BUGUIAS, Benguet – Officials of the Benguet Electric Cooperative (BENECO) and the Buguias municipal government recently signed a memorandum of agreement in relation to the development of the 3-megawatt Man-asok minihydro power plant that will be hosted by the town in accordance to existing laws, rules and regulations.
The agreement was signed by Mayor Melchor D. Diclas and BENECO Board President Peter B. Busaing and witnessed by Vice Mayor Ireneo C. Calwag, Councilor Rafael R. Palasi, Sebang Punong Barangay Benido T. Magan and Indigenous Peoples Mandatory Representative Benjamin G. Palbusa for the local government and BENECO General Manager Gerard P. Verzosa, Board of Director Fr. Jonathan Obar of District II and Engr. Ricardo S. Pallogan, BENECO power generation operations manager, for the electric cooperative.
BENECO is currently developing the run of river minihydroelectric power plant located in the municipality with an installed capacity of 3 megawatts and that the same is defined under Section 4(y) of Republic Act No. 9513 otherwise known as the Renewable Energy Act of 2008.
Under the said law, the government share on existing and new renewable energy development projects shall be equal to 1 percent of the gross income of renewable energy resource developers resulting from the sale of renewable energy produced and such other income incidental to and arising from the renewable energy generation, transmission and sale of electric power.
Further, the government share as required under the law shall be distributed as follows, national government – 60 percent and local government – 40 percent
Pursuant to Section 292 of RA No. 7160 and Department of Energy Circular No. 2009-05-0008, the allocation and distribution of the local government share shall be province – 20 percent, component city or municipality – 45 and barangay – 35 percent. Aside from the government share imposed under the Renewable Energy Act of 2008, RA 9136 or the Eletric Power Industry Reform Act (EPIRA) of 2001 likewise mandated for the provision of direct benefits to the local government units hosting the generation facilities.
BENECO, in recognition of its obligation of sharing with its host communities a part of income to be derived from the operation of the 3-megawatt minihyroelectric power plant, and in consideration of the exploitation, development and utilization of naturally-occurring renewable energy resources within the territory of the municipality.
Based on the agreement, a joint venture or partnership agreement between BENECOP and the municipality shall be executed with a 50-50 percent sharing of ownership of the facilities after the 26th year of operation of the minihydro plant without any initial financial investment to be cashed out by the municipality.
In addition to complying with the requirements of the related laws, BENECO undertakes and binds itself to deliver to the municipality one centavo per kilowatthour of the power generated and delivered by the 3-megawatt minihydroelectric plant as additional financial benefit to the municipality and the amount shall be paid to the municipality within thirty days from the billing date of the electric cooperative to its consumers and that the amount shall be increased by P0.005 per kilowatthour of the power generation every five years. Should any law, ordinance or regulation be passed, enacted or promulgated in the future regulating BENECO to make payments to the municipality, the amount paid in compliance with such future law, ordinance or regulation shall be credited against the payments.
BENECO shall extend preference in employment opportunities during construction and operation of the power plant to bonafide of the municipality, provided, however, that employment vacancies exist and such residents are qualified, competent and physically fit for the positions applied for, in accordance with the employment guidelines set forth by the cooperative.
At the same time, BENECO shall include in the terms of reference for the bidding of the construction of the project that the municipality’s qualified and skilled workers and laborers be prioritized in the recruitment for the project’s construction and operation.
BENECO committed to provide various programs for the benefit of the people of Buguias.
Prior to the operation of the minihyro plant, the cooperative shall provide the municipality closed-circuit television cameras to be used by its municipal police station.
Moreover, it will also provide two units of motorcycles for various uses.
BENECO shall also prioritize the extension of power lines to unenergized public schools in the municipality and likewise donate computers to the different schools and provide free electrical wiring of public schools.
BENECO was mandated to conducted once a year medical and dental missions within the municipality in coordination with the municipal health office.
To minimize adverse impact of the plant to the needs of farmers for irrigation, BENECO will not construct any tunnel to divert water sources and that it shall commit to give preferential rights to the farmers for irrigation purposes and shall abide with the requirements of the National Water Resources Board.
BENECO shall regularly deposit in a restricted fund the amount equivalent to P0.01 per kilowatthour of the power plant production to finance corporate social responsibility programs and activities in the town.
In compliance with DAO No. 2004-59, BENECO shall allocate P0.005 per kilowatthour to be deposited in a bank to fund measures to protect and preserve the forest and water resources within the territorial jurisdiction of the municipality, including specifically those areas relevant to the 3-megawatt plant.
By Dexter A. See
