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Alcantara, Zambo co-op reach compromise deal

Crowninvestments Holdings Inc. and Desco Inc. Investment Holdings Inc., the investor manager of the Zamboanga Electric Cooperative, have forged a compromise agreement with Western Mindanao Power Corp. to pave the way for a stable power supply in Zamboanga City.

Crown-Desco agreed to pay WMPC of the Alcantara Group its past due accounts for October and November 2018 amounting to ₱220 million after a hearing at the Energy Regulatory Commission on April 25 on the petition of the power supplier to resolve the dispute.

“The ERC convinced the parties to enter into a compromise for a period of 60 days. We have been asked to pay partially two invoices that are pending. In the meantime, WMPC will run their power plant during this compromise situation, which dramatically lessens the frequency of brownouts,” said Crown representative Jomar Castillo.

ERC director for legal services Gregorio Ofalsa, the appointed hearing officer on the dispute resolution case, summoned the lawyers of the opposing camps and ordered a recess for over one hour for the parties to resolve power outages in the city without compromising their respective petitions. 

After the recess, both parties agreed to resume the supply to power to Zamcelco for a period of 60 days effective April 29, or upon receipt of payment from the Crown-Desco joint venture.  

The two parties also agreed to put into writing the compromise agreement by Monday when ERC hearing officer Ofalsa will issue a 60-day status quo ante order.

This is Crown’s third offer of partial payment to cover for WMPC’s operational and fuel costs. It made the first offer of P150 million in February. The second offer was P220 million pesos made on April 3. WMPC rejected both offers. WMPC is owned by the 

Crown-Desco, which took over management of Zamcelco in January, earlier questioned the effectivity of the Zamcelco-WMPC power supply contract and used it as basis for withholding payment to WMPC. 

“WMPC is committed to resolving the ongoing power crisis in order to provide the people of Zamboanga City with access to stable power supply and thus ensure access to basic services, security in the region and the conduct of peaceful elections. This was the overriding consideration in agreeing to a compromise amount of ₱220 million even if Zamcelco’s past due accounts have now reached ₱467 million,” a WMPC official said.

WMPC earlier filed a petition with the ERC seeking relief from the refusal of Crown to pay past due accounts that reached ₱467 million from October in 2108 to February 4, 2019, when WMPC’s 105-megawatt bunker fuel-fired power plant in Sangali, Zamboanga City stopped operating due to a critical fuel supply level.

The compromise was reached pending the resolution of the dispute between the co-op and the power supplier.

Topics: Crowninvestments Holdings Inc. , Desco Inc. , Zamboanga Electric Cooperative , Western Mindanao Power Corp.
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