Napocor to tap multilateral loans

The National Power Corp. (Napocor) is eyeing the speedy formation of the Power Sector Assets and Liabilities Management Corp. (PSALM) to draw down from the multilateral loans which were tied to the passage of the Electricity Power Industry Reform Act (EPIRA), Napocor president Jesus N. Alcordo said.

"We need to hurry up with the organization of PSALM so that we could negotiate with our multilateral creditors," Alcordo said in an interview.

Based on the law, all assets and liabilities of Napocor will be transferred to PSALM. Within six months after the passage of the Power Bill, PSALM will formulate the privatization plan for both the Transmission Corp. (Transco) and the generation assets of NPC.

Transco, to be wholly-owned by PSALM, will acquire all the transmission sets of Napocor, including the right to operate the national transmission system.

The country’s multilateral creditors, Alcordo said, likely perceive the passage of the Power Act as a positive sign, which will pave the way for the release of about $1 billion in loan for the power sector this year.

However, the Napocor chief said that with the enactment of the power bill into law, the state-run power firm will just serve as an operator of the power plants.