PSALM cuts debt to P344 billion in Q1

MANILA, Philippines — State-run Power Sector Assets and Liabilities Management Corp. (PSALM) trimmed its total debt by P11 billion in the first quarter.

The agency has reduced its financial obligations from P355.2 billion at the end of last year to P344.08 billion as of end-March.

The agency’s total outstanding debts amounted to P258.42 billion, while independent power producer (IPP) lease obligations were at P85.66 billion.

In terms of currency, more than half or 58 percent of PSALM’s debt is denominated in dollars, amounting to P200.07 billion.

Peso-denominated financial obligations account for 37 percent or P128.24 billion, while the remaining P15.77 billion, equivalent to five percent, is in Japanese yen.

From the 2003 level of P1.24 trillion debt, PSALM’s financial obligations have gone down by P896.52 billion.

PSALM reduces debts through the privatization of government-owned assets, collection of proceeds, and effective implementation of its liability management program.

For this year, PSALM is targeting to cut its debt by P20 billion to P335.89 billion by end-June.

To meet this target, the agency needs to trim off P9.08 billion in the second quarter.

In the updated Power Development Plan 2020-2040, the Department of Energy (DOE) said it steadfastly performs its supervisory and policy-making functions to ensure fulfillment and completion of the privatization of the remaining assets of the National Power Corp. (Napocor) and IPP contracts.

Earlier this month, PSALM turned over the 1,200-megawatt (MW) Ilijan Power Plant in Batangas to SMC Global Power Holdings Corp. through wholly owned subsidiary South Premiere Power Corp. (SPPC) after a deed of sale was executed last June 3.

SPPC was appointed the independent power producer (IPP) administrator for the Ilijan Power Plant under an administration agreement signed on June 26, 2010.

Earlier, PSALM president and CEO Irene Besido-Garcia said the Ilijan plant was turned over to SPPC on June 5 despite a case pending in the Regional Trial Court (RTC) of Mandaluyong City since 2015, which stemmed from differences in computing generation charges.

PSALM had calculated generation charges based on the wholesome electricity spot market (WESM) prices to maximize its earnings from the IPP Administrator (IPPA), while SPPC used a fixed rate approved by the Energy Regulatory Commission (ERC).

As of end-2020, PSALM claimed that SPPC still owed the government P23.07 billion in generation payments.