Business Mirror
MONDAY, 26 SEPTEMBER 2011 20:29 PAUL ANTHONY A. ISLA / REPORTER
THE Power Sector Assets and Liabilities Management Corp. (PSALM) said on Monday that privatization has been ongoing for 10 years since the enactment of the Electric Power Industry Reform Act (Epira) in 2001 and has successfully diversified the ownership of National Power Corp. (Napocor) power plants.
Emmanuel Ledesma, PSALM president, said in a statement that the privatization of government assets is only part of the reform framework provided under the law, which seeks to achieve reasonable power rates in the country.
Ledesma made the statement in light of Rep. Lorenzo Tañada III’s warning of more escalations in the cost of electricity as certain players in the power sector have allegedly been engaging in questionable sales and bidding of power plants with PSALM.
Ledesma said specific measures to reduce electricity rates are also provided in the law, such as zero-rating of value-added tax, use of excess universal charges collected, reduction of rates of power from indigenous sources, removal of inter-grid and intra-grid cross subsidies, and other similar measures.
He added that the condonation of loans of electric cooperatives, which was already undertaken by PSALM, should have also resulted in lower rates charged by the electric cooperatives concerned.
Ledesma said it does not appear in the Epira that privatization by itself was intended to result in reduced power rates, and that the other reforms must also be undertaken by Congress and other government agencies.
With respect to the observation that only a few play a major role in power generation, Ledesma noted that only Napocor owns these plants.
“After privatization, we now have at least 10 successor-generator companies, which we think is hardly few. In any case, with the nationwide generation ownership cap of 25 percent, it may be assumed that the Epira only envisioned a minimum of four owners of all generating capacity nationwide. Privatization has resulted in a much more diverse ownership base than the minimum set by the Epira,” he said.
Ledesma added that they understand Tañada’s concerns on privatization arose from reports that his office received.
He said PSALM has no knowledge of those reports, and cannot verify them. PSALM, however, is willing to answer these reports in order to better enlighten the people of what really transpired since the Epira was enacted, at least on the privatization of Napocor power plants.
“We reiterate that the reform framework provided under the Epira is indeed complex, and privatization is just one component of that reform framework,” he said.
On Naga privatization, Ledesma said SPC Power Corp.’s right to top has been disclosed to the bidders at the start of the bidding process, but their interests to bid are maintained based on the feedback we have gathered from most of them.
Our soonest privatization of the Naga Complex as an independent power producer administrator can help reduce PSALM’s financial obligations by getting the best possible value of the plant despite the existence of the right to top.
Tañada issued the warning after receiving reports on alleged anomalous selling and bidding of power plants that are being facilitated by PSALM, a government-owned company created under Epira that has been tasked to handle the privatization of government power plants.
“We want PSALM to hold in abeyance the Naga IPPA bidding until it has clarified issues regarding how the bidding rules have been designed,” Tañada said.
He added that the Philippines has the highest electricity rates in Asia at P8.14 per kilowatt-hour.
“This is a major reason our industries are hardly competitive. Epira failed to arrest the financial hemorrhage of the PSALM and Napocor,” Tañada said, adding that PSALM has only created more problems in the power industry.”
“PSALM’s debts and losses should be recognized as a key policy issue that cannot be left to its failing management,” Tañada said.
No comments:
Post a Comment