PSALM readies sale of big hydro power plants

The Power Sector Assets and Liabilities Management Corp. (PSALM) is readying the sale of the first batch of big hydroelectric power generating facilities of the National Power Corp. (Napocor), a PSALM official said.

PSALM vice president for asset management and disposal Froilan Tampinco said they expect the sale of Pantabangan and Masiway hydropower plants by end of next month or early June.

"We are in the process of threshing out some remaining issues and finalizing the privatization package for these two power plants," Tampinco said.

The 100-megawatt (MW) Pantabangan will be auctioned off separately from the 12-MW Masiway power plant. "They will be privatized one day apart," he said.

He said PSALM will issue the public notices for the sale of the two power plants as soon as the issues are resolved with the National Irrigation Authority and National Water Regulatory Board.

"These two power plants are not only used for power generation but also for water irrigation purposes," Tampinco said.

The PSALM official said at least two foreign and two local firms have expressed interest in bidding for Pantabangan while six local groups may bid for Masiway.

Tampinco said PSALM has been receiving favorable responses from investors for the hydropower facilities because these are normally considered as viable peaking plant.

"Feedbacks from our latest investors’ forum indicated that potential bidders prefer hydropower facilities," he said.

He added hydropower plants are also expected to benefit from the time-of-use (TOU) tariff now pending with the Energy Regulatory Commission (ERC).

TOU will allow power generating firms to charge generation fee based on the time electricity is used.

"Hydropower facilities have a built-in advantage because they do not have water source problems. Pantabangan and Masiway basically serve as catch basins for the Pantabangan River. Thus, these plants’ reliability levels are high," he said.