NPC prompts Catanduanes on alterative power supply after contract lapse

Published November 4, 2017, 10:00 PM By Myrna M. Velasco

https://business.mb.com.ph/2017/11/04/npc-prompts-catanduanes-on-alterative-power-supply-after-contract-lapse/

The National Power Corporation (NPC) has prompted Catanduanes that it has alternative sources of electricity supply even after the contract lapse of its servicing power utility with the state-run firm.

The power firm said it cannot automatically renew its lease agreement with First Catanduanes Electric Cooperative, Inc. (FICELCO) because of the government’s rigid procurement rules.

That then prompted NPC to pull out its 3.6-megawatt Marinawa Daihatsu diesel power plant in Bato, Catanduanes.

NPC stressed that “we cannot just renew or extend the lease agreement with FICELCO because government requires public bidding for every divestment of assets, either for sale or lease.” The state-run company’s 10-year lease deal with the Catanduanes power utility expired October 17 this year, and that was the main trigger then of the power facility’s pullout from the area.

NPC thus noted that “during the lease period, the facility was operated by FICELCO’s new power provider,” which is Catanduanes Power Grid, Inc.

Being one of the areas that already embarked on privatization through the offer of first wave areas under the qualifying third party (QTP) system, NPC emphasized that FICELCO is already warranted to ensure its procurement of electricity supply for its customers – including on events when its contracts with power providers would be falling due.

“It is FICELCO’s responsibility to foresee the energy demand growth and tap new power providers for the province,” the state-run power firm emphasized.

NPC further explained that in fact it “should have already been out in the province after the FICELCO’s conduct of competitive selection process in 2007, but since it had problems executing some of its provisions, we have no option but to continue our power generation function.”

The power firm noted though that despite the pullout of its power generating facility, supply-demand situation in the province actually remained stable, which was deemed to have been a positive development.