4 power firms to pay P23B debt to gov’t

February 27, 2020

FOUR power producers have committed to pay their financial obligations to the natio-nal government amounting to P23 billion.

This was announced by chairman of the House Committee on Public Accounts and Anakalusugan Rep. Mike Defensor after conducting a public hearing on the state of the  Power Sector Assets and Liabilities Management (PSALM) Corp.

During the hearing, among those who promised to settle their obligations very soon are Meralco, which owes PSALM P15 billion; Northern Renewables Generation Corp., which has P4.6 billion in outstanding debt to the state corporation; FDC (Filinvest Development Corp.) Misamis Power Corp., P2.6 billion; and FDC Utilities, Inc., P1.2 billion.

The committee on public accounts together with committee on good government and public accountability is hearing the P95.4 billion the state-owned PSALM has been trying to collect from electric cooperatives and companies for years.

According to PSALM, these companies have a combined accumulated debt amounting to P23.4 billion for electricity and power plants bought from the government, or for managing generation assets.

PSALM is the agency tasked by Congress under the Electric Power Industry Reform Act of 2001 to sell the assets of the defunct National Power Corp.

“We got responsible officials of the four corporations to promise to pay their debt, which they have acknowledged. We will hold them to their commitment,” Defensor said.

In the case of Meralco, Defensor said the two committees learned that the power distributor and PSALM had agreed years back on a P15-billion settlement, but that the Office of the Solicitor General (OSG) opposed the agreement because it was not involved in it as the lawyer of the government and its agencies.

Based on a PSALM report submitted to the two committees, South Premier Power Corp. (SPPC), a subsidiary of San Miguel Corp. (SMC), owes the government P23.9 billion.

The SMC affiliate is contesting the PSALM billing in a case filed with a Mandaluyong City regional trial court.