State-run National Power Corporation (NPC) has given its concurrence to the proposed divestment of the 246-megawatt Angat hydropower plant to comprise part of the last stretch of the on-going privatization in the country’s power industry.

The crucial decision, however, according to NPC president Froilan A. Tampinco, will be with the Metropolitan Waterworks and Sewerage System (MWSS) given the protocol on the use of water from the dam, which purportedly extends primary consideration to domestic and drinking water -- more than for irrigation and electricity generation purposes.

“If MWSS will ask our help to prepare for the privatization, then we will be willing to work with them,” he stressed.

The Power Sector Assets and Liabilities Management Corporation (PSALM), by edict, will evidently take the lead in the asset’s divestment.

Some issues are being thrown as to the privatization of the Angat power facility, but industry stakeholders said the divestment may be pushed ahead provided clear-cut protocols are set in the bidding terms as to the prioritization of water use from the dam.

The Angat dam is the main source of water supply for Metro Manila and adjacent areas, plus it is utilized for irrigation of farmlands, mainly in Bulacan province.

It was emphasized that the protocol is something that the prospective buyer of the asset must respect. The pecking order for the dam’s water use must be: firstly for domestic use, then for irrigation; and last in the value chain would be for power generation.

If the terms for the water use are clearly delineated, it is believed that the “investors would be able to appreciate the hurdles and have better take on factors to be considered when rolling the numbers for their bids.”

The power generated from the Angat reservoir is expected mainly to underpin the peaking requirements of the Luzon grid.