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MANILA, Philippines - The Power Sector Assets and Liabilities Management Corp. (PSALM) is finalizing the amount of the stranded debts (SD) and stranded contract costs (SCC) of the National Power Corp. (Napocor) to be recovered through the universal charge (UC).
PSALM president and chief executive officer Emmanuel R. Ledesma Jr. said this is in compliance with the deadline set by the Energy Regulatory Commission (ERC).
Ledesma said in filing the UC applications in time for the June 30, 2011 deadline, PSALM will follow the revised guidelines released by the ERC on March 7, 2011.
The initial filing was originally set on March 15, 2011, but since the amended guidelines were released only a week before the deadline, the ERC accordingly extended the deadline for filing upon PSALM’s request.
PSALM is mandated under Republic Act 9136, the Electric Power Industry Reform Act (EPIRA), to calculate the amount of the SD and SCC of Napocor.
After an extensive review of PSALM’s UC-SD and SCC applications, the ERC will determine, fix, and approve the UC to be collected from electricity consumers.
As part of determining the SD and SCC amounts, PSALM recently conducted a series of workshops aimed at educating stakeholders and partner agencies on the dynamics of the UC, and at soliciting ideas and opinions on interpreting the amended guidelines for the SD-SCC computation.
Sponsored by the Asian Development Bank (ADB), the workshops were attended by representatives from the Department of Finance, Napocor, the Department of Energy, the National Economic and Development Authority, the Bangko Sentral ng Pilipinas and the Department of Budget and Management.
The ADB said the collection of the UC, which is a viable way of settling the debts of Napocor, must be a concerted effort of all involved agencies to considerably ease the financial obligations of the Philippine government.
Ledesma said with the collection of the UC, coupled with the privatization of the remaining power assets, PSALM’s debt obligations may significantly be reduced from an estimated $3.78 billion by the end of its corporate life.
To soften the impact of the UC collection on electricity consumers, Ledesma stated that options, such as spreading out its implementation over a number of years, are also being explored.
The EPIRA defines stranded debts as any unpaid financial obligation of Napocor that has not been liquidated by the proceeds from the privatization of Napocor’s assets.
Stranded contract costs, on the other hand, are defined as the excess of the contracted cost of electricity under eligible contracts over the actual selling price of the contracted energy output of these contracts in the market.
PSALM president and chief executive officer Emmanuel R. Ledesma Jr. said this is in compliance with the deadline set by the Energy Regulatory Commission (ERC).
Ledesma said in filing the UC applications in time for the June 30, 2011 deadline, PSALM will follow the revised guidelines released by the ERC on March 7, 2011.
The initial filing was originally set on March 15, 2011, but since the amended guidelines were released only a week before the deadline, the ERC accordingly extended the deadline for filing upon PSALM’s request.
PSALM is mandated under Republic Act 9136, the Electric Power Industry Reform Act (EPIRA), to calculate the amount of the SD and SCC of Napocor.
After an extensive review of PSALM’s UC-SD and SCC applications, the ERC will determine, fix, and approve the UC to be collected from electricity consumers.
As part of determining the SD and SCC amounts, PSALM recently conducted a series of workshops aimed at educating stakeholders and partner agencies on the dynamics of the UC, and at soliciting ideas and opinions on interpreting the amended guidelines for the SD-SCC computation.
Sponsored by the Asian Development Bank (ADB), the workshops were attended by representatives from the Department of Finance, Napocor, the Department of Energy, the National Economic and Development Authority, the Bangko Sentral ng Pilipinas and the Department of Budget and Management.
The ADB said the collection of the UC, which is a viable way of settling the debts of Napocor, must be a concerted effort of all involved agencies to considerably ease the financial obligations of the Philippine government.
Ledesma said with the collection of the UC, coupled with the privatization of the remaining power assets, PSALM’s debt obligations may significantly be reduced from an estimated $3.78 billion by the end of its corporate life.
To soften the impact of the UC collection on electricity consumers, Ledesma stated that options, such as spreading out its implementation over a number of years, are also being explored.
The EPIRA defines stranded debts as any unpaid financial obligation of Napocor that has not been liquidated by the proceeds from the privatization of Napocor’s assets.
Stranded contract costs, on the other hand, are defined as the excess of the contracted cost of electricity under eligible contracts over the actual selling price of the contracted energy output of these contracts in the market.
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