Psalm to prepay P19-billion obligation with BTr

By Bernadette D. Nicolas – February 24, 2021
from Business Mirror

THE Power Sector Assets and Liabilities Management Corp. (PSALM) is targeting to reduce its maturing obligations by P24.63 billion and prepay its obligations of P19 billion with the Bureau of the Treasury (BTr) this year.

PSALM President and CEO Irene Joy Besido-Garcia said in a report they are also aiming to collect P10.33 billion in power sales and P359 million in overdue or delinquent accounts.

It will also strive to maintain its 98-percent collection goal for the Universal Charge (UC) as well as the 100-percent disbursement rate for the UC for missionary electrification and renewable energy, according to Besido-Garcia.

Apart from these, she added PSALM will also be unloading real estate assets worth P948.93 million combined and privatize power assets, including the Malaya Thermal Power Plant (MTTP) in Pililla, Rizal.

Last year, PSALM brought down its financial dues by P40.3 billion by the end of 2020, which is four times over its P10.184-billion target.

PSALM earlier reported that its financial obligations were reduced to P381.72 billion as of end-December last year from P422.01 billion at the start of the year.

Moreover, the state-run firm also collected P12.89 billion from power sales last year, representing a 93.9-percent collection
efficiency.

On top of this, Psalm collected P2.61 billion from overdue or delinquent accounts, which was P1.66 billion or 175 percent more than its 2020 goal of P945 million, which Besido-Garcia said was done by allowing flexible payment options that encouraged power customers to settle their past arrears.

Psalm also got P16.69 billion from the UC due from power distribution utilities and other electricity suppliers, achieving its 98-percent collection goal.

All these collections were utilized by PSALM to pay not just its financial obligations, but also all the interest and borrowing costs that matured in 2020 amounting to P12.83 billion.

A total of P11.99 billion in UC for missionary electrification was also fully disbursed by the firm to the National Power Corp. and another P6.2 million was released to renewable energy developers, Besido-Garcia said.

Deferred privatization proceeds collected by the firm also stood at P38.66 billion last year while disposal of real property assets yielded PSALM with P51.65 million even amid the Covid-19 pandemic. This was done by adjusting some of its bidding procedures to allow online participation of bidders, remittance by bank transfers and no-contact transactions.

To raise funds from real estate assets not yet scheduled for privatization, Besido-Garcia aid Psalm entered into short-term lease agreements involving these properties, which generated P29.5 million in additional revenues in 2020.

Psalm also saved P15.01 million due to the early payment of real property taxes while the package sale of unserviceable assets in various locations raised P26.45 million more in additional revenues

With the signing of Executive Order 117, Psalm also reduced its real property tax liability to P199 million from P1.06 billion, which led to savings of P861 million for the wholly-owned and controlled government entity.

The firm also successfully lowered the average interest rate on its borrowings to 4.17 percent by end-2020, from an average of 5.07 percent in end-2019, and with PSALM increasing the share of its loans sourced from the domestic market to 33.55 percent to mitigate its foreign exchange risks.

PSALM saved P212.85 million in 2020 from competitive bidding exercises for the purchase of its foreign exchange requirements to service maturing debts. PSALM also effectively defended its legal position in several legal cases to either save or raise funds amounting to over P1 billion.

To support the government’s COVID-19 response programs, PSALM also extended the due dates of power billings, UC remittances and submission of UC reports to PSALM. It also facilitated the early release of P183.21 million to 113 local government units (LGUs) as their share in national wealth and another P505.6 million in Energy Regulations 1-94 Funds to 16 LGU beneficiaries. Likewise, PSALM remitted P92.24 million in dividend payments to BTr in 2020 to support the government’s pandemic response.

According to Besido-Garcia, PSALM also maintained its ISO 9001:2015, indicating its firm commitment to ensure that its business processes and systems meet international quality standards.