NINETEENTH CONGRESS OF THE 
REPUBLIC OF THE PHILIPPINES 
Third Regular Session
SENATE
s't-- 
of llj? fr"' ff" i'l
24 AUG-7 P5 36
S. No.
O 122.
Introduced by Senator Ronald "Bato" Dela Rosa
AN ACT
PROVIDING FOR THE CONDONATION OF UNPAID OBLIGATIONS ON THE 
POWER CONSUMPTION OF THE PUBLIC UTILITIES DEPARTMENT - 
OLONGAPO CITY TO THE POWER SECTOR ASSETS AND LIABILITIES 
MANAGEMENT (PSALM) CORPORATION.
EXPLANATORY NOTE
This bill seeks to address a long-standing financial burden faced by the City of 
Olongapo, specifically the unpaid obligations of its former Public Utilities Department 
(PUD) to the Power Sector Assets and Liabilities Management Corporation (PSALM).
Prior to 2013, the PUD was responsible for distributing electricity in Olongapo 
City. Unfortunately, a significant debt was accumulated due to years of non-payment 
to the National Power Corporation (NPC), which PSALM later succeeded. Despite 
collecting payments from consumers, the PUD failed to remit these funds to the power 
generator.
In 2013, the PUD was sold and assigned to the Cagayan Electric Power and 
Light Company, leaving the city government with a debt of Php 4.6 billion. Despite 
efforts to make partial payments, the debt has now ballooned to over Php 7.6 billion 
due to accrued interest and charges. This outstanding debt poses a significant obstacle 
to the city's development. Olongapo City's current annual budget is only around Php 
2.2 billion, a fraction of the amount owed to PSALM. Allocating funds to this debt 
diverts resources from much-needed services like public health initiatives, social 
services, and infrastructure development, among others.
This bill, therefore, proposes condoning the PUD-Olongapo City's unpaid 
obligations to PSALM. This will alleviate the city government's financial burden and 
enable it to prioritize essential services for its residents. By redirecting funds towards 
development projects, the city can improve the quality of life for its citizens and foster 
economic growth. It is important to note that this condonation is not a reward for 
mismanagement but a sensible and realistic solution to a historical problem that


continues to impede the city's progress. This act of compassion will enable Olongapo 
City to move forward and fulfill its potential as a vibrant and prosperous community.
The House of Representatives approved a counterpart bill, House Bill No. 9977, 
on March 19, 2024. The passage of this Senate Bill will complement the House Bill and 
bring much-needed relief to the City of Olongapo and its people.
For the above reasons, the passage of this bill is earnestly sought.
RONAlS^^^^LA ROSA


NINETEENTH CONGRESS OF THE 
)
REPUBLIC OF THE PHILIPPINES 
)
Third Regular Session 
)
t ■ 
• 
• t
tl, f
of It-? f ' ■ 
■'
24 AUG-7 P5 36
SENATE
S. No. 27V2
Introduced by Senator Ronald "Bato" Dela Rosa
AN ACT
PROVIDING FOR THE CONDONATION OF UNPAID OBLIGATIONS ON THE 
POWER CONSUMPTION OF THE PUBLIC UTILITIES DEPARTMENT - 
OLONGAPO CITY TO THE POWER SECTOR ASSETS AND LIABILITIES 
MANAGEMENT (PSALM) CORPORATION.
Be it enacted by the Senate and the House of Representatives of the Philippines in 
Congress assembled:
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Section 1. Upon the effectivity of this Act, all outstanding financial obligations
2 
of the Public Utilities Department (PUD) - Olongapo City to the Power Sector Assets
3 
and Liabilities Management (PSALM) Corporation, including Value-Added Taxes (VAT),
4 
Generation Rate Adjustment Mechanism (GRAM), Incremental Currency Exchange
5 
Rate Adjustment (ICERA), Deferred Accounting Adjustments (DAA) charges,
6 
Automatic Cost Recovery Mechanism (ACRM) fuel, purchased power cost adjustment,
7 
foreign exchange adjustment and true-up adjustment charges representing the power
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consumption of PUD - Olongapo City, are hereby condoned.
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Sec. 2. Within sixty (60) days from the effectivity of this Act, the Department
11 
of Finance (DOF) shall, in coordination with PSALM, promulgate the necessary rules
12 
and regulations for the effective implementation of this Act. Taking into account the
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legislative intent to authorize a condonation of unpaid obligations, the said rules and
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regulations shall not entail additional requirements that shall negate the purpose of
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this Act: Provided, That failure of the DOF to promulgate the said rules and regulations
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shall not prevent the implementation of this Act sixty (60) days after its effectivity:
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Provided, further. That the DOF shall require the PSALM to submit bi-annually a list of
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delinquent accounts and demands made for payment from electric cooperatives and
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other clients.
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Sec. 3. If any provision of this Act is declared unconstitutional or invalid, the
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other parts or provisions hereof which are not affected thereby shall continue to be in
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full force and effect.
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Sec. 4. All laws, decrees, executive orders and issuances, rules and regulations, 
or parts thereof inconsistent with the provisions of this Act are hereby repealed or 
modified accordingly.
Sec. 5. This Act shall take effect after fifteen (15) days following its publication 
in the Official Gazette or in at least two (2) newspapers of general circulation.
Approved,