THE Commission on Audit has upheld the validity of Southern Philippines Power Corporation’s (SPPC) claim for payment of contractual obligations against the National Power Corporation (NPC) totaling $5,774,269.75 and P68,644,041.22.
However, the COA deferred its ruling on the question of whether a second government firm, the Power Sector Assets and Liabilities Management Corporation (PSALM), may be held liable together with NPC even if it was not involved in the 1996 Energy Conversion Agreement (ECA).
The claim stems from the construction of a 50MW Bunker C Fired Diesel Power Plant in General Santos City in 1996.
Records showed it was the consortium of Alsons Power Holdings and Tomen Corporation that signed the ECA with the NPC under a Build-Own-Operate (BOO) scheme but SPPC assumed the rights and obligations through an accession agreement undertaking signed on January 31, 1997.
In 2009, SPPC filed a Petition for Dispute Resolution with Energy Regulatory Commission (ERC), which ruled in its favor.
The ERC decision of April 1, 2013 granted SPPC’s petition and held NPC liable for the contracted capacity of 55MW from 2005 to 2010 under the ECA, or 110 percent of the power plant’s nominal capacity.
Dissatisfied, the NPC elevated the dispute before the Court of Appeals and the Supreme Court, both of which upheld the ERC rulings.
At ERC’s recommendation, the SPPC filed a petition for money claim with the COA on June 15, 2020 to compel NPC to pay up.
PSALM was included in the petition as SPPC argued that the former had already assumed the NPC’s liabilities based on RA 9136 or the Electric Power Industry Reform Act (EPIRA) which became law in 2001.
COA Chair Michael G. Aguinaldo and Commissioner Roland C. Pondoc, however, said the question of PSALM’s liability will have to be resolved in a separate decision pending submission by all parties of their respective memorandum.
On the claim against the NPC, the COA said the ERC ruling is now enforceable after it was already upheld by the Supreme Court.
“This Commission finds sufficient basis to rule on the legality of the claim. All things considered, this Commission partially grants this Petition for Money Claim against NPC only, in view of the SC Second Division Decision promulgated on July 4, 2016, which became final and executory on January 16, 2017, as indicated in the Entry of Judgment,” the commission declared.
