IN April 2025, the long-suffering consumers of provincial Davao were finally granted some relief from terrible electricity service and even worse management on the part of the Northern Davao Electric Cooperative Inc. (Nordeco) with the passage of Republic Act (RA) 12144, which effectively canceled Nordeco’s franchise and turned over the area under a new franchise to the Davao Light and Power Co. (DLPC). What has transpired since has been nothing short of open rebellion against the laws of the Republic on the part of the leadership of Nordeco as they desperately cling to power (no pun intended), fighting through every legal and extralegal means they can think of to keep the cooperative from suffering its long-deserved dissolution. And so far, it seems that every responsible agency — the Department of Energy (DOE), the National Electrification Administration (NEA), and the Energy Regulatory Commission (ERC) — is either unable, or unwilling, to do what is already legally mandated and put Nordeco out of business once and for all.
DLPC is a part of the Aboitiz Power family, and the nation’s third-largest distribution utility (after Meralco and Visayan Electric), and it supplies power to Davao City, Panabo City, and the Davao del Norte municipalities of Carmen, Dujali, and Santo Tomas. Nordeco’s former franchise, now in the hands of DLPC, included Tagum City and the Island Garden City of Samal — or Igacos, as it’s referred to in shorthand — along with just about all of the rest of Davao del Norte, and 10 municipalities in Davao de Oro (aka Compostela Valley).
There had been grumblings about Nordeco’s poor performance for years, but things really came to a head in mid-2023, when Igacos found itself without power for hours on end every day, prompting city officials to declare a local state of emergency. Other parts of Nordeco’s franchise area, particularly in and around Tagum, took the cue to also begin clamoring for change. RA 12144 passed without too much difficulty in April last year, and was immediately challenged before the Supreme Court, which upheld the legality of the dissolution of Nordeco’s franchise and the new one for DLPC on Jan. 14 of this year.
Under the terms of RA 12144, Nordeco was granted a maximum of two years as a transition period to turn over its distribution equipment and business to DLPC. DLPC was directed to compensate Nordeco at fair market value for any assets it took over, and to give preference to Nordeco employees in hiring for technical or administrative jobs. The DOE was directed to ensure that Nordeco’s customers would have a continuous supply of electricity during the transition, and the ERC was instructed to issue any necessary provisional permit to Nordeco (since it no longer had the legal authority to provide electricity service) to keep the lights on until the transition was complete.
However, DLPC said that, with almost 10 of the 24-month prescribed transition period gone, Nordeco had fought tooth and nail to obstruct the handover. So far, DLPC has only done work in one area, Tagum City — a bit of a cheeky move, in my opinion, since Nordeco’s head office is located there — where it has installed new substations and distribution lines, but has yet to be able to supply many customers due to Nordeco’s interference.
The latest development happened on Feb. 25, when DLPC moved to take control of the Igacos area, having had to seek court relief to see that the terms of RA 12144 are enforced. The Regional Trial Court of Panabo City issued a Notice to Vacate and Writ of Possession in favor of DLPC on Feb. 24, and so the next day, armed with a legal court order, DLPC arrived at the Igacos offices of Nordeco to evict the cooperative and take over operations in the area, in the company of the sheriff detailed by the court to enforce the order.
Nordeco, of course, immediately issued a whiny press release decrying the action as “totally illegal,” and “participated by political leaders promoting their 2028 agenda,” while also claiming that the Supreme Court case last year involving MORE Power in Iloilo and the Iloilo Electric Cooperative Inc. (Ileco) allowed for “overlapping” franchises. This implies that Nordeco could still operate and that the court-ordered seizure of its offices and distribution assets in the area was illegitimate. Nordeco also complained that its motion for reconsideration of the Feb. 24 order had not yet been decided, and therefore concluded that the action should not have been taken, but that is not how courts work here.
Let me cut to the chase here. The legal maneuvering is complete BS, as is Nordeco’s pretention that it still has a valid franchise. And all of that conveniently ignores the fact that Nordeco’s own customers don’t want it. Even if they have to pay slightly higher electricity rates (which does not even seem to be the case, as far as I can determine), their very reasonable expectation for reliable electricity service trumps the consideration of costs, or the Nordeco leadership’s (who, by the way, are supported by the thoroughly misguided Philippine Rural Electric Cooperatives Association, or Philreca) misguided notions of the sacred permanence of electric cooperative franchises.
To understand and form a correct conclusion about what’s going on, it may be helpful to look at this from DLPC’s point of view. Although I have problems with the notion of “congressional franchises,” which I have explained at various times, that is the prevailing law. Under that law, DLPC now has a responsibility to provide electricity to end-users according to reasonable standards, and “the co-op that we’re taking over from is not cooperating” is not really a legitimate excuse for not being able to do that.
Unfortunately, DLPC seems to be between a rock and a hard place to some extent in terms of being supported by the government in carrying out the law, passed by the government, and meeting its responsibilities. So far, the DOE has not intervened, and it is unclear how it could in the context of RA 12144. Likewise, the ERC has yet to intervene, but in its case, it may not be able to until the two-year prescriptive period for the transition expires. The NEA, while only having quasi-regulatory functions, could still act to force, or at least strongly encourage, Nordeco to comply, but it has not so far.
Where things go from here, I don’t know. My opinion is that the NEA should step in, and take over Nordeco’s management in order to facilitate the transition. It certainly has the authority to do so, and could easily justify it by Nordeco’s failure to comply with the law. Why it has not is something the NEA leadership should explain.
ben.kritz@manilatimes.net
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