QuestionsQuestions (NEA POLICY ON ELECTRIC COOPERATIVES)
The NEA Policy is anchored on the pursuit of total electrification through electric cooperatives by enhancing distribution development under RA 10531, but it requires consideration of climate change impacts. The policy declares that the new “normal” from climate change must be incorporated into the design and construction of EC distribution systems.
Natural disasters and calamities brought by force majeure events such as typhoons, storms, and tropical depressions (which can increase in intensity), as well as man-made calamities/disasters due to fortuitous events like war, sabotage, and insurrection (e.g., the Zamboanga siege).
Force majeure is an event resulting from elements of nature that cannot be reasonably anticipated or controlled, such as a typhoon, storm, tropical depression, flood, drought, volcanic eruption, earthquake, tidal wave, or landslide.
Fortuitous event refers to an act of war (declared or undeclared), sabotage, blockade, revolution, riot, insurrection, civil commotion, or any violent or threatening action.
The objectives are: (1) ensure availability of vital materials/equipment for immediate restoration/rehabilitation; (2) establish ample stock for emergency rehabilitation/restoration; and (3) ensure specifications conform to the “Build Back Better” scheme.
It means reconstruction/restoration of the lines stronger than the old/damaged structure. Lines should be designed and constructed with primary consideration on material strength and shorter spanning of the distribution line structure.
Poles, insulated conductors, distribution transformers, electronic kWh meters, and service wires.
Quantity is equivalent to 2%–6%, 10%, and 20% of the ECs linear kilometer of three-phase (3I) distribution length of lines, as specified in the policy mechanics.
Costing of buffer stock is based on the NEA Material Price Index, ensuring that the financial estimates reflect standardized and updated material pricing.
Insulated Conductor #4/0 ACSR and Bare conductor #2/0 ACSR are used; and steel poles are used for this purpose, equivalent to Class 3 wood poles.
ECs must: (1) build a pool of linemen/electricians regionally; (2) establish buffer stock of specified materials/equipment; (3) prepare designs under “Build Back Better”; (4) adopt regional procurement through the regional association; and (5) identify cost recovery for buffer stock and mobilization.
ECs must build a pool of linemen and electricians on a regional basis to perform emergency power restoration during calamities and also handle sitio and household electrification projects in normal times.
ECs must establish a fund for buffer stock, mobilization, and attributable costs/expenses for immediate restoration due to force majeure/fortuitous events. Buffer stock and related expenses are submitted to ERC as part of the CAPEX Plan and/or sourced from RFSC (additional). NEA may provide a loan to ECs to finance buffer stocks and attributable costs.
They are submitted to NEA Engineering for evaluation, then to the Deputy Administrator for Electric Distribution Utilities Services for approval. The NEA-approved proposal becomes part of the EC’s submission to the ERC. After ERC approval, related procurement steps must follow.
Procurement must be regional. Each EC determines its buffer requirements; the regional association must create a BAC composed of member ECs; bidding for total regional requirements must be centralized and published in a national newspaper; the terms of reference must be submitted to NEA for approval; contracts are made individually or between each EC and the supplier; delivery is per EC; and each EC must have a Board Resolution authorizing the regional association to purchase for it.
Bidding procedure must be in accordance with NEA Memorandum No. 2005-030 (Procurement Guidelines for Electric Cooperatives) dated 07 October 2005.
Replenishment is made when 50% of material utilization has been reached.
It takes effect fifteen (15) days immediately following publication in a newspaper of general circulation and the filing of three (3) copies with the University of the Philippines (UP) Law Center pursuant to Presidential Memorandum Circular No. 11 dated 09 October 1992.