PSALM collects P672-B from NPC sale

By Myrna M. Velasco – January 9, 2022, 10:10 PM
from Manila Bulletin

State-run Power Sector Assets and Liabilities Management Corporation (PSALM) reported that the magnitude of privatization proceeds it collected from the divestment of National Power Corporation (NPC) assets already topped P672.57 billion as of the end of the third quarter 2021.

Power Sector Assets and Liabilities Management Corp

Based on NPC data, the remaining proceeds it has yet to fetch would be P239.44 billion, out of the P912.01 billion revenues yielded by the privatization of the country’s power assets.

“Total collection of P672.572 billion as of September 2021, has been augmented by interest income on placements and funds from power receivables,” the state-owned firm noted, adding that the collected proceeds were utilized mainly in settling outstanding financial obligations.

At its privatization phase, the assets as well as the financial liabilities of NPC had been transferred to PSALM and it was a primary mandate of the Electric Power Industry Reform Act (EPIRA) that the successor-firm will be in charge of retiring all of the passed-on debts and lease obligations of NPC.

PSALM figures showed that proceeds from the sale of generating assets at P165.09 billion had been fully collected. For the privatization of the independent power producer (IPP) contracts, revenues already hovered at P313.07 billion vis-à-vis total proceeds of P482.50 billion.

For the fees on the 25-year concession deal for the transmission assets of the National Transmission Corporation, collections had been at P190.53 billion, and the remaining balance stands at P70 billion.

The divestment of the decommissioned plants also raked in proceeds of P524 million and that is also fully collected, according to PSALM, along with the P3.36 billion worth of earnings from the sale of other assets.

PSALM emphasized that “for the generating assets, the amount generated consists of financial bids (based on the asset purchase agreements) and interest earned from deferred payments while for IPPA appointments, the amount generated consists of monthly payments and generation fees under the IPP administration agreements.”

For the concession fees of the transmission assets, it was pointed out that the collections had been “net of the final adjustment to project under construction (PUC) and initial working capital (IWC).”

PSALM’s corporate life is until 2026, but a legislative proposal was lodged in Congress so its longevity could be extended for another 25 years. The justification for that is the scale of NPC liabilities it has yet to retire at P367.20 billion as of end-September last year and the remaining assets still due for divestments.