TransCo sells assets to VECO
The National Transmission Corp. (TransCo) completed yesterday the sale of P172 million worth of subtransmission assets (STA) to Visayan Electric Co. Inc. (VECO).
State-run power grid operators TransCo and VECO, the second largest power distribution firm in the country, agreed to enter into a deed of absolute sale of the assets, the first STA sale in the Visayas area.
In January 2005, TransCo and VECO finalized negotiations for the contract to sell worth P171.75 million — one of the biggest single cash purchases since TransCo’s STA divestment program started in 2004.
The Energy Regulatory Commission (ERC) has approved the sale and as stated in the deed of absolute sale, the ownership, operation and maintenance of the STAs will now be transferred to VECO.
VECO serves more than 275,000 customers in the cities of
The purchase contract signed with VECO involves 5.93 circuit kilometers, 33 line structures and various substation equipment connected to the Banilad-Mandaue and Banilad-Cotcot 69-kilovolt lines.
The Electric Power Industry Reform Act (EPIRA) of 2001 mandates the divestment of TransCo’s STAs or lines typically rated at 69-kV and directly connected to distribution utilities.
TransCo president Arthur N. Aguilar assured power customers that STAs are duly inspected to ensure transparency and adherence to sale process guidelines issued by the ERC.
Aguilar also said broadening the ownership base of STAs would present more opportunities for private sector participation in the electric power industry.
“TransCo encourages qualified private distribution utilities to acquire these lines and upgrade them to make the power system more efficient and reliable. As the new owners, they will be allowed to collect revenues directly from the operation and maintenance of these lines. It is expected that would give the new owners the incentive to continuously improve service for the end-users,” he said.
VECO is owned and managed by the Aboitiz and Garcia families in
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