Meralco seeks more electric co-op partnerships

Manila Electric Co. is open to supporting more electric cooperatives in other parts of the Philippines, including Mindoro, Albay, and Davao de Oro, through equity investments, while it pursues planned capital infusions into Batangas Electric Cooperative Inc. I, Batangas Electric Cooperative Inc. II, and South Cotabato II Electric Cooperative.

In a roundtable discussion with reporters on Tuesday, April 7, Atty. Arnel Casanova, senior vice president and head of Meralco’s strategic DU partnerships, said the company is focused on BATELEC I, BATELEC II, and SOCOTECO II, but remains open to working with other cooperatives that need help.

“Other areas like Mindoro, like Albay, like Davao de Oro — these areas, they would really need help. So, they reached out to us, but it would require the board of directors and the management to be open to it,” he said.

Casanova said Meralco’s proposal is not a takeover, but a partnership meant to strengthen electric cooperatives and improve service for consumers.

“We’re not saying that when we go there, they commit to us already, but at least to hear Meralco’s proposal and how it can benefit them and empower them as electric cooperatives,” he added.

He said Meralco does not intend to displace the cooperatives, but to come in as an investor that can help upgrade systems and personnel.

“We are just an investor. We’re going to upgrade the skills and the capabilities of their employees,” he stressed.

Casanova said Meralco would take a controlling stake in partner cooperatives because the scale of the needed improvements — including substations, lines, smart grids, and a supervisory control and data acquisition system — would require billions in investment.

He said that despite the planned equity infusion, local management would continue to handle day-to-day operations.

Casanova framed the initiative as part of a broader effort to expand reliable and quality power service beyond Meralco’s franchise area and support economic growth in underserved regions.

“We see this opportunity as really a nation-building opportunity. Because if we provide reliable and quality power to the rest of the country, our economy will grow. We will build our manufacturing industrial base,” the Meralco official said.

He said the economic gap between Meralco’s franchise area and many other parts of the country underscores the need for stronger electricity service.

According to Casanova, the current GDP per capita within Meralco’s franchise is around PHP 500,000 annually, compared with PHP 150,000 to PHP 200,000 in other regions, a gap of roughly PHP 300,000.

“We want to narrow that inequality,” he said.

Meralco is also urging BATELEC I, BATELEC II, and SOCOTECO II to conduct a competitive public bidding among power companies, including Meralco, so member-consumers can choose the proposal that best serves their interests.

Casanova said the bidding process would be supervised and approved by the National Electrification Administration, the government agency that oversees electric cooperatives.

Once a winning bidder is selected, he said, the Energy Regulatory Commission would review and approve any proposal to adjust electricity rates, particularly for distribution, supply, and metering services.

The structure being pitched by Meralco comes as policymakers continue to look at private sector participation as one way to improve weaker or financially stressed electric cooperatives, especially those facing aging infrastructure, service reliability issues, and limited capital for modernization.

NEA rules allow electric cooperatives, with agency guidance, to enter private sector participation arrangements such as joint ventures and related investment frameworks, while the ERC regulates distribution utilities and sets the process for reviewing distribution, supply, and metering charges.