Davao Light vs NORDECO: A Long-Awaited Power Shift Promises Reliable Service for Consumers

January 30, 2026
Balitang Mindanao
Public Policy
0

The ongoing debate over electric distribution services in the Davao Region, particularly between the Davao Light and Power Company, Inc. (Davao Light) and the Northern Davao Electric Cooperative, Inc. (NORDECO), has evolved into one of the most consequential infrastructure and consumer welfare issues in recent Mindanao history. It centers on service reliability, electricity rates, legal legitimacy, consumer choice, and financial transparency among electric cooperatives (ECs) and private utilities.

Davao Light ranks as the Philippines’ third-largest electric distribution utility, operating under a legislative franchise to deliver electricity across Davao City. Its service footprint also extends beyond the city, covering Panabo City and the neighboring municipalities of Carmen, Dujali, and Sto. Tomas in Davao del Norte.

Meanwhile, NORDECO was established in 1971 as the Davao del Norte Electric Cooperative and was renamed Northern Davao Electric Cooperative. As a member‑owned, rural electrification institution under the various electricity reform laws, it historically delivered power to underserved, agricultural, and low‑income areas of Davao del Norte and Davao de Oro.

The core of the present controversy is a legislative and regulatory shift that seeks to expand Davao Light’s franchise into areas currently and historically served by NORDECO. While many community stakeholders view this as a path to modernized infrastructure and lower rates, NORDECO and its supporters see it as a threat to their rights and cooperative model.

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A Timeline of the Dispute

The dispute did not unfold overnight; it evolved through a series of key moments that, taken together, explain how the issue between the parties developed.

2023 – Early 2024: Early Friction and Consumer Discontent

Grievances against NORDECO’s service reliability were noted well before the formal legislative battle. In April 2024, Davao del Norte’s First District Representative Pantaleon Alvarez declared that NORDECO’s service was “expensive, not reliable, and unreasonable,” urging discontinuation should performance fail to improve.

By this period, local leaders in the Island Garden City of Samal (Igacos) had also publicly challenged NORDECO to address chronic power interruptions, highlighting the social and economic costs borne by businesses and residents.

Meanwhile, Senator Christopher Lawrence “Bong” Go said the ongoing power crisis has significantly affected tourism in the Island Garden City of Samal (Igacos). He warned that the island’s tourism potential is being undermined by rotational power outages, which continue to disrupt businesses and visitor activities.

2024–2025: Legislative Efforts and Legal Challenges

During a Senate plenary session in January, Senator Juan Miguel Zubiri highlighted wide gaps between NORDECO and Davao Light in both pricing and reliability. He noted that electricity rates under NORDECO were about ₱3 to ₱4 per kilowatt hour (kWh) higher. Citing Department of Energy (DOE) data, Zubiri said Davao Light recorded an average of 17 minutes per month, while NORDECO experienced about 242 minutes of outages each month.

The disparity extended to outage frequency. Davao Light averaged around three power interruptions annually, while NORDECO faced nearly five outages every month. Senators Zubiri and Aquilino “Koko” Pimentel III were reported to have questioned how NORDECO received a Double A rating from the National Electrification Administration (NEA) despite its service record.

The first major legislative move occurred when bills (House Bill 11072 and Senate Bill 2888) were introduced to amend electric franchise areas to include the territories of NORDECO under Davao Light’s franchise. NORDECO immediately contested these measures, arguing that such expansion would unlawfully impair its existing contractual franchise rights protected under the Constitution and the Electric Power Industry Reform Act (EPIRA). Nordeco’s leadership appealed directly to the President to veto the bill.

Despite these protests, Republic Act 12144 ultimately lapsed into law on April 6, 2025, as the President did not sign or veto within the constitutional period. This law formally expanded Davao Light’s franchise area to include Tagum City, Samal Island (Igacos), and portions of Davao del Norte and Davao de Oro previously under NORDECO.

NORDECO promptly filed legal challenges in the Supreme Court, including a petition for certiorari and prohibition, asserting that RA 12144 is constitutionally flawed and requesting that the implementation be halted pending judicial review.

The EC also reiterated its intention to remain fully operational, stressing that the law does not immediately terminate its franchise and that it would pursue all legal remedies to defend its rights.

Mid‑2025: Public Pushback and Persistent Inefficiencies

In a May 2025 survey commissioned by the Davao Consumer Movement (DCM), the majority of residents in Davao del Norte and Davao de Oro expressed strong support for the expansion of Davao Light. The survey cited years of allegedly unreliable service and high electricity costs under NORDECO as key reasons for backing the change.

According to the results, almost 98% of respondents in Davao del Norte and 80% in Davao de Oro favored Davao Light’s entry.

A few months later, in August, DCM criticized NORDECO’s attempt to renew its franchise, describing it as disregarding the preferences of consumers.

In September, Governor Edwin I. Jubahib secured approval from the Provincial Development and Peace and Order Councils to create a Special Inspection Team to review major national projects in Davao del Norte. NORDECO was among the key concerns, with the councils requesting a financial report on a reported ₱1-billion submarine cable loan connecting Pantukan and the Island Garden City of Samal (Samal), and urging the Senate Blue Ribbon Committee to investigate.

Samal Mayor Al David Uy warned that ongoing power issues could magnify financial losses, estimating annual damages at ₱50 million in tourism, ₱30 million in commerce, ₱50 million for households, ₱10 million for public services, and ₱20 million in agriculture and fisheries.

Late 2025: WESM Controversy & ERC Provisional Approval

Amid the broader franchise dispute, NORDECO was suspended from participating in the Wholesale Electricity Spot Market (WESM), effective September 25, 2025, due to unpaid energy settlement obligations under WESM rules.

The Independent Electricity Market Operator of the Philippines (IEMOP) publicly posted the suspension notice, which states that the suspension will remain in effect until the cause is rectified and formally lifted. Consumer advocates and business groups reported that NORDECO’s unpaid WESM bills had ballooned into P318.4 million, and warned that losing WESM access could limit the cooperative’s ability to secure affordable power and meet peak demand.

NORDECO has denied the suspension notices circulating in the media and social platforms, calling them “misleading” and urging members to ignore them despite the official market operator’s published notice.

December 2025 – January 2026: Regulatory Green Light

The dispute took a significant turn in December 2025 during an Energy Regulatory Commission (ERC) en banc meeting. The ERC granted Provisional Approval to Davao Light for its Certificate of Public Convenience and Necessity (CPCN), allowing the company to begin connecting new customers in the newly expanded franchise areas, even as final approval remains pending.

The expansion has not quelled contention. NORDECP continues to caution its member‑consumers against transferring service to Davao Light, emphasizing that the CPCN is still provisional and subject to legal and regulatory review. Meanwhile, a Regional Trial Court in Panabo City issued a Writ of Possession in favor of Davao Light, allowing the company to assume control of power distribution in Samal — a key step in the transition process.

Consumers have noted that the January 11 to February 10, 2026, billing period, Davao Light’s residential rate rose to ₱11.72 per kWh, reflecting higher WESM costs and the Green Energy Auction Allowance, partially offset by lower feed-in tariffs. In contrast, Nordeco’s rate climbed to ₱14.81 per kWh, the highest in the Davao Region.

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Power for a Growing Economic Hub

As one of the fastest‑growing economies in the Philippines, Davao City has solidified its role as a major economic engine, with its gross domestic product expanding by nearly 7.9 % in 2024 and reaching around ₱574.7 billion. Reliable and affordable electricity is central to sustaining this growth, supporting industries, tourism, and households, and helping reinforce investor confidence and everyday quality of life as Davao’s economy continues to expand.

At the heart of the dispute between Davao Light and NORDECO are these essential concerns: affordability, reliability, and consumer choice. Consumers in other areas like Iloilo have faced similar debates over EC exclusivity versus competition, leading the Supreme Court to affirm that “a franchise, as a privilege granted by the state, is not the exclusive private property of the franchisee” and “must yield to serve the common good, as determined by Congress.”

In Davao, many residents and business stakeholders see the expansion of Davao Light’s franchise as a necessary shift toward dependable power service, even as legal challenges move through the Supreme Court. Consumers have the right to demand better, and ensuring that electricity services keep pace with economic and social needs remains a shared priority for the region’s future.

Sources:

https://aboitizpower.com/about-us/our-businesses/power-distribution/davao-light

https://en.wikipedia.org/wiki/Northern_Davao_Electric_Cooperative

https://www.sunstar.com.ph/davao/nordeco-appeals-to-pbbm-prevent-passage-of-bill

https://www.sunstar.com.ph/davao/cong-alvarez-says-nordeco-must-discontinue-its-unreliable-service

https://www.sunstar.com.ph/davao/recurring-power-woes-igacos-businesses-fear-long-lasting-effects-of-outages

https://opinion.inquirer.net/181574/a-power-sector-alphabet-soup

https://www.sunstar.com.ph/davao/nordeco-appeals-to-pbbm-prevent-passage-of-bill

https://lawphil.net/statutes/repacts/ra2025/ra_12144_2025.html

https://www.sunstar.com.ph/davao/nordeco-challenges-davao-light-franchise-expansion-at-supreme-court

https://www.sunstar.com.ph/davao/nordeco-vows-to-stay-operational

https://edgedavao.net/latest-news/2025/05/majority-of-power-consumers-in-davnor-ddo-support-davao-light-takeover-dcm-survey