury, ido-double time ko na ito,” he said.

Endriga said that there are many identified investors already for the subsidiary cooperative.

“Very positive ako na maraming gusto mag-invest, gusto na nga nila i-pull out yong deposito nila sa bangko,” Concepcion said.

Endriga and Concepcion both assured that the rate of power to be generated from the subsidiary cooperative would be cheaper.

“So tayo, pwede natin sabihin since atin ito, tayo rin ang makikinabang. Kahit sabihin natin na nine to 10 percent (markup). At least compared to other company, mas mura tayo at the same time yong profit natin, tayo ang makikinabang. Hahati-hatiin natin sa mga MCOs at sa mga business sector na naging partners natin,” he said.

Stephen Tan of William Tan Enterprises Inc (WTEI) who was also present during the meeting said that they are willing to invest even with nine to 10 percent markup.

“Hindi lang naman sa business side pati na rin sa community,” he said.

If the subsidiary cooperative will be formed, it will be named as PALECO Subsidiary Cooperative, Concepcion said.

Endriga said that the subsidiary cooperative might venture into solar energy as it is the easiest to construct in terms of renewable energy.

“The easiest way is to construct renewable energy, solar sa ngayon. Pinakamabilis ‘yan, three to six months in time, plastado na,” he said.

 

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