Napocor still debt-ridden despite EPIRA

AFTER nine years of selling its power plants to settle debts, it’s back to square one for National Power Corp. (Napocor), as the current liabilities of the state-owned company remained as they were in 2001.

In a press conference, Department of Energy (DOE) Secretary Jose Rene Almendras told reporters that Napocor’s financial obligations at end-2009 stood at almost the same level as in 2001, when the company’s debts hit $16 billion, making it the single biggest drag on the finances of the national government.

Almendras said this was despite the sale of nearly all of Napocor’s assets, the proceeds of which were supposed to retire its debts.

The DOE chief however said that the company’s stagnant finances were not because of the sale “ of Napocor assets at a loss.”

Taking his cue from President Aquino’s State of the Nation Address (SONA), Almendras blamed the previous administration’s decision to subsidize the cost of power.

“It was on the price of energy Napocor has made to the market. What the President said [was that] your generation cost was at P10 per kilowatt-hour and yet you’re selling only at P2 per kilowatt-hour,” the DOE chief said.

In his first SONA, the President on Monday scored Napocor’s subsidies from 2001 to 2003, which saddled the government with more debt even as the privatization of its power plants had barely begun.

Mr. Aquino said Napocor’s subsidies were timed before the national elections of 2004, during which then President Arroyo secured a fresh six-year mandate.

As a result of Napocor’s subsidies, Almendras said that future generations of Filipinos would have to pay for the past administration’s inefficiencies through their electricity bills.

Under the Electric Power Industry Reform Act of 2001, proceeds from the sale of Napocor’s assets should be used to pay the company’s. Any remaining amount will be shouldered by consumers under the universal charge component of their electricity bills.

Boardroom perks

The DOE chief said the department is also looking into the boardroom perks of its attached agencies and corporations, after Mr. Aquino’s expose on the incentives that the executives of state-run Metropolitan Waterworks and Sewerage System (MWSS) awarded themselves.

Almendras said he already ordered the accounting of bonuses and other benefits.

”The President wanted to set an example by discussing the MWSS situation. But the instructions of the President are very clear, which is review all attached agencies of the DOE. I have been doing that even before the SONA, it’s just that the numbers of MWSS are much nicer,” Almendras said, adding that his department’s units don’t enjoy benefits that stretch to 30 months’ worth of salaries.

“It’s not that high and we’re not going to absolve anyone as we are reviewing it,” he said.

While granting board members certain financial perks is hardly illegal, ethical questions remain on such practices, he said.

Besides Napocor, other DOE’s attached agencies are the Power Sector Assets and Liabilities Management Corp., Philippine National Oil Co. and the National Electrification Administration. –EUAN PAULO C. AÑONUEVO REPORTER, Manila Times