Meralco, Batelec II, First Bay buying P500M worth of TransCo assets

Power distributor Manila Electric Co. (Meralco) and two other utilities are buying more than P500 million of sub-transmission assets of state-owned National Transmission Corp. (TransCo), Meralco said in a statement with the Philippine Stock Exchange Tuesday.   On Monday, Meralco signed contracts and agreements to buy all the remaining sub-transmission assets of TransCo within Meralco's franchise area.   The Energy Regulatory Commission earlier this year issued Resolution No. 15, Series of 2011, setting Dec. 31, 2011 as the deadline for buying residual sub-transmission assets.   Meralco said its move to acquire the TransCo assets is in line with the ERC resolution. It is also part of the Electric Power Industry Reform Act (EPIRA) process for TransCo to divest its sub-transmission assets in recognition of the distribution utilities’ franchise rights.   Two sub-transmission asset batches were part of contracts to sell signed by Meralco. The first, known as Batch 4 — including the Dasma-Rosario 115 kilovolt (KV) line, Rosario Substation, Tayabas Substation, and Ternate Substation — is going to be purchased by Meralco alone for P381 million.   Together with the Second Batangas Electric Cooperative (Batelec II) and First Bay Power Corp., Meralco will acquire Batch 5 for P142 million.   Once the sub-transmission assets have been transferred to Meralco, Batelec II and First Bay Power, the distribution utilities will operate, maintain, upgrade and expand the assets to protect their investments while providing their customers a more efficient and reliable electric service.   While the contracts have been signed, the ERC still needs to have a look at the documents and approve the transactions. — VS, GMA News