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By Euan Paulo C. Añonuevo Reporter
The privatization of state-owned
National Power Corp.’s (Napocor) power plants will continue even
at the onset of open access and retail competition in the power
sector, an official of the company said.
Cyril C. Del Callar, Napocor
president, said that despite the House Committee on Energy’s
recent decision to lower the privatization target for this year to
50 percent of Napocor’s total generating assets, the
government’s privatization program will continue even if this
threshold is reached.
“The sale of assets will
continue even beyond the 50-percent target because that is what the
EPIRA mandates. The threshold is not a cap, it is actually the basis
for ushering in open access,” he said.
Under the Electric Power Industry
Reform Act of 2001 (EPIRA), 70 percent of the generating capacity of
Napocor and its contracts with third-party power generators must be
privatized before an open access regime can be set forth in the
country.
In order to hasten the EPIRA’s
implementation, lawmakers have proposed to lower Napocor’s
privatization threshold to 50 percent. This, however, has raised
fears that the state-owned power generating company will retain a
large share of the market once open competition starts.
But Del Callar said that the
government’s privatization program will still push through even
when an open access regime is finally ushered in under a lower
privatization requirement.
“Having a lower threshold for
privatization does not mean that the entire program will stop
there,” he said.
He said that the implementation
of open access would pave the way for greater competition among
retail electricity service providers such as distribution utilities
and electric cooperatives, which, in turn,.”could translate to
lower rates, especially for household consumers.”
He added that as mandated by the
EPIRA, all generation and transmission assets of the government
under Napocor will be fully privatized, albeit through slightly
different modes of disposition. In the case of the generation
assets, these will be sold outright via public bidding, with actual
transfer of ownership.
Transmission assets, on the other
hand, will be privatized on a concession basis, where toperations
are taken over by a private entity but ownership remains with the
government.
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