By Philippine Cooperativunion
WHILE MILLIONS of Filipinos have been suffering from the spiraling costs of electricity, more than half a million member-consumers of seven electric cooperatives in the country have actually been enjoying a monthly power rate cut of as much as 78 centavos per kilowatt hour since August this year.
This translates to a power rate reduction of P78 per month in the electricity bills of small households consuming 100 kilowatt-hours (kwH) or P780 per month for businesses consuming 1,000 kilowatt-hours.
According to Association of Philippine Electric Cooperatives (APEC) Partylist Congressman Ponciano Payuyo, an additional half a million member-consumers of five additional electric cooperatives will also soon enjoy lower electricity bills through similar power rate reductions before the end of this year after they secure their respective certificate of tax exemption from the Bureau of Internal Revenue (BIR).
Payuyo explained that the power rate cuts stem from the tax exemption privileges that are given to the 12 electric cooperatives which are registered with the Cooperative Development Authority (CDA) under Republic Act 9520, otherwise known as the Philippine Cooperative Code of 2008.
“All tax exemption privileges enjoyed by CDA-registered electric cooperatives are passed on to our member-consumers in the form of power rate reductions,” explained Payuyo, an accountant by profession, who was General Manager of the Palawan Electric Cooperative (PALECO) prior to his assumption as APEC partylist representative.
Payuyo said that the 106 electric cooperatives that opted to stay with the National Electrification Administration (NEA) are not entitled to the tax exemption privileges granted to CDA-registered electric cooperatives because they are not true cooperatives owned by their members.
He explained that Article 130 of RA 9520 states that, “Electric cooperatives registered with the NEA under Presidential Decree No. 269, as amended which opt not to register with the (CDA) are allowed to retain the word ‘cooperative’ in their registered names; Provided, that they shall not be entitled to the benefits and privileges under this Code.”
Payuyo said that the tax exemption privileges under RA 9520 cover all taxes and fees including the 12 percent value-added tax (VAT), local business tax, income tax, real property tax, franchise tax, import tax, etc.
He also quoted Article 60 of RA 9520 on the Tax Treatment of Cooperatives which states that, “Duly registered cooperatives under this Code which do not transact any business with non-members or the general public shall not be subject to any taxes and fees imposed under the internal revenue laws and other tax laws.”
He said the tax exemption of the 12 CDA-registered electric coops give them savings that are passed on to their members as monthly power rate cuts, as follows:
Palawan Electric Cooperative (PALECO) – 40 centavos per kilowatt-hour
Pangasinan Electric Cooperative 1 (PANELCO-1) - 78 centavos per kilowatt-hour
Pangasinan Electric Cooperative 3 (PANELCO-3) - 4 centavos per kilowatt-hour
San Jose City Electric Cooperative (SAJELCO) - 27 centavos per kilowatt-hour
Sorsogon Electric Cooperative 2 (SORECO-2) - 65 centavos per kilowatt-hour
Nueva Vizcaya Electric Cooperative (NUVELCO) - 28 centavos per kilowatt-hour
Negros Occidental Electric Cooperative (NOCECO) - 70 centavos per kilowatt-hour
He said the member-consumers of the 106 electric cooperatives who opted to stay with NEA may enjoy similar electricity rate cuts and lower monthly electricity bills if they register with the CDA.
Because of this, Payuyo said he is encouraging all member-consumers of NEA-registered electric cooperatives as well as new distribution utilities to register with the CDA “in order for them to earn the right to avail of tax exemptions and other privileges under RA 9520 and thus, bring down their monthly electricity bills.”
He cited the case of the Agusan del Norte Electric Cooperative (ANECO) whose member-consumers recently voted to register with the CDA through a referendum in 15 districts as provided under Article 127 of RA 9520. “While RA 9520 only requires the affirmative votes of 20 percent of all members in good standing, 31,000 member-consumers, or nearly 30 percent ANECO’s 110,000 membership base, voted to register with CDA,” Payuyo said.
He said ANECO’s management and board of directors are now accountable to their members under the principle of democratic member control of RA 9520. “As proof of their ownership of ANECO, members will be issued share capital certificates reflecting their contributions to the coop,” Payuyo said.” ###