Transco to complete sale of sub-transmission assets in ’05

The state-run National Transmission Corp. (Transco) expects to complete the sale of its sub-transmission assets (STAs) by next year, a top company official said

Transco president Alan T. Ortiz said the company will visit the cities of Butuan and Iligan in Mindanao this week as part of efforts to promote the lease purchase financing scheme for electric cooperatives qualified to buy its STAs.

Ortiz said the campaign follows the firm’s well-received visits in Cebu, Bacolod and Davao since the roadshow kicked off two weeks ago.

"We would really like to move the process forward so we are taking a pro-active approach by going to key cities and disseminating relevant information to qualified coops," he said.

STAs are transmission lines typically rated at 69 kilovolts and below. A total of 7,547 circuit kilometers of lines nationwide will be put up for sale with an estimated value of P5 billion.

The Transco board earlier approved a lease purchase financing program for electric cooperatives which will allow coops a downpayment equivalent to only 20 percent of the selling price to acquire possession of the STAs.

Ortiz said Transco will turn over the responsibility of operating and maintaining these assets to the electric coops upon the signing of the lease purchase contract and the receipt of the downpayment.

The coops will acquire ownership of the assets after they have completed payment of the remaining 80 percent of the selling price by installment basis over a period that should not be more than 75 percent of the remaining life of the assets.

The Development Bank of the Philippines (DBP) is also offering credit facility for STAs expansion and improvement under its rural electrification program.

Ortiz reiterated that selling these STAs will ensure the continued quality, reliability, security and affordability of electric service to end-users.

He added that while the lease purchase scheme is initially being offered to the more than 100 electric cooperatives in the country, Transco will reply to expressions of interest from non-electric coops.

He said that several negotiations with distribution utilities are in the advanced stages.

Transco is waiting for the Energy Regulatory Commission (ERC) to approve its conditional sale contract to the San Fernando Light and Power Corp. which was signed in January this year before finalizing these deals.

"All the parties are waiting for ERC’s approval of the agreement we signed with SFELAPCO as it will used as the template for the succeeding contracts," he said.

Aside from SFELAPCO, Transco also signed conditional sale contracts with private distribution utilities Angeles Electric Corp. and Cabanatuan Electric Corp.