| By Donnabelle L. Gatdula (The Philippine Star) Updated December 16, 2010 12:00 AM |
MANILA, Philippines - The Energy Regulatory Commission (ERC) has given the Power Sector Assets and Liabilities Management Corp. (PSALM) until March 15, 2011 to submit a revised petition for universal charge (UC) to recover the National Power Corp.’s stranded costs and debts.
“They have to come up with their proposed amendments to their UC petition before March 15. Under the law, applicants are given every March 15 of every year to file its application for rate adjustments,” ERC executive director Francis Saturnino Juan said.
Juan said PSALM, in its previous filing, failed to substantiate its UC claims.
“If you are asking for a tariff, you have the responsibility to submit all pertinent documents to justify your application,” he said, pointing out that there are revenue components not declared by PSALM in its previous application.
Juan also noted out that there were differences in the computation of privatization proceeds from Napocor assets particularly those under the independent power producer administrators (IPPAs).
Some of the documents filed by PSALM, he said, are also outdated.
The ERC official, however, said he is uncertain if PSALM’s amended application would result to a higher or lower UC.
Energy Secretary Jose Rene Almendras, a vice chairman of PSALM, earlier said consumers are likely to pay lower UC as the agency vows to bring down Napocor’s borrowing costs.
“There are refinancing options that are being studied, and hopefully take it down and there are plans to take forward some of the cash flows which were being scheduled longer, we’re trying to take them forward so that you retire some of the debt earlier. Therefore your total cost of carrying it over the next 16 years goes down. In addition to the fact that there are opportunities to refinance at lower costs,” Almendras said.
It would be noted that PSALM’s earlier petition was junked by the regulators due to its failure to submit pertinent documents to support its rate hike application.
PSALM is the agency mandated by the Electric Power Industry Reform Act of 2001 to privatize Napocor’s assets and to use the proceeds from the privatization to pay off the latter’s debts.
Almendras said to be able to reduce the UC charges, PSALM would try to undertake refinancing schemes on Napocor’s existing debts to take advantage of low interest rates.
On June 30, 2009, PSALM petitioned the ERC for the recovery of Napocor’s stranded debts portion of the universal charge. Based on PSALM’s simulations, Napocor’s stranded debts was estimated at P470.87 billion by the end of 2005.
PSALM earlier proposed a levelized stranded debt charge of up to 31 centavos per kilowatt-hour to be imposed on all electricity consumers.
Last June 29, 2010, PSALM filed another stranded debt petition for 2010, which it simulated to reach P54.90 billion, at the rate of 87 centavos per kwh.
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