Energy Secretary Jose Rene D. Almendras has urged the Joint Congressional Power Commission (JCPC) to decide within the year whether the government will proceed with the sale of the 700-megawatt Agus-Pulangi hydropower complex.
“All we need is a decision—whether to sell or not—so we can move on. I cannot accept a status quo,” Almendras said in a recent interview.
According to Almendras, he submitted to the JCPC last year the Department of Energy’s (DoE) plans for either option. Whether the group decides to privatize the facilities or not, the DoE has put forward several proposals that could ensure the increase in the productivity of the biggest hydropower complex in Mindanao, he added.
The energy chief admitted that the decision was “split” with the congressmen pushing for the government to keep the complex, while senators are for its privatization.
Almendras earlier explained that should the Agus-Pulangi hydropower complexes—a crucial power generation asset in Mindanao—be put up for auction, the DoE will include certain provisions in the contract such as five-year condition requirements, trading conditions, ownership conditions, and even technical considerations on the use of must-run and ancillary facilities, which should all be followed strictly.
In case the JCPC decides not to push through with the bidding of the hydropower complexes, the DoE will ensure that the continued ownership of the Agus and Pulangi will not be a burden, Almendras said.
The private sector has since been urging the government to proceed with the outright asset sale of the Agus-Pulangi hydropower complex in Mindanao, noting that any other forms of privatization will not be economically feasible and may even unnecessarily hike power prices on the island.
Ernesto Pantangco, president of the Philippine Independent Power Producers Association, earlier said the proposals by other groups to have an operation and maintenance agreement prior to the sale of the facilities would not work because “you’ll be operating and maintaining a plant that is dilapidated and, as such, there is no incentive to make investments in improving the power plant.”
The proposal, meanwhile, to have a rehabilitate-operate-and-maintain contract will also not work because, under such agreements, the period that will be given to recover investments to be made on the Agus-Pulangi hydropower complex will be short, he added.
Instead, the group is proposing that the sale of the hydropower complex should already come with long-term power supply contracts to make the asset more lucrative for interested buyers.