Power firm denies P14-B plunder charge

MANILA, Philippines - The power firm implicated in the P14-billion plunder charge against the head of the state-run Power Sector Assets and Liabilities Management Corp. (PSALM) has denied liability.

Team Energy said the allegations in the criminal complaint filed recently by San Miguel Energy Corp. (SMEC) before the Department of Justice against the heads of its firms Team Philippines Energy Corp. (TPEC) and Team Sual Corp. (TSC) were “baseless and without merit.”

The complainant alleged that the memorandum of agreement between PSALM, TPEC and TSC for the Sual Power Plant in Pangasinan has caused the government P14 billion in losses.

In a statement sent to The STAR, Team Energy officer-in-charge and chief finance officer Toshiro Kume said the memorandum of agreement they forged with PSALM president and chief executive officer Lourdes Alzona in June 2009 was “legal and aboveboard.”

“The memorandum of agreement being questioned by SMEC was entered into by Power Sector Assets and Liabilities Management Corp., TSC and TPEC on June 18, 2009 prior to the appointment of SMEC as IPPA (Independent Power Producer) of the 1,000 megawatt contracted capacity of National Power Corp. This went through the regular approval process of the respective boards of NPC and PSALM – composed of the secretaries of finance, energy, budget and management, trade and industry, NEDA, interior and local government, agriculture, environment and natural resources and justice,” Kume explained.

Kume also denied the claim of SMEC that TPEC has priority over the dispatch of the 200-megawatt excess capacity, saying dispatch of capacity is based on competitive bidding under the wholesale electricity spot market (WESM) rules.

“In fact, it is clear from the memorandum of agreement that the contracted capacity of 1,000 MW has priority over the excess capacity of 200 MW, when due to the fault of TSC, the Sual Plant is unable to make available its full net capacity of 1,200 MW,” he explained.

Even prior to the memorandum of agreement, TPEC has been trading its 200 MW excess capacity in the WESM through PSALM. Under the agreement, the excess capacity continues to be traded through PSALM or its appointed IPPA, the firm said.

“Since September 2009 the SMEC, being the appointed IPPA, has been trading and collecting the proceeds of the sale of our excess capacity to the WESM. In fact, since October 2013, SMEC has not been remitting to TPEC a substantial portion of the proceeds of its sale of the excess capacity to WESM without basis and to TPEC’s detriment,” Kume added.

Team Energy said it has invested substantial capital in the country to build power plants to address the country’s development needs. The firm also said its track record will show that it has abided by and respected all the country’s laws and regulations and has operated with utmost integrity in all business dealings and contracts.

“It is unfortunate that contracts validly entered into by our company are now being interfered with by third parties that are not privy to them based on uninformed and misguided appreciation of facts. This will only result in a chilling effect to the inflow of foreign capital needed to sustain the continued development of the country,” the firm warned.