Friday, February 14, 2020

PSALM asset privatization proceeds soar to P71.97 billion in 2019 from P33.34 billion


By Lenie Lectura - February 14, 2020

PROCEEDS from last year’s privatization programs of the Power Sector Assets and Liabilities Management Corp. (PSALM) ballooned to P71.97 billion from P33.34 billion in 2018.
“PSALM’s total privatization proceeds in 2019 [are] way higher than the actual privatization proceeds in 2018 which was at P33.34 billion,” said PSALM President Irene Joy Garcia.
The 115-percent increase was attributed to the sale of real property assets, efficient collection of IPPA (Independent Power Producer Agreement) lease payments and aggressive collection of past delinquent power accounts, added the PSALM chief.
“We met all the targets of PSALM for 2019 except for the privatization of the Malaya Power Plant,” she added.
PSALM has started soliciting bid invites for the privatization of the 650-megawatt (MW) Malaya Thermal Power Plant and its underlying land located at Brgy. Malaya, Pililla, Rizal.
The bid opening is set on April 15, 2020.
PSALM is determined to privatize the asset, which is sold on an ‘as-is-where-is’ basis, by taking the necessary steps to adjust the minimum bid price. It has also conducted valuation studies on MTPP and its underlying land in determining the reserve bid price.
“For 2020, we will continue this momentum and aggressively work on privatizing the remaining NPC assets,” added Garcia.
Among the power assets up for sale are the Caliraya-Botocan-Kalayaan Hydroelectric Power Plant (CBKHPP) and Casecnan multipurpose hydropower plant.
Garcia said the state firm is currently conducting a study on options for the sale of the 728-megawatt CBKHPP in Laguna and the 140-MW Casecnan multipurpose hydropower plant in Nueva Ecija.
“We are hoping we can get help from ADB [Asian Development Bank], which was the direction set by the DOF [Department of Finance]. We’ve already started working with DOF for us to be able to get assistance from ADB for the studies for the feasibility also for determining the structure that will be best suitable on how we can privatize it,” said Garcia.
The CBK hydro facility consists of the 22.6-MW Caliraya in Lumban, 20.8-MW Botocan in Majayjay and the 684.6-MW Kalayaan I and II in Kalayaan, Laguna.
J-Power and Sumitomo Corp. of Japan operate the CBK power plants.
The 140-MW Casecnan project, meanwhile, was built following the signing of a build-operate-transfer contract between the National Irrigation Administration (NIA) and California Energy Casecnan Water and Energy Company Inc. in 1994.
CE Casecnan’s contract with the government will lapse on April 5, 2022 while that of J-POWER will end on February 7, 2026.
PSALM, she added, will also pursue the auction for the contracted capacity of the 210MW Mindanao coal plant in Villanueva, Misamis Oriental.
Located in Misamis Oriental, the Mindanao coal plant was constructed in 2006 for a 25-year Power Purchase Agreement under a build-operate-transfer scheme that ends in 2031 with Steag State Power Inc. of Germany.
The power plant is 51-percent owned by Steag; 34 percent, Aboitiz Power; and 15 percent, La Filipina.
So far, PSALM has privatized 31generation assets including the Magat HPP,Tiwi-Makban geothermal power plants, Pantabangan-Masiway HPPs, Masinloc coal-fired thermal power plant and Batangas (Calaca) coal-fired thermal.
PSALM is the entity created by the Electric Power Industry Reform Act, the law that restructured the power industry by privatizing the assets of National Power Corp.

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