ECs needs reinvestment funds - ERC

The Energy Regulatory Commission (ERC) presently authorizes electric cooperatives (ECs) to collect a reinvestment fund of five percent (5%) from its member-consumers.

Reacting to a press statement made by NASECORE, the Commission emphasized the need for ECs to generate funds for capital-intensive repairs, maintenance and expansion of facilities to deliver high quality, reliable and sufficient electric service.

ERC Chairman Manuel R. Sanchez said that “the purpose of the funds is specific and there are guidelines for its disbursement. We urge consumer-members of coops to help us monitor the compliance of their respective coops to the established rules. Their vigilance will prevent anomalous transactions from taking place.”

ECs are non-profit power utilities that are granted revenue-neutral rates by ERC. As such, these establishments rely heavily on the reinvested funds to sustain a viable operation. Said funds are augmented by loans granted by various institutions including government.

“It will be more harmful to the ECs to be left without funds to meet contingencies such as power shortages. Financial resources must also be readily available to fund long-term expansion plans,” Sanchez said.

August 21, 2003