fter emerging from the crippling power crisis that occurred in the early 1990s, the Philippine government embarked on an industry privatization and restructuring program envisioned to ensure the adequate supply of electricity to energize its developing economy. This restructuring scheme is embodied in Republic Act No. 9136, the Electric Power Industry Reform Act (EPIRA). Enacted on 08 June 2001 the EPIRA seeks to ensure quality, reliable, secure and affordable electric power supply; encourage free and fair competition; enhance the inflow of private capital; and broaden the ownership base of power generation, transmission and distribution. The EPIRA restructured the power industry by organizing it into four sectors: generation, transmission, distribution, and supply; and introducing the following major reforms: restructuring of the entire power industry to introduce competition in the generation sector; change from government to private ownership through privatization; and introduction of a stable regulatory framework for the electricity sector. In implementing the restructuring of the power sector, the EPIRA created the Power Sector Assets and Liabilities Management (PSALM) Corporation, a wholly-owned and -controlled government entity, to take over the ownership of all existing generation assets of the National Power Corporation (NPC), independent power producer (IPP) contracts, real estate, and all other disposable assets including the transmission business of the National Transmission Corporation. By the same token, PSALM assumed all outstanding obligations of NPC arising from loans, issuances of bonds, securities, and other instruments of indebtedness. The principal purpose of PSALM, as mandated by the EPIRA, is to manage the orderly sale and privatization of these assets with the objective of liquidating all of NPC's financial obligations in an optimal manner.