NAPOCOR allowed to acquire bank credit lines


The Department of Justice (DOJ) has allowed the National Power Corp. (NAPOCOR) to acquire bank loans to support its operations. 

In a statement from the Department of Energy (DOE), the DOJ stated in its Opinion 20, Series of 2022, that the NAPOCOR “has the legal authority to borrow funds or contract loans to fulfill its missionary electrification function in the off-grid areas pursuant to its Charter and the mandate established under Section 70 of Republic Act 9136 or the Electric Power Industry Reform Act of 2011 (EPIRA).” 

“The favorable Opinion will allow the NPC to establish a credit line with local banks that would enable it to manage the fuel price increase that has significantly affected the NPC’s financial position. The funds of NPC sourced from the UCME is not sufficient to support NPC’s current operation,”  Energy Secretary Raphael Lotilla said. 

The DOE earlier sought NAPOCOR’s access to bank credit lines in order to electrify far-flung areas and communities in the country. 

Lotilla said that DOJ’s statement would allow NAPOCOR to ramp up renewable energy projects in the off-grid areas and improve the island-wide transmission in major off-grid islands through public-private partnership arrangements. 

“We express our appreciation to the DOJ for this very timely news. We are also grateful for the support of the entire NPC Board, particularly the Department of Finance as Chairman, the Departments of Budget and Management, Agriculture, Environment and Natural Resources, Interior and Local Government, Trade and Industry, and the National Economic and Development Authority (NEDA) as members,” Lotilla said. 

Under Section 70 of the EPIRA, NAPOCOR is a national government-owned and controlled operation that will conduct missionary electrification through small power utility groups (SPUG). It is also responsible for providing power generation facilities and related delivery systems in areas not connected to the country’s transmission system. 

To date, NAPOCOR’s SPUGs are currently supplying 229 missionary areas across the country. These areas, however, have yet to attain 24-hour power services.