San Miguel told to settle with PSALM its Ilijan IPP obligations
Energy Secretary Alfonso Cusi said San Miguel Corp. (SMC) pay Power Sector Assets and Liabilities Management Corp. (PSALM) its outstanding balance in the management and control of the Ilijan power plant.
This is despite a case, filed by SMC against PSALM, is being heard in a Mandaluyong regional trial court.
?That is the contract, they have to pay. If they want government to honor the contract, they also have to honor their contract,? Cusi said.
SMC?s subsidiary South Premiere Power Corp. (SPPC) is the independent power producer (IPP) administrator of the 1,200-MW Ilijan power plant in Batangas since 2010.
But in September 2015, PSALM said SPPC failed to pay the outstanding generation payments from Dec. 26, 2012 to April 25, 2015 amounting to P6.46 billion. The state-run firm decided to terminate its IPPA contract.
SPPC, however, said it will not pay any additional amount since claimed it has already settled its obligations amounting to P36 billion in capacity fee and P144 billion in generation payments.
Its non-payment resulted into financial obligations rising to P12 billion in April 2016.
Because of this, SMC sued PSALM and questioned its interpretation of the contract in a Mandaluyong regional trial court.