SOCOTECO II venture with Razon-Pacquiao firm targets 5.5% system loss

The proposed joint venture agreement between the South Cotabato II Electric Cooperative (SOCOTECO II) and Razon-Pacquiao-led Ignite Power seeks to reduce the system loss charges passed on to consumers to 5.5%.

Under the Conditional Joint Venture Agreement, Ignite Power will acquire SOCOTECO II’s distribution assets, with 70% of the payment in cash and the remaining 30% converted into SOCOTECO II’s equity stake in the new distribution firm.

SOCOTECO II Board Treasurer Jessie Alaban said the cooperative is losing more than P40 million monthly, with system losses surging to nearly 14%.

Ignite Power plans to reduce the system loss charge passed on to consumers from SOCOTECO II’s current recoverable cap of 8.25% to 5.5%. It also plans to source competitively priced electricity to help manage generation costs.

“We will first spend our own money to improve services before seeking approval from the ERC for cost recovery,” Ignite Power Information Officer Jonathan Cabrera said in a statement.

Ignite Power is a partnership between Razon-led Primelectric Holdings Inc. and Manny Pacquiao’s MP Holdings.

The proposed partnership is expected to provide SOCOTECO II with new funding to upgrade its distribution infrastructure and improve power reliability.

Ignite Power also plans to finance a five-year modernization program aimed at reducing outages, upgrading equipment and cutting system losses.

SOCOTECO II members will vote next month on the proposed joint venture with Ignite Power, which would determine the future of the cooperative that supplies electricity to General Santos City, Sarangani and parts of South Cotabato.

The plebiscite is scheduled over four weekends: Sept. 5-6, 12-13, 19-20 and 26-27, 2026. — MCG, GMA News