TransCo sells P3.05B worth of assets

The National Transmission Corp. (TransCo) has sold some P3.05 billion worth of sub-transmission contracts with the signing of a contract with a consortium of electric cooperatives in North Luzon.

TransCo president Arthur Aguilar said Cagayan I Electric Cooperative (CAGELCO I) and Cagayan II Electric Cooperative (CAGELCO II) entered into a consortium agreement to purchase 165.07 circuit-kilometers of sub-transmission lines and 1,087 structures traversing Tuguegarao-Alcala, Alcala-Magapit-Camalaniugan, Magapit-Sta.Teresita, and Sta. Teresita-Sta. Ana 69-kV lines for almost P83 million.

The recently signed lease purchase agreement is one of the eight divestment contracts amounting to P460.24 million that have been signed this year.

To date, TransCo has divested a total substation capacity of 320 megavolt-amperes (MVA) to 49 distribution utilities through 53 sale packages.

Included in the sale packages are 31 lease purchase agreements with 29 electric cooperatives under concessional terms amounting to about P2.06 billion.

TransCo data showed that the balance of over P990 million represents sales to private distribution utilities.

The approval of the Energy Regulatory Commission (ERC) is required before any divestment agreement becomes effective.

Of these agreements, 23 contracts amounting to P1.32 billion have already been approved by the ERC as of Nov. 15, 2008.

The Electric Power Industry Reform Act (EPIRA) mandates that sub-transmission assets be operated and maintained by TransCo until their disposal to qualified distribution utilities which could take over the responsibility of operating, maintaining, upgrading and expanding the said assets.

Privatizing the sub-transmission assets will, in the long run, be beneficial to power customers.

By purchasing these assets, distributors will be able to improve their operations and expand their franchise area, thereby serving more customers.

TransCo, on the other hand, will focus on improving the reliability and efficiency of the high-voltage transmission network.

Sealing the deal in behalf of their companies were Aguilar, CAGELCO I president Lorenzo Trinidad Jr. and CAGELCO II president Benjamin Agatep.