| By Jess Diaz (The Philippine Star) Updated February 21, 2011 12:00 AM |
MANILA, Philippines - Energy officials intend to seek an increase in the cost of electricity of up to 15 centavos per kilowatt-hour (kwh) before the middle of next month.
Emmanuel Ledesma Jr., president of the Power Sector Assets and Liabilities Management Corp. (PSALM), has told the House energy committee that they would ask the Energy Regulatory Commission (ERC) to approve an adjustment of 12 to 15 centavos before March 15.
The increase would enable PSALM to pay part of its mounting debt incurred in paying the obligations of the National Power Corp. (Napocor), he said.
Under the Electric Power Industry Reform Act (Epira) of 2001, Congress created PSALM to manage the assets and liabilities of Napocor, which was supposed to be dismantled and its assets were to be sold to private investors.
Lawmakers envisioned that if there would be real competition among private power producers, the cost of electricity would go down. However, rates have gone up significantly since 2001.
Last year, the ERC returned to PSALM four petitions for rate adjustments the latter filed to pay for part of its loans. The petitions sought increases totaling more than P1 per kwh over a 16-year period.
The ERC returned the petitions because the filer refused to disclose information about the debts it has accumulated.
Ledesma did not say if his agency would file three more petitions after next month’s plea for an adjustment.
The House committee on energy has discovered that the corporation Congress had created to bail out Napocor is itself now mired in debt.
Ledesma told the committee that as of the end of 2010, the state firm he runs has accumulated a total of $15.82 billion (P696.08 billion at P44 to the dollar) in loans.
He said PSALM has already sold 91.8 percent of Napocor’s assets for $10.6 billion, including 25 generating plants for $3.39 billion and the National Transmission Corp. (Transco) concession for $3.95 billion.
He said in 2001, when Congress enacted Epira, total Napocor obligations amounted to $16.3 billion.
Transco was also created by Epira. It inherited Napocor’s transmission facilities. The private consortium that has been given the privilege to run it for 25 years has turned around and sold the concession for a huge profit.
Eastern Samar Rep. Ben Evardone, whose Resolution 106 has prompted the inquiry into PSALM’s and Napocor’s finances, said he could not understand why PSALM still had $15.82 billion in obligations, including those it inherited from Napocor.
“They are saying that total debt in 2001 stood at $16.3 billion, while privatization proceeds have amounted to $10.6 billion. If they have applied all the privatization proceeds to their total debt, they would have a balance of less than $6 billion,” he said.
He said he and his colleagues were shocked to learn that as of last Dec. 31, PSALM’s and Napocor’s debt still remained at close to $16 billion, almost the same level as 10 years ago despite more than $10 billion in earnings from the sale of Napocor’s assets.
Evardone pointed out that since PSALM claims that it has sold 92 percent of Napocor’s plants and facilities and has no more valuable assets to sell, it would have to make the public absorb its huge indebtedness.
“We the consumers will be the ones who will shoulder all these debts, which are still increasing. It appears that there will be no end in sight for power rate adjustments,” he stressed.
He urged PSALM officials to explain to the people why their agency is now deep in debt and why it would have to make them pay for it.
Emmanuel Ledesma Jr., president of the Power Sector Assets and Liabilities Management Corp. (PSALM), has told the House energy committee that they would ask the Energy Regulatory Commission (ERC) to approve an adjustment of 12 to 15 centavos before March 15.
The increase would enable PSALM to pay part of its mounting debt incurred in paying the obligations of the National Power Corp. (Napocor), he said.
Under the Electric Power Industry Reform Act (Epira) of 2001, Congress created PSALM to manage the assets and liabilities of Napocor, which was supposed to be dismantled and its assets were to be sold to private investors.
Lawmakers envisioned that if there would be real competition among private power producers, the cost of electricity would go down. However, rates have gone up significantly since 2001.
Last year, the ERC returned to PSALM four petitions for rate adjustments the latter filed to pay for part of its loans. The petitions sought increases totaling more than P1 per kwh over a 16-year period.
The ERC returned the petitions because the filer refused to disclose information about the debts it has accumulated.
Ledesma did not say if his agency would file three more petitions after next month’s plea for an adjustment.
The House committee on energy has discovered that the corporation Congress had created to bail out Napocor is itself now mired in debt.
Ledesma told the committee that as of the end of 2010, the state firm he runs has accumulated a total of $15.82 billion (P696.08 billion at P44 to the dollar) in loans.
He said PSALM has already sold 91.8 percent of Napocor’s assets for $10.6 billion, including 25 generating plants for $3.39 billion and the National Transmission Corp. (Transco) concession for $3.95 billion.
He said in 2001, when Congress enacted Epira, total Napocor obligations amounted to $16.3 billion.
Transco was also created by Epira. It inherited Napocor’s transmission facilities. The private consortium that has been given the privilege to run it for 25 years has turned around and sold the concession for a huge profit.
Eastern Samar Rep. Ben Evardone, whose Resolution 106 has prompted the inquiry into PSALM’s and Napocor’s finances, said he could not understand why PSALM still had $15.82 billion in obligations, including those it inherited from Napocor.
“They are saying that total debt in 2001 stood at $16.3 billion, while privatization proceeds have amounted to $10.6 billion. If they have applied all the privatization proceeds to their total debt, they would have a balance of less than $6 billion,” he said.
He said he and his colleagues were shocked to learn that as of last Dec. 31, PSALM’s and Napocor’s debt still remained at close to $16 billion, almost the same level as 10 years ago despite more than $10 billion in earnings from the sale of Napocor’s assets.
Evardone pointed out that since PSALM claims that it has sold 92 percent of Napocor’s plants and facilities and has no more valuable assets to sell, it would have to make the public absorb its huge indebtedness.
“We the consumers will be the ones who will shoulder all these debts, which are still increasing. It appears that there will be no end in sight for power rate adjustments,” he stressed.
He urged PSALM officials to explain to the people why their agency is now deep in debt and why it would have to make them pay for it.
No comments:
Post a Comment