RAMON Ang-led conglomerate San Miguel Corp. (SMC) maintained it “religiously” pays its dues to the Power Sector Assets and Liabilities Management Corp. (PSALM) despite a legal battle pertaining to the administration of the Ilijan power plant in Batangas.
SMC said in a statement on Thursday that its subsidiary South Premiere Power Corp. (SPPC) has paid PSALM a total of $4.8 billion (P244 billion) in various fees as of October this year for the 1,200-megawatt (MW) natural gas power facility in Batangas.
Ang, president and chief operating officer of SMC, emphasized that SMC religiously pays its obligations to PSALM and honors its contractual obligations under the Ilijan independent power producer administration (IPPA) agreement.
“The records will show that we have paid more than enough, and we religiously abide by our contractual obligation as administrator of Ilijan,” he added.
Ang said PSALM is net cash positive from their deal, having already gained P30 billion from the IPPA agreement with SPPC on the Ilijan plant as of August this year
He said that by the time the contract with PSALM ends in 2022, their company would have paid PSALM a total of about $7.68 billion (P384 billion) in various fees for the 20-year old power plant.
“How can they claim we still have underpayments and that they are losing money under the IPPA agreement?” Ang said.
Earlier, SPPC filed a case against PSALM after the latter terminated its role as IPPA administrator of the combined cycle Ilijan plant, treating it as an administrator in default.
In October, Ang pointed out that PSALM’s insistence on trading the output of the Ilijan power plant on “the spot market is a blatant disregard for the welfare of power consumers who should be shielded from, and not exposed to, its price volatility.”
“The Ilijan power station is used to continuously supply electricity to the grid, including hours when the demand is high. If we sold to the WESM, small consumers would have to pay higher electricity bills,” he stressed, referring to the Wholesale Electricity Spot Market.
Formed in 2003, SPPC’s line of business includes the generation, transmission, and/or distribution of electric energy. SMC is a conglomerate with operations in the fuel and oil, energy, infrastructure, and banking industries.