GMA okays Transco privatization plan

President Arroyo approved yesterday the privatization plan of the transmission assets of the National Transmission Corp. (Transco).

Energy Secretary Vincent S. Perez, who is also the chairman of the privatization bidding and awards committee, said the President has given her go signal even as she expressed disappointment that the Senate has yet to act on the Transco franchise bill, which has been certified as an urgent economic measure.

"The President sees the importance and the urgency of the privatization of the Transco. She knows that something must be done to stop the continuous bleeding of the government resulting from the financial losses of the National Power corp. (Napocor)," he said.

This is the reason, Perez pointed out, why President Arroyo has reminded Congress on too many occasions on the need to immediately approve the Transco franchise bill. She knows fully well that the Transco franchise will help generate a higher level of investor interest and maximize proceeds for the government in privatizing the Transco, he added.

"Certain senators apparently have refused to heed her call. But even with the absence of a Transco franchise law, Transco privatization will commence as the President has instructed us. She also said that she is confident that the Transco privatization will gather investors’ interest worldwide and eventually result in the award of a concession by middle of the year," Perez said.

Formal notices of invitation were published yesterday in local and international newspapers, inviting expressions of interests from potential bidders as the Power Sector Assets and Liabilities Management Corp. (PSALM) launched the Transco privatization.

PSALM is the entity designated by Republic Act 9136, otherwise known as the Electric Power Industry Restructuring Act, to carry out the privatization of Transco.

Prospective bidders are requested to submit their expressions of interest to PSALM not later than Feb. 21.

Phase Two shall commence when Congress approves a franchise in favor of the Concessionaire. At that point, the Concessionaire shall take over as the grid operator and run the entire transmission system.

Secretary Perez earlier said this approach would enable the privatization of Transco even as Congress deliberates on a franchise bill.

PSALM president Edgardo M. del Fonso said the privatization of Transco will cover a period of about six months, including the time required for due diligence.

He estimated that by July 2003, PSALM can complete the process with the award of the concession to the winning bidder.