J-Power

CBK Power (J-Power-Sumitomo) in Philippines

The CBK power complex in Laguna is operated by CBK Netherlands Holdings B.V. (CBKNH), a 50:50 joint venture of Electric Power Development (J-Power) and Sumitomo Corp. The J-Power-Sumitomo consortium acquired CBK from the joint venture of IMPSA (Argentina) and Edison Mission Energy (USA) in 2005; the Kalayaan Power Management Corp was responsible for operation and management. CNK rehabilitated all three plants, completed in 2004, and sold the electric power produced to NPC for a period of 25 years. Nearly half of the purchase price of 23B yen was covered by Japan Bank for International Cooperation (JBIC) and other Japanese banks, the first time that JBIC supported the acquisition of overseas IPP interests by a Japanese company on a project finance basis. In March 2005, JBIC provided a US$100M loan to CBKNH cofinanced with private financial institutions; JBIC also provided political risk coverage. This was the first JBIC project finance provided to support Japanese firms in the acquisition of a concession or operation of an existing IPP project in Asia.

Philippine power privatization 8 years hence

Eight years after the enactment of EPIRA, there has been no effective solution to the problems, old and new, that beset the country’s power industry – e.g., electricity prices continue to soar making the cost of electricity among the highest in Asia; new middlemen, e.g, in guise of IPPAs, will further jack-up prices; NPC/government continues to provide guarantees to new players, e.g., guaranteed markets, fuel subsidies; crippling debt burden; a new era of ‘cross-ownership’ risking ‘sweetheart deals’ among distribution utilities and sister IPPs; ‘uncompetitive market behavior’ in the new electricity market; dismantling of NPC (now down to 20% of the national power grid); increasing exposure of Japanese, Korean, and Chinese state-run utilities in the strategic power sector; shift of power infrastructure financing from public to private sector; violations of trade union rights and unresolved labor issues and that threaten industrial peace and a stable electricity supply. Fundamentally, EPIRA simply transfers the monopoly privileges from the state to ‘unbundled’ interests, both domestic and foreign and not necessarily private, and thus allowing the ‘gains’ to be kept as excess (private) profits and a large percentage plowed overseas, instead of being shared with the consumers and taxpayers through lower electricity rates and a reduced debt burden.

JBIC loan to National Power Corporation (Philippines)

JBIC Provides Export Finance to National Power Corporation of the Philippines (Mar. 26, 2004)

1 Japan Bank for International Cooperation (JBIC; Governor: Kyosuke Shinozawa) signed on March 25 a loan agreement totaling up to 6.8 billion yen with National Power Corporation (NPC) of the Philippines. The loan was co-financed with private banks (Agent bank: UFJ Bank Ltd.).

JBIC loan to CBK Power Project in Philippines

JBIC Provides Project Finance Loan and Political Risk Guarantee for the CBK Power Project in the Philippines First Loan to Support Japanese Firms in Acquiring Concession for Existing IPP Project (March 16, 2005) - 1. Japan Bank for International Cooperation (JBIC; Governor: Kyosuke Shinozawa) signed on March 16 a loan agreement totaling US$100 million with CBK Netherlands Holdings B.V. (CBKNH), in which Electric Power Development Co., Ltd. (J-Power) and Sumitomo Corporation have joint equity stakes. The loan was cofinanced with private financial institutions (agent bank: Mizuho Corporate Bank, Ltd.). Political risk coverage for the cofinanced portion was also provided in the form of a guarantee by JBIC.

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