Arroyo bats for longer corporate life of PSALM
District Rep. Juan Miguel ‘Mikey’ Macapagal-Arroyo is pushing for the extension of the corporate life of Power Sector Assets and Liabilities Management Corp. to avoid “serious fiscal consequences” for the government.
Arroyo said his House Bill 10006 seeks to extend PSALM’s corporate life for 50 more years beyond June 26, 2026, its original expiration date.
He warned that if PSALM’s life would not be renewed, the government would be forced to shoulder P198 billion in debt from PSALM’s liabilities until 2026.
Arroyo, the committee on energy chairperson, said the government should not wait until the next administration to extend PSALM’s corporate life.
PSALM was established through Republic Act 9137 or the Electric Power Industry Reform Act in 2001 and was given a 25-year corporate life.
It then assumed the assets and liabilities of debt-ridden National Power Corp. toward the privatization of Napocor’s various properties.
It sold the 650-megawatt Malaya Thermal Power Plant in Pililla, Rizal and Isla de Provisor, the site of the old Manila Thermal Power Plant in Paco, Manila.
The remaining five years of PSALM’s corporate life may not be enough to complete the framework for the NG’s plans for its assets, according to Arroyo.
Arroyo said there are still remaining power assets and real properties that should be privatized by PSALM, and the extension of its corporate life would allow more time to complete the privatization of the remaining power plants and independent power producer contracts.
PSALM has yet to dispose of 33 percent corresponding to 809 lots equivalent to 9.8 million square meters.
Arroyo said there are also financial obligations from Napocor beyond June 2026 that PSALM should liquidate.
Moreover, the P208-billion Murang Kuryente Act fund allocation may not be given to PSALM in the next three years because of limitations in fiscal space, and that there are pending cases involving IPPAS that remain in courts.
The Pampanga lawmaker said the COVID-19 pandemic delayed the privatization efforts of PSALM.