The House energy committee on Wednesday approved a substitute bill extending the corporate life of the Power Sector Assets and Liabilities Management Corp. (PSALM).
During the panel meeting, PHILRECA party-list Representative Presley De Jesus moved to approve the substitute bill for House Bill 10006, which aims to extend the corporate life of PSALM for another 30 years.
The motion was duly seconded by AKO PADAYON PILIPINO party-list Representative Adriano Ebcas.
PSALM began operations in July 2001 with the following functions:
* Structure the sale, privatization or disposition of the National Power Corporation (NPC) assets and independent power producer (IPP) contracts and/or their energy output based on such terms and conditions that will optimize the value and sale prices of these assets;
* Liquidate NPC’s stranded contract costs using proceeds from sales and other properties, including proceeds from the universal charge;
* Restructure existing loans of NPC; and
* Collect, administer and apply the NPC portion of the universal charge.
Moreover, PSALM also assumed all their outstanding financial obligations to the National Electrification Administration and other government agencies to strengthen the financial viability of electric cooperatives.
If PSALM’s corporate life is extended, it will be able to manage its remaining contractual obligations, particularly those whose terms shall end beyond June 2026, the bill said.
“A longer corporate life will enable PSALM to secure better terms for its borrowings for the next several years. PSALM will have more flexibility negotiating for better and longer-term financing for better management of liquidity risks,” the bill stated.
House ways and means committee chairperson Joey Salceda said the privatization of certain assets was delayed due to the COVID-19 pandemic.
“One example is the proposed development of the National Power Corporation (NPC) property in Diliman, Quezon City, for example, into a mixed-use commercial complex. We won’t have it done by 2026, so that effort will warrant the corporate life extension of the state-run corporation,” he said.
“If we can run the place the way BCDA (Bases Conversion and Development Authority) succeeded with efforts like Clark and Fort Bonifacio, I think we will be able to retire all of PSALM’s debts and even start making money out of it by around mid-2030s.”
PSALM has 25 years under the Electric Power Industry Reform Act (EPIRA) to fulfill its mandates unless otherwise extended by law. — VBL, GMA News
House panel OKs 30-year extension to PSALM s corporate life
Source: News Panda Philippines
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