Big power firms eye bulk contract for Unified Leyte geothermal facilities

MANILA, Philippines — Prospective bidders, including some of the biggest players in the local energy sector, have showed up in the pre-bid conference for the 588-megawatt Unified Leyte geothermal facilities, said the state-run Power Sector Assets and Liabilities Management Corp.

The Leyte geothermal plant. www.geothermal-energy.org photo

In a statement, Psalm said 10 companies have expressed interest in the independent power producer administrator (IPPA) contract for the “bulk energy,” which would roughly be about 348 MW.

The state agency identified these firms as DMCI Power Corp.; Aboitiz Renewables Inc.; FDC Utilities Inc. (FDCUI) of the Gotianuns; Global Business Power Corp. of the Metrobank group; Marubeni Corp.; Philippine Associated Smelting and Refining Corp. (Pasar); PowerOne Ventures Energy Inc.; Trans-Asia Oil and Energy Development Corp.; Unified Leyte Geothermal Energy Inc., a wholly owned unit of the Lopezes’ Energy Development Corp.; and Vivant Energy Corp.

Psalm further disclosed that 21 parties, including private power firms, industrial corporations, and electric cooperatives, among others, have expressed interest in IPPA contracts covering “strips of energy” with capacities ranging from 1 MW to 40 MW.

These interested bidders were Aboitiz Energy Solutions, Inc.; AC Energy Holdings, Inc.; APO Cement Corp.; DMCI Power Corp.; Emerging Power Resource Holding Corporation; FDCUI; Global Business Power; Leyte II Electric Cooperative Inc.; and Good Friends Hydro Resources Corp.

Also interested for the strips of energy were LIDE Management Corp.; LIDE-PASAR Power Corp.; Marubeni; Negros Occidental Electric Cooperative Inc.; PASAR; Philippine Phosphate Fertilizer Corp.; PowerOne Ventures Energy Inc.; Renagmec Power Corp. Inc.; Trans-Asia Oil; Unified Leyte Geothermal Energy; Vivant Energy; and Waterfront Airport Hotel and Casino.

“This remarkable turnout of bidders, which notably includes the biggest players in the industry, indicates not only the private sector’s support for the government’s privatization initiatives, but also the private sector’s recognition of the reforms being undertaken by PSALM to ensure that the biddings are conducted in the most professional and transparent manner, consistent with the Aquino administration’s ‘daang matuwid’ policy,” said the agency’s president and CEO Emmanuel R. Ledesma Jr.

“To familiarize themselves with PSALM’s bidding procedures and have a better appreciation of the salient features of this bidding, the prospective bidders attended the pre-bid conferences we scheduled [yesterday],” Ledesma added.

PSALM is bidding out in October the IPPA contracts covering the Unified Leyte geothermal facilities.

IPPAs can win the rights for “strips of energy” ranging from 1 MW up to a maximum of 40 MW. A total of 200 MW, out of the 588MW capacity of the Unified Leyte, will be allocated. PSALM meanwhile will remain the administrator for 40 MW, representing the so-called “security capacity.”

The IPPA for the bulk energy, meanwhile, will have the right to the capacity in excess of the 240-MW sum of strips.

The obligation to trade Unified Leyte’s total output as well as the necessary registration applications required by the Wholesale Electricity Spot Market shall lie solely with the winning IPPA for the bulk energy.

The Unified Leyte Geothermal complex is composed of the 125-MW Upper Mahiao, 232.5-MW Malitbog, and 180-MW Mahanagdong power plants, and the 51-MW optimization plants.  Located in Tongonan, Leyte Province, these facilities are covered by power purchase agreements between state-run National Power Corp. and EDC.