Solgen summoned to attend House probe on power sector debts

Calida was also requested to provide the House panels with “pertinent documents,” including his office’s “Motion for Leave to Intervene,” in connection with the uncollected PHP14.97 billion and PHP315.42 million from the Manila Electric Company (Meralco) and First Gen Hydro Power Corporation. (File photo: Joy Gumatay via PTV/Facebook)

MANILA – Two panels at the House of Representatives on Friday jointly issued a subpoena to Solicitor General Jose Calida, ordering him to attend a hearing on the nearly PHP100 billion worth of overdue payments power companies and electric cooperatives owe the government.

The House committee on good government and public accountability and committee on public accounts, chaired by Bulacan Rep. Jose Sy-Alvarado and Anakalusugan Rep. Mike Defensor, respectively, ordered Calida to testify at the joint hearing on March 11 after failing to show up at the past hearings in February.

The ongoing congressional investigation looks into the PHP95.42 billion uncollected receivables of the Power Sector Assets and Liabilities Management Corporation (PSALM) from Independent Power Producer Administrators (IPPAs) and electric cooperatives.

Calida was also requested to provide the House panels with “pertinent documents,” including his office’s “Motion for Leave to Intervene,” in connection with the uncollected PHP14.97 billion and PHP315.42 million from the Manila Electric Company (Meralco) and First Gen Hydro Power Corporation.

“It was during these hearings that representatives of several corporations – most notably Meralco, which owes the government close to PHP15 billion – manifested their willingness to immediately settle their obligations to PSALM but were unable to do so because of the motion to intervene filed by the OSG (Office of the Secretary-General),” the panels said in a statement.

“While we welcome the move of those companies who have been persuaded to settle their accounts – noting that these funds belong to the people and will go a long way in ensuring that Philippine’s plan for energy sufficiency and sustainability becomes a reality – there are still those who refuse to heed the President’s call to pay what they owe,” they added.

The House committees noted that cited that one of the biggest unpaid debts is from South Premiere Power Corp. (SPPC), a subsidiary of San Miguel Global Power Corporation, which owes PSALM PHP23.4 billion on the administration of the 1,200-megawatt (MW) Ilijan power plant.

They warned that with the set expiration of PSALM’s corporate life by 2026, these uncollected receivables of the national government could be passed on to the consumers.

“With the impending expiration of PSALM’s corporate life by 2026, there is an extreme urgency to collect the remaining billions of pesos in receivables immediately. Otherwise, the burden from its remaining obligations would unfairly be assumed by the Government and, ultimately and unfortunately, be passed on to the public,” they said.

“This is an unacceptable proposition that the House of the People, under the leadership of Speaker Alan Peter Cayetano, vigorously objects to. Our action is in pursuit of President Duterte’s commitment to ensure the quality, reliability, and affordability of the supply of electric power in the country to provide a safe and comfortable life for all Filipinos,” they added.

The PSALM has vowed to continue its vigorous collection efforts to go after IPPAs with delinquent accounts totaling a whopping PHP33.62 billion following instructions from Finance Secretary Carlos Dominguez III to pursue all legal remedies to compel these IPPAs to pay at once.

If the PHP33.62-billion delinquent accounts remain unpaid by the IPPAs, PSALM will incur an annual borrowing cost of about PHP1.7 billion a year — a substantial amount that could have otherwise been used by the government to spend more on its priority programs on infrastructure and human capital development.

Earlier, Defensor said four power producers have committed to pay their financial obligations to the government amounting to more than PHP23 billion during the House joint hearing.

He said the private firms that committed to pay the financial obligations were Meralco, PHP15 billion; Northern Renewables Generation Corp., PHP4.6 billion; FDC (Filinvest Development Corp.) Misamis Power Corp., PHP2.6 billion; and FDC Utilities Inc., PHP1.2 billion.