Mindanao, the southernmost island of the Philippines, is grappling with a paradox: despite possessing abundant power resources, it frequently faces power shortages and blackouts. This anomaly stems from a combination of outdated infrastructure, inefficient electric cooperatives (ECs), and systemic challenges that hinder the region’s economic potential.
Mindanao’s growth engines
In 2024, Northern Mindanao emerged as one of the region’s brightest performers, expanding by 6% and officially joining the ranks of trillion-peso economies with a gross regional domestic product (GRDP) of ₱1.04 trillion. The upswing was powered by a surge in construction, wholesale and retail trade, and manufacturing.
Davao Region, meanwhile, held its ground with 6.3% growth and a GRDP of ₱1.08 trillion, cementing its position as the fourth-largest regional economy in the Philippines.
Mindanao Development Authority (MinDA) Chair Secretary Leo Tereso A. Magno mentioned that Mindanao’s economic momentum in 2025 will be driven by agribusiness, renewable energy, infrastructure, and tourism.
Agribusiness is shifting toward value-added processing and high-value crops, while renewable projects in solar, hydro, and biomass strengthen the island’s energy surplus. Major infrastructure upgrades are improving connectivity, and a safer image is helping tourism fuel gains in services and local enterprise.
The paradox of power surplus and frequent blackouts
As Mindanao’s economy grows, its energy demand is also rising. Thankfully, the region’s average demand of 2,297 megawatts (MW) remains below its available capacity of 3,406 MW, leaving a daily reserve of 1,110 MW.
According to Minda News, Mindanao’s power plants generate well over 2,900 MW daily, allowing around 400 MW of surplus electricity to be transmitted to the Visayas grid through the interconnection system.
Despite this surplus, blackouts persist across many communities. According to Assistant Secretary Romeo Montenegro, MinDA Deputy Executive Director, the problem lies not in generation but in the fragile web of distribution lines run by local ECs. Many of these networks, built years ago for smaller loads, are now strained by higher volumes of power they were never designed to carry.
“Electric cooperatives must make necessary corresponding investments and adjustments as well as these transmission assets to address load fluctuation,” Montenegro explained.
Voltage fluctuations, unstable frequencies, and overloaded lines translate into outages and appliance damage for consumers. Montenegro stressed that development partners are being tapped to provide training, financing, and technical support, but without major investment in distribution assets, blackouts are unlikely to disappear.
(Also read: Renewable Energy Policies Crafting a Better Tomorrow)
ECs struggle to deliver
In Mindanao, several ECs face persistent operational challenges that have contributed to recurring power interruptions.
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Misamis Oriental II Rural Electric Service Cooperative (Moresco II)
Talisayan Mayor Ciriaco Talines recently pressed Moresco II to improve its services, warning that unreliable electricity is undermining livelihoods and local commerce. Neighboring towns, including Gingoog City, have reported similar frustrations over the instability of supply.
First District Representative Jennifer “Karen” Lagbas raised the issue before the House Committee on Energy, stressing that Moresco II and other struggling ECs require urgent support to modernize their distribution systems.
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Lanao del Sur Electric Cooperative (Lasureco) and Maguindanao Electric Cooperative (Magelco)
In a landmark move in 2022, the Department of Finance (DOF) ordered the disconnection of Lasureco from the grid and the restriction of Magelco over ₱16 billion in unpaid debts. The government cited chronic financial mismanagement and poor collection efficiency as major culprits, rejecting any notion that the Power Sector Assets and Liabilities Management Corporation (PSALM) should subsidize these ECs’ operations.
As of early 2022, Magelco had only partially settled its dues, covering barely a third of its power bill, while Lasureco’s arrears ballooned to nearly ₱13 billion with no clear repayment plan in sight.
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Siargao Electric Cooperative (Siarelco)
Siarelco faced strong criticism from business owners and residents after repeated blackouts highlighted persistent inefficiencies. In focus group discussions by consumer group ILAW, those in the hospitality and food sectors gave the cooperative an average score of 4.6 out of 10, blaming unstable power supply and losses of up to ₱100,000 per incident.
The problem was evident earlier in December 2024, when the island endured almost a week without electricity after a fault disrupted its submarine cable connection to the energy supply. The outage forced 21 tourist establishments to close, cut off water in many households, and led the Surigao del Norte Provincial Board to declare a state of calamity on December 10.
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North Davao Electric Cooperative (Nordeco)
Consumer groups and lawmakers have repeatedly called out Nordeco for poor service and costly power rates that hinder economic activity. Congress found Nordeco charging ₱3 to ₱5 more per kWh, with customers suffering four hours of outages monthly against Davao Light’s 17 minutes.
Samal Island, a prime tourist destination, has struggled with Nordeco’s unreliable service since 2021. Recurring outages have translated into annual economic losses of ₱120 to ₱150 million, with the tourism sector alone losing about ₱50 million each year.
However, the landscape may soon change as House Bill 11072, which became law on April 6, expands Davao Light’s franchise to cover Tagum City, Samal Island, parts of Davao del Norte, and all of Davao de Oro—areas currently under Nordeco.
(Also read: Why Davao Needs Reliable Power Now)
Fixing the power gap
ECs are sustained by taxpayer money, yet their inefficiencies remain glaring. Financial mismanagement, poor collection performance, and failure to modernize distribution systems have left many unable to keep up with growing demand. Unless these weaknesses are addressed, the cycle of outages and lost opportunities will continue to hold Mindanao back.
Mindanao’s vast energy resources should be a springboard for growth, not a recurring source of frustration. To unlock its full potential, the region must push forward with energy projects, improve transmission and distribution networks, and enforce accountability among power distributors.
Only by addressing these deep-seated issues can Mindanao build a power system capable of supporting its ambitions—a system that delivers reliable electricity, attracts investment, and improves the daily lives of its people.
Sources:
https://rsso11.psa.gov.ph/content/davao-regions-economy-posts-63-percent-growth-2024
https://www.sunstar.com.ph/davao/davao-4th-fastest-growing-region
https://www.bworldonline.com/the-nation/2025/01/05/644784/minda-cites-key-drivers-for-growth
https://www.sunstar.com.ph/davao/mindanao-power-supply-stable-throughout-2025
https://mindanaogoldstardaily.com/archives/151927
https://manilastandard.net/spotlight/314570335
https://www.sunstar.com.ph/davao/davao-light-franchise-expansion-becomes-law
