PSALM restructures power supply deals worth P14B

State-run Power Sector Assets and Liabilities Management Corp. (PSALM) has restructured 50 power supply contracts worth about P14 billion, as it aggressively moves to improve the collection of receivables from outstanding accounts and delinquent customers.

In an interview, PSALM president Emmanuel R. Ledesma Jr. said the restructuring program allowed PSALM’s delinquent customers to settle their obligations on installment over several months or years depending on their financial capability.

Under the program, Ledesma added, PSALM offered reduced financing charges, which would benefit both the delinquent customers and their respective consumers as this would ensure that PSALM, through state-run National Power Corp., would continue supplying power to them.

The 50 restructured accounts covered all types of power customers, including electric cooperatives, distribution utilities, industries (as direct customers) and government offices.

The program also covered the outstanding obligations of certain customers whose proposed restructuring terms were approved by PSALM but were yet to be signed by the concerned parties.

According to Ledesma, the restructuring of the P14 billion worth of obligations and interests has resulted in the collection of P1.98 billion from concerned customers as of March this year. Currently, the collection efficiency on both current sales and restructured accounts stood at 95 percent, he added.

For this year, PSALM has continued to pursue a two-pronged liability management program or strategy through financial and asset management to reduce the financial obligations assumed from Napocor. As of end-2011, the outstanding obligations stood at $15.58 billion.

The government, through PSALM, has been trying to bring down its receivables but was having a hard time doing so, with Napocor still managing and operating the remaining government-owned power plants and contracted capacities from independent power producers.

These facilities and contracts have yet to be privatized or sold and turned over to the private sector.