The first years we devoted to putting our house in order by focusing on three areas: first was restoring discipline and enhancing competence among our employees; second was improving our distribution system; and third was rationalizing our fiscal management and accountability.
These were the requisites for our recovery efforts, but we encountered difficulties because of the enormous problems the present administration has inherited. Among these problems are:
· ZANECO’s over-all performance sunk to “C-Rating”in 2005;
· There was 23 million pesos backlog in our tax liabilities for 2003;
· Fiscal deficit was at 88 million pesos;
· The 30 million pesos loan for the payment to the principal account of Fuel Compensating Charge (FCC) and Incremental Cost Charge (ICC) incurred during the power crisis in the 1990s;
· How to seek condonation of the interests of the paid FCC-ICC;
· The sorry state and lack of equipment in our distribution system;
· There was rampant pilferage;
· ZANECO’s motorpool was short of a junkyard;
· No decent facilities to accommodate visiting and paying member-consumers;
· And then the power crisis.
Nevertheless, ZANECO was able to make an astounding turn-around to become what it is today. We were able to hurdle our problems not by charisma, but by seeking consensus and taking actions. Not by building walls, but by bringing our co-workers together. Not by talking too much, but by quiet competence and patience.
From the “C rating” in its performance nine years ago, ZANECO slowly but consistently improved to “B rating” and eventually to “A rating” in National Electrification Administration’s performance assessment in 2012.
On the 23 million pesos backlog of tax liabilities, it was not certain how the past managements such a huge excess. Anyhow, the present ZANECO administration was able to settle this backlog at the Bureau of Internal Revenue, and paid only about 1.8 million pesos. Now, ZANECO’s obligations in taxes are paid on time.
And as the result of our sound fiscal management, ZANECO was able to reduce its deficit from 88 million pesos nine years ago to just four million pesos this year.
Perhaps the biggest achievement so far of the present administration was the condonation last year of the interest of ZANECO’s paid account of FCC-ICC, which by the end of 2012 had already reached more than half a billion pesos.
The 30 million pesos loan from Landbank of the Philippines to pay for the principal account of FCC-ICC was fully paid in May last year. And all these were made without passing a single centavo to the member-consumers.
While struggling with our financial problems, ZANECO continued to focus on its main job of modernizing its equipment and improving the operation and maintenance of its distribution system.
In 2009, ZANECO implemented Area Engineering Concept for the Technical Department’s operation and maintenance works. Unlike the old unsystematic way, the new concept divides linemen and foremen into areas of responsibility thereby eliminating finger pointing in responding to troubles and made maintenance works efficient.
A couple of years ago, ZANECO was able upgrade its Ubay Substation in the Municipality of Polanco from 10 mva to 20 mva. The 10 mva transformer from Ubay is now being rehabilitated and will be installed at the new Irasan Substation in the Municipality of Roxas, which has been using five-mva transformer.
The five-mva transformer from Roxas will likewise be rehabilitated and installed to the new substation in Sindangan, which will also serve nearby Siayan Municipality.
We all know that all of our improvements and development cannot be achieved without strengthening our logistical support. From the aging and barely enough support vehicles and equipment almost a decade ago, the present ZANECO management has now acquired new or refurbished utility vehicles, a boom truck, service vehicles, off-road jeeps, and lately the four 90-foot all-terrain cranes and a wrecker.
The engineering and maintenance crew are also provided with safety gear and equipment.
From the old motorpool, the new and fully equipped motorpool was inaugurated on August 22 last year. It is no longer just a place where our vehicles and equipment are maintained, now it also served as the support hub for our fellow workers in the construction, operations and maintenance.
On the other hand, we have been telling our member-consumers to have a sense of ownership towards ZANECO. But rampant pilferage proved that we can always encounter unscrupulous people everywhere. Four years ago, personnel of a Korean electric company introduced their electric meter to ZANECO, which they bragged was never pilfered in Korea. But after a test at our humble laboratory, the Koreans shook their heads in disbelief after learning that their meter was after all vulnerable to pilferage.
The Korean electric company, aided by two of our engineers, then created and produced pilferage proof meters. We are now using these. We even have started to establish Automated Meter Reading system or AMR, on which our Consumer Account Division can remotely control these new meters.
And aside from AMR system, our wide area network linking all area offices and substations is already operational. With this, member-consumers can pay their bills in any of our area offices. It also enables inter-office monitoring of sales and inventory of supplies.
Meanwhile, ZANECO’s Anti-Pilferage Task Force are diligently doing their job with the help of responsible member-consumers who have been secretly giving us information about pilferage. This has greatly helped in reducing and maintaining our System Loss below the ceiling.
On collection of electric bills, ZANECO’s collection efficiency was at 97 as of December 2013. We achieved this by introducing innovative and efficient collection system. In September 2008, ZANECO introduced “read and bill”. In this new method, meter readers will use high-tech gadgets by which a member-consumer’s bill is immediately printed and served. In due course, the reading, encoding, serving of bills and collection is reduced to just reading and immediate serving of bill. Payments are received by tellers at the main and area offices and through the mobile tellers serving remote areas.
The “mobile teller system” was adopted in 2010. Designated tellers and support staff will go to pre-identified areas in pre-determined day of the month to collect payment of electric bills.
On July 12, 2011, another holistic approach to improve collection was implemented through “FITSTORM,” which stands for Financial, Institutional and Technical – System Loss reduction, Technical upgrading, Operation on collection, Recovery of lost revenue and Miscellaneous order execution.
In this system, groups with combined personnel from Technical, Finance and Institutional Services Departments will go out to designated areas every second Tuesday and Thursday of the month to collect payments, including recovery of lost revenues, and to disconnect overdue accounts.
To accommodate paying member-consumers, ZANECO’s teller area was renovated into a bigger, comfortable, clean and fully automated payment receiving place with 10 teller booths. At the right side are two teller booths dedicated to serve senior citizens and the handicapped.
Comfort rooms at the opposite side of the teller area building now serve member-consumers and visitors. Other offices, like that of the Institutional Services Division, were also rehabilitated and improved to make it presentable and conducive for work.
In Piñan Area Office, an old building was renovated and is now the state-of-the-art multi-purpose hall. It is also the home of ZANECO Power Band, which is a big help in bringing the cooperative closer to its member-consumers.
But no amount of growth of ZANECO will mean anything to our highly critical member-consumers if we continue to have rotational brownouts and worst, manual load dropping. Towards the end of 2011, ZANECO was hit by power curtailment brought by the Mindanao power crisis.
By January 2012, ZANECO was spared by curtailment after it got additional four megawatts from Therma Marine Incorporated and four months later, raising its contract to nine megawatts.
As the Mindanao power crisis is likely to drag until the end of 2015, ZANECO is now signing contracts with companies that are building new coal-fired power plants in Mindanao, particularly Therma South Incorporated and GN Power.
It also signed contracts with New York-based Astronergy, which will build solar power system in Zamboanga del Norte; with EuroHydro company under the Indonesian-based Indophil, which will build our mini-hydro electric power plant in Bergado, Mutia; and with a company that will establish power plant in Dipolog City using bio-mass fuel.
We like to believe that the past years have brought out the best in us. We were not discouraged by our inherited problems and we refused to be intimidated by the power crisis.
Instead, we drew strength from our determination not only to survive, but also to make ZANECO better than what it was before. If we as an electric cooperative have to endure, we must continue with our self-discipline and embrace our calling – to provide efficient and affordable electricity under the umbrella of transparency, fairness and justice.