ERC assures TransCo bidders of stable regime

The Energy Regulatory Commission (ERC), the country’s power sector watchdog, assured yesterday the prospective bidders of National Transmission Corp. (TransCo) of a transparent and stable regulatory framework.

In a forum organized by the Power Sector Assets and Liabilities Management Corp. (PSALM), ERC commissioner Rauf A. Tan allayed concerns of regulatory risk in the privatization of TransCo.

PSALM is the government agency tasked to privatize TransCo.

"We have a transparent and stable regulatory regime, and there will be no arbitrary changes in the rules," Tan said.

The forum aimed to facilitate discussion and clarification of regulatory concerns. It was attended by representatives from the pre-qualified TransCo bidders that include the consortium of Triratna Holdings Corp., Tenaga Nasional Bhd. and Newbridge Asia; the consortium of Citadel Holdings Inc. and Terna SPA; and the consortium of Monte Oro Grid Resources Corp. and State Grid Corp. of China. Also present in the forum were PSALM president and CEO Nieves L. Osorio and TransCo president Arthur N. Aguilar.

Last week, Finance Secretary Gary B. Teves and Energy Secretary Raphael PM Lotilla, who sit in the PSALM board as chairman and vice chairman, respectively, announced the rescheduling of the TransCo auction to February.

This, they said, was "to give the PSALM management and prospective bidders additional time to thresh out some important legal and commercial issues to ensure a sustainable long-term concession contract which is fair to both the Philippine government and the bidders."

PSALM issued the final bid documents to the bidders on January 22 and the bidding proper, if not pushed back anew, will be held on Feb. 5.

"While it is our responsibility to privatize TransCo at the soonest, it should not prejudice the quality and integrity of the process. The bigger responsibility is to protect government interest and provide a fair return of investment to the prospective concessionaire," Osorio said.

As the operation of a transmission system is a public utility, the concessionaire should be at least 60 percent Filipino-owned.