Japanese, European firms keen on Napocor’s generation assets

Some Japanese and European power companies have expressed interest in the generation assets of the National Power Corp. (Napocor) which are slated for sale within the year, Power Sector Assets and Liabilities Management Corp. (PSALM) president Edgardo del Fonso said.

"We are now preparing the information memorandum which will be out by middle of August. Many have expressed interest. These are big power firms from Japan and Europe," del Fonso said.

He said a timetable for the sale of the generation assets has been set. After the release of the info memo by middle of next month, PSALM expects the due diligence period to proceed by September.

Bidding, he said, is set within the year and some are slated for the first quarter of next year.

He said the Sucat and Limay power plants are among the first batch of generation assets lined up for sale in the next two months.

"Since these plants are to be converted into natural gas power facilities, it will not be that sensitive and will not be dependent on tariff issues unlike the coal and geothermal power plants," he said.

He admitted that they have a hard time selling tariff-sensitive power plants. "Investors will always be looking at the tariff that will be generated from these plants,"he said.

The Energy Regulatory Commission (ERC) has approved a much lower tariff compared to what the Napocor initially applied for.

The Napocor, however, has a pending motion for reconsideration with the ERC to increase the approved generation rate.

Aside from Sucat and Limay, the other power facilities to be auctioned off in the next two months are: Navotas, Pinamucan, two mini-hydro plants in Mindanao and 1 small diesel plant in Bohol.

Del Fonso said the other power plants are considered to be included in the first batch because these are already expired contracts such as the Pinamucan and Navotas.

The other small plants, he said, are currently not being used. "We might as well sell them since we are not using them," he said.