Saturday, September 17, 2011

DBM releases P1.6B to avert power shortage in SPUG areas

M a l a c a ñ a n g h a s
a p p r o v e d t h e
immediate release of
P1 . 6 2 b i l l i o n t o t h e
N a t i o n a l P o w e r
Corporation, in a bid
t o p r e v e n t a n
i m p e n d i n g p o w e r
shortage in the farflung islands and other off-grid areas
b e i n g s e r v i c e d b y t h e S m a l l P o w e r
U t i l i t i e s G r o u p , t h e m i s s i o n a r y
electrification arm of National Power.
Budget Secretary Florencio B. Abad said the
fund release was made by the Department of
Budget and Management upon the instructions
of President Benigno C. Aquino III himself. Of
the total amount, P1.32 billion will be earmarked
for the fuel and lube requirements of SPUG until
December 2011. Another P140 million will go to
the rental or lease of generator sets in some
SPUG areas, while the remaining P162.5 million
will be allocated for the purchase of spare parts
for SPUG plants, which represent roughly 50
percent of National Power’s unfunded capital
expenditure requirements for 2011.
“The P1.62 billion was immediately released
by the government to urgently address the
National Power’s capability to provide stable
power supply in off-grid areas, some of which
have already experienced sporadic brownouts
due to fuel supply constraints,” Secretary Abad
“ F u r t h e rmo r e , t h e g o v e r nme n t i s n ow
preparing for its next steps in ensuring stable
and affordable power supply to remote areas,”
he added, noting that a fund release for the sitio
electrification project is now being processed.
To recall, National Power had earlier warned
that fuel supply is running low in several SPUG
power plants, resulting in rotating brownouts and
raising prospects that the Corporation may be
forced to stop operating altogether in several
SPUG areas. The fuel problem stemmed from a
too-tight budget, with National Power hardDBM releases P1.6B to avert
power shortage in SPUG areas
pressed to fund its fuel requirements in the
SPUG areas and owing diesel suppliers roughly
P700 million as of end-July.
For hi s par t , Nat ional Powe r Pr e s ident
F r o i l a n A . T a m p i n c o w e l c o m e d t h e f u n d
infusion, saying it will ease National Power’s
present financial difficulties and address the
Corporation’s fuel situation. “We got another shot
in the arm, so to speak,” newspapers quoted the
President as saying. “This is something we will
utilize to tide us over until the end of the year.”
The fund release will be sourced from the
Malampaya Gas Fund, which consists of royalty
fees paid to government for the use of natural
gas from the Malampaya fields in off-shore
Palawan. Earlier this year, National Power also
received an infusion of P2 billion from the said
fund, as reimbursement for advances it had
made for the upkeep of the mothballed Bataan
Nuclear Power Plant.
B y N a t i o n a l P o w e r ’ s e s t i m a t e s , i t h a s
a d v a n c e d r o u g h l y P 4 . 3 7 b i l l i o n f o r t h e
p r e s e r v a t i o n o f t h e BNP P f r om 1 9 8 6 t o
December 2010. The two fund infusions made
to SPUG this year bring to a total of P3.6 billion
the amount that has been released to National
P owe r f r om t h e Ma l amp a y a Ga s F u n d a s
reimbursement for its BNPP advances.

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