THE DEPARTMENT of Energy (DoE) said the corporate life of Power Sector Assets and Liabilities Management Corp. (PSALM) should be extended to prevent the government from assuming P300 billion in liabilities.
Energy Secretary Raphael P.M. Lotilla said that the government initially expected it would take 25 years to complete the sale of assets and settle the debts of the National Power Corp. (Napocor).
“In order to prevent an increase in rates and in order to prevent government from having to absorb some P300 billion in 2026 when the life of PSALM ends, we will have to extend the corporate life of PSALM, and there has been an agreement in the Congress to go ahead with that,” Mr. Lotilla said in a post-State of the Nation Address discussion on Wednesday.
PSALM was established under Republic Act No. 9136, or the Electric Power Industry Reform Act (EPIRA) of 2001, to lead the privatization of generation and transmission assets of Napocor and National Transmission Corp.
Its corporate life was originally set to expire in June 2026, 25 years after EPIRA’s effectivity. If PSALM is dissolved, all its assets and liabilities would revert to the National Government.
Mr. Lotilla added that a counterparty is needed to rehabilitate the Agus-Pulangi hydropower plants in Mindanao and enhance their capacity.
“Currently, while the installed capacity of Agus is 1,000 megawatts, the dependable capacity is only 600 megawatts,” he said.
“There is potential to rehabilitate it back to 1,000 megawatts, which would produce an additional 400 megawatts for Mindanao and other parts of the country through the Mindanao-Visayas interconnection,” he added.
Finance Secretary Ralph G. Recto has also suggested extending PSALM’s corporate life by another 25 years, as it still has many assets to sell and financial obligations to address.
OUTAGESMeanwhile, Energy Regulatory Commission (ERC) Chairman and Chief Executive Officer Monalisa C. Dimalanta saw that show cause orders will be issued to 39 generation companies that have exceeded their allowable plant outages.
“Once the explanations are submitted to the commission and we have completed the evaluation of these explanations, we will impose penalties for those that are not justified,” she said.
The reliability index, implemented since 2020, allows the ERC to set maximum limits on planned and unplanned outages per year, varying by generating plant technology.
In 2023, the ERC imposed approximately P60 million in penalties on generation companies for exceeding their outage limits.
The Philippines’ main island grids were placed under red and yellow alerts between April and June due to forced outages or deration of several power plants amid El Niño and elevated temperatures. Just last week, yellow alerts were raised on the Luzon grid for two days. — Sheldeen Joy Talavera
