Continuing their commitment to realize the reforms outlined in the Electric Power Industry Reform Act (EPIRA), the Power Sector Asset and Liabilities Management Corporation (PSALM) and the National Power Corporation this year entered into an Operation and Maintenance Agreement (OMA).

The OMA proceeds from the mandate under Sec. 49 of the EPIRA for PSALM to take ownership of all existing generation assets, liabilities, independent power producer contracts, real estate, and all other disposable assets of National Power, except those pertaining to the Small Power Utilities Group (SPUG), which will remain with National Power.

The agreement implements Sec. 5(q), Rule 21 of the EPIRA Implementing Rules and Regulations which provides that PSALM may operate the generation assets directly or through National Power prior to the privatization of these assets. The OMA, moreover, facilitates compliance with Sec. 51 of the EPIRA which requires PSALM to optimize the value and sale prices of the assets transferred to it from National Power.

The OMA takes advantage of National Power’s expertise in managing and operating power plants and related facilities as it is tasked under the OMA to efficiently operate, maintain, and manage the PSALM assets.