A combination of asset sale proceeds and advanced payment by a debtor has allowed the Power Sector Assets and Liabilities Management (PSALM) Corp. to cut its financial obligations to P283.65 billion as at end-March this year, from its peak of P1.24 trillion in 2003.
The PSALM said advanced payment by Therma Luzon Inc. of its monthly obligations relative to the Pagbilao independent power producer (IPP) administration contract in November 2023, the sale and turnover of the Casecnan hydroelectric power plant to Fresh River Lakes Corp. in February 2024, and the successful privatization of selected real estate assets that generated P31.77 billion.
“We are extremely pleased with the progress made in reducing our financial obligations. The reduction in our financial obligations brings us closer to fulfilling PSALM’s mandate and ensuring a sustainable power sector in the Philippines,” said Dennis Edward Dela Serna, PSALM president and chief executive officer, in a statement.
As of end-March this year, the PSALM generated proceeds from the sale of generation assets, appointment of IPP administrators, and privatization by way of concession of the government transmission business amounting to P903.412 billion, with actual collection of P769.602 billion.
The PSALM implemented a multi-pronged strategy for lowering its obligations, including the optimization of the operations of its remaining power assets and maximizing revenue streams aside from entering into short-term lease agreements over assets not yet scheduled for privatization, raising additional revenue of P12.06 million.
In terms of power sales, the PSALM achieved a collection efficiency rate of 93.35 percent equivalent to P14.91 billion in sales from its remaining power plants.
The PSALM is mandated to dispose of power-related government assets to pay for outstanding financial obligations inherited from the National Power Corp.
