The payment came after an independent auditor, Meritec, based in New Zealand, reviewed and recommended that Napocor effect payment of the overdue invoices, which were apparently delayed for 90 days.
Based on Napocor data, it paid $4.57 million and P19 million for the months of March to May representing capital recovery fee (CRF).
The Department of Energy (DOE), on the other hand, said Meritec had already presented its evaluation on the completion of the Kalayaan I Unit I to Napocor.
Meritec was commissioned by the DOE to conduct a separate review following a report submitted by newly-designated presidential adviser for energy affairs Jesus N. Alcordo involving an unaccomplished task in the rehabilitation.
Alcordo, who is also Napocor president on-leave recommended to Energy Secretary Vincent S. Perez to suspend all rehabilitation payments after he found out that the National Transmission Corp. (Transco) released a certificate of completion when "some items in the scope of the rehab have not been accomplished yet."
In a phone interview, Transco president Asisclo T. Gonzaga, however, stressed that Meritec did not find anything wrong with the rehabilitation project. "The result only proves that all our actions have been above-board and that allegations of irregularity are all falsehoods," Gonzaga said. "We hope all these media attacks against our officials and our corporation will now cease."
Another Napocor source said, "just to set the record straight, everything was normal. The independent auditor highly recommended for the immediate payment so as not to incur official default. This wrong information was just made up by some detractors," he said.
The DOE, for its part, also said that the Meritec report considered that the acceptance and commissioning of Kalayaan I Unit 1 were met except that some range and load required under the Build-Rehabilitate-Operate-Transfer (BROT) Supplemental Agreement between Napocor and CBK Power.
The absence of the SFC, however, was deemed to have little effect on system operations. The majority of the conversion items for completion between Kalayaan Unit 1 and 2 were found by Meritec to have been completed.
The DOE said the main reasons for non-compliance of common items were that these can only be completed during station outage, which Napocor has not been able to provide for sufficient duration; and that a number of common items can only be completed in conjunction with the completion of Kalayaan II.
Meritec also recommended to Napocor administrative procedures for commissioning of subsequent units be reviewed. The issuance of a substantial completion certificate on completion of testing would seem more appropriate, as it could enumerate any outstanding minor items (not affecting the commercial operation of the unit) to be completed, and would trigger the CRF. The issue of such certificate of completion would only follow when all outstanding minor items have been completed.
The 1998, IMPSA was awarded a $450-million BROT project with Napocor. That was after five years after it applied for the project and actually started rehabilitation of Kalayaan I and II and the installation of Kalayaan III and IV.