Magat Hydro

completed

_x000C_The Magat Hydroelectric plant (Magat HEPP) is a 360MW power plant built at the foot of the Magat dam in the north of Luzon, the Philippines, which has been operational since 1983. The Magat HEPP has been undergoing a privatization process since December 2006 through an international tender process, as part of the privatization program of the Electric Power Industry Reform Act (EPIRA), a comprehensive sector reform law, under which the Power Sector Assets and Liabilities Management Corporation (PSALM) has been created to privatize substantially all of the assets of the National Power Corporation (NPC), the state-owned transmission and generation company. The Magat HEPP is among the country’s few peaking plants in the Luzon grid and is expected to be dispatched largely during peak hours, running primarily as a 100% merchant power plant and selling electricity through the bid-based wholesale electricity spot market (WESM). The proposed IFC investment of a $105 million A Loan will partly finance the privatization of the Magat HEPP. The winning bid of $530 million was tendered by SN Aboitiz Power Incorporated. (SNAP), a 50:50 joint-venture between subsidiaries of Statkraft Norfund Power Invest AS (SN Power) of Norway and Aboitiz Equity Venture (AEV) of the Philippines. This would be the first and only privatization deal successfully concluded with significant foreign participation under EPIRA.