PSALM to bid out 4 power barges on Aug. 15

State-run Power Sector Assets and Liabilities Management Corp. (PSALM) is bidding out again the four diesel-fired power barges on August 15 as the government moves to fast-track the transfer of three of these facilities to Mindanao.

In a statement issued Wednesday, PSALM said it would accept letters of interest from prospective bidders until July 3. A pre-bidding conference will also be held on July 5 to give interested parties an avenue to air concerns and clarify issues regarding the bidding for Power Barges 101, 102, 103 and 104.

According to PSALM, it would still be offering these facilities in three packages with package 1 combining PB 101 and 102, both of which are stationed in Obrero in Iloilo City; package 2 covering PB 103, which is moored in Botongon, Estancia, Iloilo; and package 3 for PB 104, currently located at the Holcim compound in Ilang, Davao City. Each power barge can generate 32 megawatts.

“PSALM is committed to ensure the successful privatization of the power barges not only as part of our mandate but also as the government’s contribution to stabilizing the power situation in Mindanao where the power barges will eventually be transferred,” PSALM president and chief executive Emmanuel R. Ledesma Jr. said.

Ledesma also stressed that PSALM also has the option to enter into a negotiated sale should the second round of bidding fail.

The first bidding conducted by PSALM on May 16 was declared a failure 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 the Phinma-led Trans-Asia Oil and Energy Development Corp.

Prior to the bidding, at least seven groups expressed interest to participate in the bidding, including San Miguel Corp. and First Gen Corp.

The reluctance of the private sector to acquire the power barges stemmed from what it called a “difficult” business environment in Mindanao.

Several groups expressed apprehension in selling electricity in Mindanao, where rates remain lower than the true cost because the government continues to control 81 percent of the power-generation business in Mindanao.

Industry sources earlier expressed concerns that Mindanao consumers would not support a generation rate that would make the operation of the barges viable, as evident in the experience of the Aboitiz-led Therma Marine with its two barges in Mindanao.

The government, however, remained adamant in transferring these barges to help avert an expected 200-MW power supply shortage in the summer of next year. It is thus crucial for these facilities to be in place by February 2013.