STATE-RUN Power Sector Assets and Liabilities Management Corp. (PSALM) said it is optimistic about bringing down its outstanding obligations to nearly zero before the end of its extended corporate life.
“I am optimistic that we will be able to reduce the obligations in PSALM to close to zero at the end of the 10-year life,” PSALM President and Chief Executive Officer Dennis Edward A. Dela Serna told reporters last week.
Created under Republic Act No. 9136, or the Electric Power Industry Reform Act of 2001, PSALM was mandated to privatize government-owned power assets and manage the proceeds to settle the financial obligations of the National Power Corp. (Napocor).
The agency’s corporate term, initially set to expire in June 2026, has been extended by 10 years after a measure granting the extension lapsed into law in April.
Data from PSALM showed that it had reduced Napocor’s financial obligations to P262 billion as of June, down from a peak of P1.2 trillion in 2003.
Mr. Dela Serna said PSALM’s 10-year plan aims to liquidate remaining liabilities through several measures, including allocations under the Murang Kuryente Act, the privatization of the Caliraya-Botocan-Kalayaan (CBK) hydroelectric power plants, and a proposed concession agreement for the Agus-Pulangi hydropower complex.
The Murang Kuryente Act (Republic Act No. 11371) directs the use of the government’s share from the Malampaya natural gas project to pay PSALM’s stranded debts and contract costs, thereby lowering electricity rates for consumers.
PSALM expects to generate about P36.23 billion from the sale of the CBK hydroelectric power plants, which will be turned over to the Thunder Consortium, composed of Aboitiz Renewables, Inc., Sumitomo Corp., and Electric Power Development Co.
“That’s about P36 billion so there’s a remaining P64 billion. From there, we hope that with the successful concession of Agus-Pulangi, it should be more than enough to pay off all of these obligations once they mature,” Mr. Dela Serna said.
He said the agency is considering a concession model for the rehabilitation of the Agus-Pulangi hydropower complex, which is projected to generate P40 billion to P90 billion in revenues.
The complex, located in southern and central Mindanao, consists of seven run-of-river hydroelectric power plants with a combined capacity of around 1,000 megawatts (MW), though only 600 to 700 MW are currently operational due to aging facilities, based on a 2024 World Bank report.
While PSALM plans to conduct a bidding process for the concession, Mr. Dela Serna said the agency is also evaluating unsolicited proposals for the project.
“We received a number of unsolicited proposals and we are now in the process of evaluating these unsolicited proposals,” he said.
PSALM is targeting to finalize the Agus-Pulangi concession deal within the term of President Ferdinand R. Marcos, Jr. — Sheldeen Joy Talavera