Wednesday, May 8, 2019

CoA rules in favor of SMPC on dispute with PSALM



SEMIRARA Mining and Power Corp. (SMPC) expects to sit down with the Power Sector Assets and Liabilities Management Corp. (PSALM) to settle its money claim against the agency, after the Commission on Audit (CoA) ruled in favor of the Consunji-led company, company officials said.
Matagal ng ’yung Supreme Court ruling kaya lang hindi ma-enforce dahil walang CoA ruling. So nakuha ’yung CoA ruling lately (The Supreme Court ruling is old but it could not be enforced because it lacks CoA ruling. So the CoA ruling was received lately),” SMPC Chairman and Chief Executive Isidro A. Consunji said in a press briefing after the company’s annual stockholders’ meeting at the Manila Polo Club in Makati City on Monday.
SCPC is claiming the amount of P476,703,077.96 plus interest at 6% per annum computed from extrajudicial demand until actual payment in the case decided by the Energy Regulatory Commission in 2011 that went all the way to the Supreme Court.
The company told the stock exchange that the CoA decision is dated April 22, 2019 but was furnished to the company only on Monday.
The case stems from a petition filed by SMPC subsidiary Sem-Calaca Power Corp. (SCPC) against National Power Corp. (Napocor) and PSALM to declare as invalid Napocor’s nomination for the supply of electricity to Manila Electric Co. (Meralco) beyond 169,000 kilowatts (kW).
SCPC also sought to recover the amount charged and withheld by PSALM for spot market purchases to cover the deficiency in connection with Napocor’s over nominations for Meralco for January to June 25, 2010.
The ERC ruled that SCPC’s obligation under its contract is to deliver 10.841% of Meralco’s energy requirements but not to exceed 169,000 kW capacity allocation, at any given hour.
The obligation to deliver started from Dec. 2, 2009 when the physical possession, occupation and operation of the Calaca, Batangas power plant was formally turned over to SCPC.
The ERC said Napocor and PSALM have no basis, in fact and in law, to charge against SCPC the nominations beyond the 169,000 kW capacity that Napocor allegedly bought for Meralco from the wholesale electricity spot market.
It said there being no basis to charge SCPC, PSALM must return all the payments of Meralco, which were withheld by the government agency. This includes the amount representing the cost of electricity nominated and purchased by Napocor beyond the 169,000 kW from the spot market from January 2010 to June 2010.
“I think they (PSALM) will negotiate on the interest,” said Junalina S. Tabor, SMPC vice-president and chief finance officer, adding the interest payment is subject to CoA computation.
John R. Sadullo, SMPC vice-president for legal, said on the court procedure there was an opportunity for PSALM to appeal, although the move may just be moot and academic.
“There’s already a decision. As a government agency I think they should also abide by the decision. Anyway, it took a very long time for this decision to come out,” he said.
“Before the CoA decided on this as a money claim, we already went up to the Supreme Court. Actually, the CoA is implementing the decision of a final and executory judgement of the Supreme Court. So for us, it’s going to be moot and academic even if they try to do some procedural delay,” said Mr. Sadullo, who is SMPC corporate secretary and counsel.
On Monday, shares in SMPC slipped 1.46% to close at P23.65 each. — Victor V. Saulon

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