The Power Sector Assets and Liabilities Management Corporation (PSALM) has announced that it will no longer push through with the Independent Power Producer Administrator (IPPA) bidding for the Caliraya-Botocan-Kalayaan (CBK) hydropower complex, signaling a shift in its privatization strategy.
Instead of granting private firms the rights to manage the plant’s power output under an IPPA contract, PSALM is now considering an outright asset sale once the facility’s build-rehabilitate-operate-transfer (BROT) contract expires in February 2026. This change could streamline the divestment process but may also cause delays in introducing operational efficiencies from private entities.
According to a report by Manila Bulletin, PSALM President and CEO Dennis Dela Serna confirmed that the agency has officially canceled the privatization of CBK and its eventual rebidding.
The original plan was to auction off the remaining operational contract, allowing the winning bidder to sell the plant’s power output through the Wholesale Electricity Spot Market (WESM) or to third-party buyers. However, the agency’s revised strategy aims for full privatization instead of merely appointing an administrator.
Several local and foreign energy firms had initially expressed interest in the IPPA bidding, including ACEN Corporation, First Gen Prime Energy Corporation, Semirara Mining and Power Corporation, Marubeni Corporation (Japan) and Korea Water Resources Corporation (South Korea).
With the IPPA option off the table, these firms may need to reconsider their investment strategies while awaiting further clarity on PSALM’s asset sale plans. The shift could also delay PSALM’s privatization timeline, which has already seen multiple postponements.
Industry analysts warn that such disruptions could affect PSALM’s mandate to liquidate government-owned power assets, which plays a crucial role in reducing electricity sector liabilities.
Beyond CBK, PSALM is also tasked with the privatization of other key power assets, including the Mindanao coal plant contract and the Agus-Pulangui hydropower complex.
Under its legislative extension until 2036, PSALM has been granted additional time to divest these assets. However, Congress has prohibited the agency from passing on stranded debts and costs to consumers, a key concern for electricity pricing.
Stay updated on PSALM’s privatization efforts and their potential effects on the Philippine energy landscape by following Power Philippines.
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