Finance Secretary and Power Sector Assets and Liabilities Management (PSALM) Corporation Chair Ralph G. Recto has successfully led the privatization of the 733.95-megawatt (MW) Caliraya-Botocan-Kalayaan (CBK) hydroelectric power complex in the provinces of Laguna and Quezon to boost energy supply and prevent power disruptions in Luzon.

The move is in line with President Ferdinand R. Marcos, Jr.’s directive to build a resilient, responsive, and future-ready energy sector that can meet the demands of a growing economy.

“The successful privatization of the CBK power plants is a huge win for everyone. Ibig sabihin po nito ay mas maaasahan at abot-kayang kuryente para sa bawat bahay, negosyo, at pabrika. It is a major milestone for the nation’s energy security and economic stability,” Secretary Recto said.

The CBK complex consists of the 39.52-MW Caliraya hydroelectric power plant (HEPP) in Lumban; the 23.10-MW Botocan HEPP in Majayjay; and the 366-MW Kalayaan I and 367.95-MW Kalayaan II pumped-storage power plants, all located in Laguna.

The CBK power plants, specifically Kalayaan I and Kalayaan II, operate similarly to a huge battery system that can support Luzon’s massive power needs.

Beyond generation, the CBK strengthens Luzon’s energy grid by providing ancillary services and reserve capacity, while having the flexibility to enter into long-term power supply agreements.

The privatization of the CBK hydroelectric power complex is PSALM’s biggest project this year.

The project was officially awarded on July 18, 2025 to the winning bidder, Thunder Consortium, composed of Aboitiz Renewables, Inc. (ARI), Sumitomo Corp., and Electric Power Development Co. (J-Power).

The Aboitiz-led group offered PHP 36.27 billion, outbidding the First Gen Prime Energy Corporation and Korea Water Resources (FGKW) Consortium, which submitted a bid of PHP 19.62 billion.

Thunder Consortium’s offer exceeded not only its competitor but also the reference price set by PSALM.

The Department of Finance’s Privatization and Partnerships Group (PPG) played a critical role in addressing regulatory hurdles and in shaping a competitive and transparent process that yielded exceptional value for government and taxpayers.

The project is currently under a 25-year build-rehabilitate-operate-transfer contract and power purchase agreement between CBK Power Co. Ltd. and the National Power Corp., which will expire in February 2026. The government is expected to turn over the plant to the Thunder Consortium by then.