THE Power Sector Assets and Liabilities Management Corp. (PSALM) could raise as much as P100 billion from the privatization of the Caliraya-Botocan-Kalayaan (CBK) hydroelectric power plant complex, according to the chairman of the state firm.
“CBK is up for bidding. We could probably generate anywhere from P50 billion to P100 billion. That will help plug our deficit for next year,” said Finance Secretary Ralph Recto, who is also the chairman of the PSALM board.
Recto said the auction will commence in “the next few months” while the turnover of the asset to the winning bidder could happen next year.
The CBK hydro facility consists of the 22.6-megawatt (MW) Caliraya in Lumban, 20.8-MW Botocan in Majayjay and the 684.6-MW Kalayaan I and II in Kalayaan, Laguna. The plants are under an IPP (Independent Power Producer) administrator contract with CBK Power Co. Ltd. until February 7, 2026. The IPP administers the plant’s contracted capacity of 796.46 MW.
PSALM is the agency mandated by the Electric Power Industry Reform Act (Epira) to handle the financial obligations of the National Power Corp. (Napocor) through the privatization of government-owned assets, collection of the proceeds and its effective implementation of its liability management program.
Its corporate life will expire in June 2026. Recto said there is need to extend PSALM’s corporate life so it could continue with the sale of the remaining power assets and other properties, manage Napocor’s liabilities and collect all receivables. “I think it should be extended, possibly another 25 years. Marami pa ring debts ang PSALM, marami pang dapat ibentang assets [PSALM still has a lot of debt; there are still assets that need to be sold off],” said Recto.
PSALM’s financial obligations were reduced to P294.27 billion as of January 2024.
When PSALM was created, Napocor’s debts stood at P830.7 billion. This is composed of outstanding long-term debts and the BOT (build-operate-transfer) lease obligations. The outstanding long-ter.m debts represent the unpaid obligations of Napocor to various creditors, which amounted to P319.1 billion beginning in 2001. On the other hand, the BOT lease obligations represent the amount due from Napocor to IPPs for facilities built in the 1990s to ensure increased generator capacity and adequate supply of electricity for a wider set of end-users. In 2001, the beginning balance of BOT lease obligations amounted to P511.6 billion.
Aside from CBK, PSALM will also sell the 200MW Mindanao coal plant, Agus-Pulangi, land underlying IPP plants, and other real estate assets. “The priority is the privatization of CBK,” added Recto.
As of end-January this year, PSALM has successfully privatized and turned over to the winning bidders a combined capacity of 5,251.43 MW, consisting of 32 generating assets.
Last February 25, PSALM turned over the 165MW Casecnan hydroelectric power plant to the winning bidder.
