Transco fails to attract bidders

Energy officials said yesterday that the auction of $2-billion worth of assets of state-run National Transmission Corp. (Transco) had failed after only one bidder showed interest.

Energy Secretary Vincent S. Perez said the government would call a new auction. Interested parties have until Sept. 15 to submit requirements to a pre-qualification process, he told reporters.

The government had sought to raise $2 billion from the sale to pay off part of Napocor’s huge debts.

Under a power sector reform law passed by Congress, the government had to spin-off and sell the transmission assets by mid-year.

Edgardo del Fonso, president of the Power Sector Assets and Liabilities Management Corp (PSALM) assigned to dispose of Napocor’s assets, said the second auction attempt should give other interested parties the time to study further the key aspects of the proposed privatization.

The winner of the auction would be awarded a franchise by Congress to operate the system.

Earlier, energy officials said at least 14 companies including nine entities have expressed interest in the transmission assets. The Energy Regulatory Commission has issued the final guidelines for transmission rates last May, and these should clarify to prospective investors the regulatory regime to be adopted over the next 25 years.

Early this month, Del Fonso admitted that the Transco privatization schedule will be push back to give the prospective bidders more time to study their investments in the transmission fim.

Based on the original privatization blueprint, the privatization of the transmission assets of the Napocor will be done after Congress’ approval of the Transco Bill.

Due to some unforeseen circumstances, PSALM has decided to proceed with the Transco privatization even without the Transco bill.

PSALM has devised a privatization plan which will enable the government to push through with the privatization and assured the future concessionaire/owner that they can just apply for the franchise afterwards. – With AFP