20 May 2020
The Power Sector Assets and Liabilities Management Corporation (PSALM) has managed to successfully lower its financial obligations by P17.7 billion, from the P422.01 billion level as of 01 January 2020 to P404.28 billion as of 14 May 2020. PSALM had sufficient funds to pay all its maturing obligations in the first five months of the year, even those that fell due during the enhanced community quarantine. PSALM’s liquidity was mainly because of its efficient performance in 2019 and in the early months of 2020, and notwithstanding the deferment of substantial revenue collections during the ECQ as ordered by the Energy Regulatory Commission and the Department of Energy on COVID-19.
“PSALM has been paying its maturing debts and IPP obligations, including interest and other charges, despite the ECQ and the deferment of revenue collections from power bills, certain IPPA payments and the Universal Charge. There are certainly serious financial setbacks caused by COVID-19 and the ECQ, but PSALM will not default on any of its maturing obligations,” PSALM President and Chief Executive Officer Irene Joy Besido-Garcia said.
The maturing financial obligations were assumed by PSALM from the National Power Corporation.
PSALM intends to secure a loan of P43 billion from the Development Bank of the Philippines to cover other maturing obligations for the rest of year 2020. PSALM has already obtained the approval of the Department of Finance to implement the first drawdown from the said loan by June 2020. This loan will be needed because, while PSALM anticipates revenues coming from privatization proceeds, power sales, delinquent and overdue accounts collections, and UC Stranded Debts proceeds, these revenues will not be sufficient to cover all the maturing obligations and operating expenses for the rest of 2020.
Corporate Communications Division