Lotilla welcomes PSALM extension

ENERGY Secretary Raphael Lotilla welcomed the 10-year extension of the Power Sector Assets and Liabilities Management (PSALM) Corp. for the domestic power sector.

This was after the measure amending Section 50 of the Electric Power Industry Reform Act of 2001 lapsed into law on April 18 sans the signature of President Ferdinand Marcos Jr.

"The extension of PSALM's corporate life would finally allow the rehabilitation of the Agus-Pulangi hydropower complex in Mindanao," Lotilla said in a statement.

He said rehabilitation would bring back at least 400 megawatts of renewable energy and address the safety and flooding risks to nearby communities.

"The Agus-Pulangi rehabilitation was not achieved in the previous administration due to the absence of a viable counterpart given the end of PSALM's corporate life in 2026," he explained.

Lotilla said the enactment of Republic Act 12179 ensures that PSALM would continue and deliver its mandate to privatize its remaining assets.

The law also gives additional time for PSALM to manage its outstanding financial obligations, thus preventing the transfer of its remaining liabilities to the national government in 2026.

"Moreover, this will enable PSALM to secure more favorable borrowing terms and negotiate long-term, advantageous financing arrangements," the energy chief added.