The local government of Quezon has threatened again to put the 700-megawatt Pagbilao coal power plant in the province in the auction block for non-payment of real property taxes.
Energy Secretary Jose Rene Almendras said talks to resolve the tax issue between the Executive Secretary Paquito Ochoa and Quezon Gov. David Suarez were still ongoing.
The local government earlier threatened to auction the plant by March 9 after postponing the bidding originally scheduled on Feb. 9.
“It was postponed because the national and local governments were resolving the issue but so far there’s no final agreement,” Aboitiz Power Corp. senior vice president Luis Miguel Aboitiz said.
Suarez agreed to stop the planned auction of the power plant last month in exchange for infrastructure projects for the province to be financed by the national government.
The plant supplies about 7 percent of the power demand in Luzon. The Quezon provincial government and the municipality of Pagbilao, however, had threatened to auction it off, claiming the operator owed them P6.1 billion in real property taxes.
National Power Corp. assumed the responsibility of paying all the taxes on the plant when it awarded the contract to operate to Team Energy Corp.
The Quezon provincial government claimed that TeaM Energy owed it P6.1 billion in real property taxes from 1997 to 2010. Napocor, meanwhile, said the Local Government Code exempted it from paying tax on the plant.
Aboitiz Power sells the electricity output of the plant under its independent power administrator contract with the government.
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