This developed as the House of Representatives approved the franchise of Transco, the entity to which the transmission assets of the National Power Corp. (Napocor) will soon be transferred.
The passage of the Transco franchise and another bill on special purpose asset vehicles (SPAVs) that would help ease banks’ bad loans, were supposed to have been the purpose of a Senate reorganization that was allegedly engineered by Malacañang.
But by adjourning sine die, the Senate left the two bills docked. Several controversial issues on the cost of energy and economic development financing were also left hanging.
President Arroyo has repeatedly stressed that the two bills are vital to her economic program because the Transco franchise involves the socially sensitive cost of electricity while the SPAV would allow banks to unload bad loans to free more funds for lending to the business sector.
But the purported Palace plan backfired when the opposition pushed the reorganization to include 25 Senate committees and not just two as initially planned by Malacañang.
The plan went more smoothly in the House which approved Transco’s 50-year franchise application.
The passage of the bill paves the way for the government to auction off Napocor’s transmission lines and raise some P2 billion for the government.
The bill was endorsed for approval by the House committee on legislative franchises, chaired by Bukidnon Rep. Juan Miguel Zubiri, and is expected to be immediately forwarded to the Senate for its approval before Congress adjourns its first regular session tomorrow.
The approval of the Transco franchise and another measure on special asset vehicles was supposedly one of the reasons why the opposition was allowed to wrest control of the Senate in a reorganization yesterday.
Right after the bill was approved at the committee level, Zubiri said the grant of the Transco franchise would pave the way for the privatization of Napocor’s transmission lines and other assets.
The transmission lines alone are expected to bring in between $2 billion and $2.5 billion which will be used to pay for part of the $6.5 billion debt of Napocor, he said.
The partial payment of the debt will in turn result in the reduction of the controversial purchased power adjustment (PPA), he added.
Napocor officials have told the Zubiri committee that there are at least six foreign companies interested in bidding for the Transco assets. These include Asea Brown Boveri, a company owned by Hong Kong billionaire Li Kashing, and a French firm.
President Arroyo has also invited Japanese investors to take a look at Napocor’s assets when she visited Japan recently.
Aside from transmission lines, Napocor is required to sell its generation plants to a National Generation Corp. (Genco) under the landmark Electric Power Industry Reform Act. — Jess Diaz, Efren Danao