Extension of PSALM’s Corporate Life Under Republic Act No. 12179

On 18 April 2025, Republic Act No. 12179 (“RA 12179”) was enacted, amending Section 50 of Republic Act No. 9136, also known as the Electric Power Industry Reform Act of 2001 (“EPIRA”). 

Under EPIRA, PSALM Corp. has a corporate life of 25 years, which is set to expire on June 26, 2026. In light of the amendment under RA 12179, PSALM Corp.’s corporate life is extended for an additional 10 years, beginning on June 26, 2026. 

PSALM’s primary mandate remains the orderly sale, disposition, and privatization of National Power Corporation (“NAPOCOR”) generation assets, real estate, and Independent Power Producer (“IPP”) contracts, with the goal of liquidating NAPOCOR’s financial obligations and stranded contract costs.

Furthermore, RA 12179 prohibits PSALM from charging consumers for stranded costs and stranded debts during its extended term, unless such charges were approved by the Energy Regulatory Commission (“ERC”) prior to the enactment of the new law. Upon the expiration of PSALM’s extended corporate life, all its assets, liabilities, and properties will revert to the National Government.

The following table presents a side-by-side comparison of the original and amended Section 50:

FROM

TO

SECTION 50. Purpose and Objective, Domicile and Term of Existence. — The principal purpose of the PSALM Corp. is to manage the orderly sale, disposition, and privatization of NPC generation assets, real estate and other disposable assets, and IPP contracts with the objective of liquidating all NPC financial obligations and stranded contract costs in an optimal manner. The PSALM Corp. shall have its principal office and place of business within Metro Manila. The PSALM Corp. shall exist for a period of twenty five (25) years from the effectivity of this Act, unless otherwise provided by law, and all assets held by it, all moneys and properties belonging to it, and all its liabilities outstanding upon the expiration of its term of existence shall revert to and be assumed by the National Government.

“SECTION. 50. Purpose and Objective, Domicile and Term of Existence. – The principal purpose of the Power Sector Assets and Liabilities Management Corporation (PSALM Corp.) is to manage the orderly sale, disposition, and privatization of NPC generation assets, real estate, and other disposable assets, and IPP contracts with the objective of liquidating all NPC financial obligations and stranded contract costs in an optimal manner.  The PSALM Corp. shall have its principal office and place of business within Metro Manila.  The PSALM Corp. shall continue to exist for a period of ten (10) years from the expiration of its original term on June 26, 2026. All assets held by it, all moneys and properties belonging to it, and all its liabilities outstanding upon the expiration of its term of existence shall revert to and be assumed by the National Government: Provided, That PSALM Corp. shall be prohibited from collecting or charging consumers for stranded costs and stranded debts during its extended corporate life except as otherwise approved by the Energy Regulatory Commission (ERC) prior to the date of the passage of this Act.”

RA 12179 shall take effect fifteen (15) days after its publication in the Official Gazette. The law was uploaded to the Official Gazette website on April 25, 2025.