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Wednesday, July 17, 2024

Maharlika Fund plans to invest in transmission lines

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Maharlika Investment Corp. (MIC), which manages the Philippines’ first sovereign wealth fund, plans to invest in building transmission lines to support the power supply in the island grids.

“Maharlika will be focused on lines, just in the transmission lines. We do not see ourselves investing in the generation side or the distribution side because theoretically when these assets we’re currrently helping build gets connected to the transmission grid, then we will be restricted from investing in either,” MIC president and chief executive Rafael Consing Jr. said.

Consing said during the signing of a partnership agreement with the National Electrification Administration and the Palawan Electric Cooperative (PALECO) that investments are needed more in the transmission development for island grids.

“Also if you look at where investments in the energy sector is most required, it is in lines because there is significant amount of capital that are already interested in developing the generation side, and there is already a significant amount of capital in improving the distribution side. Therefore, we want to be able to make a difference, by focusing only on building island grids,” Consing said.

NEA administrator Antonio Mariano Almeda signed a memorandum of understanding (MOU) with Consing and PALECO general manager Rez Contrivida at the NEA office in Quezon City.

A representative for Palawan 2nd District Rep. Jose Alvarez and National Transmission Corp. (TransCo) president Fortunato Leynes also signed the document as witnesses.

The latest collaboration seeks to stabilize power supply in Palawan to keep attracting businesses and industry in the province for its economic growth.  The parties agreed to mutually provide technical assistance and share relevant data to achieve this goal.

Under the six-page accord, the MIC intends to conduct studies to assess the present electrical system of Palawan and determine ways to improve it.  MIC has the discretion to finance its upgrades, subject to the availability of funding and consistent with its investment strategy and risk management frameworks.

PALECO is bound to extend assistance relative to the implementation of the MOU. It is expected to provide technical and operational expertise, including access to relevant data and information, to its collaborators.

The agreement adheres to the “Bagong Pilipinas” governance agenda of the Marcos administration that seeks to invest the Philippines’ first sovereign wealth fund into key investments-such as energy development-to sustain the positive trajectory of the country’s economy.

Almeda initiated the partnership to accelerate the 100-percent electrification thrust of the NEA and secure electricity supply.

Palawan has struggled with rotational brownouts due to technical issues and power supply deficiency for years, which the state-owned corporation has been trying to address.  NEA forged a similar arrangement with the local governments and electric cooperatives of Oriental and Occidental Mindoro in April 2024.

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