MANILA (UPDATE) - Government's sale of the 246-megawatt Angat Hydro-electric Power Plant (AHEPP) in Bulacan to Korea Water Resources Corp, (K-Water) has been declared valid by the Supreme Court (SC).
In a decision penned by Associate Justice Martin Villarama, Jr. dated Oct. 9 but released to the public only on Wednesday, the high court said the sale does not violate the 40-percent foreign ownership cap provided for in the 1987 Constitution.
The high court said “the construction, rehabilitation and development of hydropower plants are among those infrastructure projects which even wholly-owned foreign corporations are allowed to undertake the Amended Build-Operate-Transfer Law.”
Welcoming foreign investments has been a policy of the government since 1987 based on fiscal incentives provided for the restructuring and privatization of the power industry under the Power Sector Restructuring Program (PSRP) of the Asian Development Bank, the ruling said.
The high court, however, pointed out that the National Power Corp. (NPC), not K-Water, should hold the water permit since the agency has the control over dams and reservoirs.
“We hold that the NPC shall continue to be the holder of the water permit even as the operational control and day-to-day management of the AHEPP is turned over to K-Water under the terms and conditions of the agreement whereby NPC grants authority to K-Water to utilize the waters diverted or collected in the Angat Dam for hydropower generation,” the ruling read.
Under Republic Act (RA) No. 9136, also known as the Electric Power Industry Reform Act (EPIRA), PSALM is mandated to privatize all the assets of the National Power Corporation, including the AHEPP.
K-Water was declared as the winning bidder for the project with its US $440.8 million bid.