Home » , , » NEA lends P24M to Siarelco to improve facilities

NEA lends P24M to Siarelco to improve facilities

The Energy Regulatory Commission (ERC) has allowed the National Electrification Administration (NEA) to lend P24 million to Siargao Island Electric Cooperative Inc. (Siarelco).

“The loan to be secured by Siarelco — which services the electricity needs of Siargao Island in the province of Surigao del Norte — from the NEA will redound to the benefit of its customers in terms of continuous, reliable, and efficient power supply," according to ERC.

The proceeds of the loan would be used by Siarelco to finance its capital expenses from 2009 to 2011, ERC said.

Siarelco’s capital expenditures for the three-year period include the upgrade of power lines, replacement of electric wooden poles and inefficient transformers, inter-looping of power system, and the acquisition of a substation circuit breaker.

In April this year, Siarelco said its customers had to suffer a week-long blackout due to failure of its underwater power cables.

Based on the approved loan terms with NEA, Siarelco will pay within 15 years at an initial interest rate of 4.5 percent.

The succeeding rates after the first release will be nine percent annually, ERC noted.

NEA is an attached agency of the Department of Energy that is tasked to provide financial, technical, institutional, and supervisory functions over electric cooperatives.

NEA has so far lent over P6 billion worth of loans to a number of electric cooperatives across the country.

There are 119 electric cooperatives nationwide, most of them serving some far-flung areas not serviced by big power distribution utilities. - Jesse Edep/KBK, GMANews.TV

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