3 January 2010 - Philippines state-owned Power Sector Assets and Liabilities Management Corporation (PSALM) said it would privatize at least two power plants and award two contracts for third-party generating plants in the first quarter of 2010.

Conrad Tolentino, PSALM vice president, said up for sale are the 246 MW Angat hydro power plant and 150 MW Bacon-Manito geothermal power plants.

PSALM also will bid out the contracted capacities of National Power Corp. (Napocor) with the 1200 MW Ilijan natural gas power plant and the Unified Leyte geothermal complex.

"We're hoping to take out more assets in the first quarter," he said.

The Ilijan plant is under a build-operate-transfer (BOT) contract between Napocor and Korea Electric Power Corp. (Kepco).

The Unified Leyte plants — which include the 125 MW Upper Mahiao, 232 MW Malitbog, 180 MW Mahanagdong plants and the 51 MW optimization plants — are under contract with Energy Development Corp.

The privatization of these facilities will entail the selection of an independent power producer administrator (IPPA) who will take over the marketing and control of Napocor's contracted capacities.

PSALM is also looking into the possibility of privatizing the IPPA contract for the 650 MW Malaya thermal plant by the first quarter.

"For the IPPAs, we're targeting Ilijan, Unified Leyte, and we're studying Malaya," Tolentino said.

Kepco also operates the Malaya plant under a BOT agreement with the government.

The PSALM official said that the disposal of the said IPPA contracts would help the agency hit the 70 per cent privatization threshold for Napocor's contracted assets.

Once PSALM hits this threshold, open access will begin in the power sector. Under this set up, power plants may offer their output directly to customers, instead of the current practice of distribution utilities sourcing their electricity needs.