Napocor losses can hit PhP65B next year
Tuesday, November 09, 2004
By IRIS CECILIA C. GONZALES, Reporter
State-owned National Power Corporation (Napocor) will lose about PhP60 billion to PhP65 billion next year if regulators will not allow it to raise electricity prices.
This is according to estimates by the Development and Budget Coordinating Committee, which met last week to discuss different scenarios on how to pay the power firm's debts.
A government official said unless the Energy Regulatory Commission would grant the balance of Napocor's petition for a PhP1.87 per kilowatthour rate increase, the power firm would remain buried in debt.
The commission has so far approved a 98-centavo increase.
A Bangko Sentral official, in a separate interview, said the commission was willing to grant a full increase, but only after it could go through the financial statements of Napocor.
The source said the Commission on Audit was holding on to the audit report on Napocor.
"The [commission] is willing to grant the increase but it wants first to see the financial statement of Napocorthat has not been given yet," the central bank official said.
"Every day that they do not approve the rate increase translates to PhP166 million in losses," the official added.
Last year, Napocor lost more than PhP117 billion.
Bangko Sentral Governor Rafael B. Buenaventura earlier said a full rate increase would make Napocor more attractive to investors.
Napocor debts account for more than half of the consolidated public sector deficit, now about 6.7% of gross domestic product or total economic output.
The budget coordinating committee discussed three ways for the government to absorb Napocor debts in the form of official development assistance loans and commercial loans. On way is to absorb the principal and maturity payments on Napocor bonds.
Napocor's debts have ballooned to PhP500 billion, and the government plans to absorb PhP200 billion initially.
"We will take care of the PhP200 billion first, then the rest later," Finance Secretary Juanita D. Amatong has said.
The government has had a difficult time selling Napocor to private investors because it has been losing money.
posted by philpower @ 5:38 PM,
