Gov’t to rebid 4 diesel-fired power barges

MANILA, Philippines—The government is bent on offering again to the private sector the four diesel-fired power barges as soon as possible as these facilities are crucial in helping avert a possible 200-megawatt shortage in Mindanao by the summer of next year.

Energy Secretary Jose Rene D. Almendras told the Inquirer that the government could not take on the responsibility of rehabilitating Power Barges 101, 102, 103 and 104 and of transferring three of these to Mindanao as it would take a longer time to do so. It was crucial, he said, to have all the four barges operating in Mindanao by February 2013.

“If we follow the government procurement process to rehabilitate barges, I am told it will take longer. So the option is to rebid [the four power barges] and if it fails again, then negotiations can happen,” Almendras said.

“PSALM [Power Sector Assets and Liabilities Management Corp.] is working on it. They will rebid as soon as legally possible in compliance with government procurement guidelines,” the energy chief added.

PSALM declared a failure of the bidding it conducted last May 16 for Power Barges 101, 102 and 103 after only one company submitted an offer. The lone bid came from ACTA Power Corp., a joint venture between the Ayala Group’s AC Energy Holdings and Phinma-led Trans-Asia Oil and Energy Development Corp.

Prior to the actual bidding, there were at least seven investor groups that had planned to join the bidding, including conglomerate San Miguel Corp. and the Lopez-led First Gen Corp.

The reason for their non-participation, according to some of the prospective bidders who asked not to be named, was their concern that Mindanao consumers would not support a generation rate that would make the operation of the barges viable, given the experience of the Aboitiz-led Therma Marine with its two barges in Mindanao.

Therma Marine, which owns and operates Power Barges 117 and 118, faced difficulties in hammering out power supply deals because the cost of electricity generated by its diesel plants was much higher than that produced by the hydropower complexes in Mindanao.

Sources also noted that on top of operating costs, the winning bidder was also required to shoulder the cost of transferring the barges and repairing their mooring sites.