San Miguel Energy Corp. charges PSALM president with plunder

San Miguel Energy Corp. (SMEC), a subsidiary of San Miguel Corp.,(SMC) has lodged plunder charges against the head of the Power Sector Assets and Liabilities Management Corporation (PSALM), the officers of private corporations, and several others in connection with the implementation of a contract for the Sual power station in Pangasinan, which resulted in revenue losses of 14 billion.

San Miguel Energy Corp. filed with the Department of Justice (DOJ) plunder complaints against PSALM President Lourdes Alzona; Suguru Tsuzaki, president of Team Philippines Energy Corporation (TPEC); Kochi Tamura, executive vice

president of Team Sual Corporation (TSC); and several John and Jane Does for violation of Section 3 (E) of Republic Act 3019, the Anti-Graft and Corrupt Practices Act.

In a 20-page complaint-affidavit, SMEC, represented by Elenita D. Go, alleged that Alzona connived with TPEC and TSC by continuing the implementation of a questioned Memorandum of Agreement (MOA).

The controversial MOA was entered into in June, 2009, by PSALM with TPEC and TSC, which served as the independent power producer (IPP) for the Sual Power Station.

The MOA, titled “Memorandum of Agreement in Respect of the Excess Capacity of the Sual Power Station,” gave birth to the concept of “excess capacity” where it was agreed that the Energy Conversion Agreement Contracted Capacity would be 100 MW net per unit.

The MOA gives TSC the right, by or through TPEC, to market, offer, sell, and supply the Nominal Excess Capacity to any customer, independent of and without payment of any fee to PSALM or the National Power Corporation.

In June, 2009, SMEC won the bidding as the SUAL IPP administrator and was granted the rights to 1,000 MW Net Contracted Capacity of the Sual Power Station.

SMEC alleged that they were not able to get the net contracted capacity of 500 MW per unit because TPEC’s 100-MW nominal capacity was given priority in accordance with the 2009 MOA on Excess Capacity.

The complaint said “…the TPEC Trading amount is settled first and kept intact most of the time while the PSALM Trading Trading Amount (for SMEC) is only the balance after the TPEC Trading Amount is deducted from the Total Trading Amount.”

SMEC said it requested PSALM to review the questioned MOA but the latter eventually sided with TPEC and endorsed a pro-rata sharing proposal, saying that SMEC and TPEC should share generation imbalances.