PSALM to borrow P60B for ’13
State-run Power Sector Assets and Liabilities Management Corp., or PSALM, plans to raise P60 billion to fund maturing obligations and meet other operational requirements for 2013.
In a text message, PSALM president and CEO Emmanuel R. Ledesma Jr. said this was the company’s “net requirement,” after taking into account the scheduled collection of payments for power assets or independent power producer administrator contracts that had been sold and the projected revenues from existing state-owned facilities.
According to Ledesma, the full P60 billion will be raised through on-lending.
“As part of its corporate plan for 2013, (PSALM) expects to reduce the cost of its borrowings by on-lending from the government,” Ledesma said, adding that PSALM would also reduce its overall cost through the adoption of certain financial management strategies, including the effective handling of its receivables from privatization and power sales.
As of end-September this year, PSALM has obligations worth P640 billion ($15.28 billion). Of the amount, P328.9 billion represented actual debts while P311.2 billion referred to lease obligations.
PSALM has been trying to bring down its debt level but was having a hard time doing so, with state-run National Power Corp. still managing and operating the remaining government-owned power plants and contracted capacities from the independent power producers. These facilities and contracts have yet to be privatized or sold and turned over to the private sector.
PSALM is implementing a liability management program and pursuing the sale of the remaining state-owned power assets and contracted capacities. It is working on the recovery of at least P140 billion of the cost of stranded debts from power consumers through the imposition of a universal charge.
At present, the petition to collect the entire P140 billion is pending with the Energy Regulatory Commission.
Under this application, PSALM wanted to collect from power consumers 36 centavos per kWh over the next four years, and a separate 3 centavos per kWh over 15 years.
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