Consunji firm not keen on joining bidding for Malaya power plant

Published December 21, 2018, 10:00 PM By Myrna M. Velasco

https://business.mb.com.ph/2018/12/21/consunji-firm-not-keen-on-joining-bidding-for-malaya-power-plant/

The DMCI Power Corporation of the Consunji group is anticipated to drop out from the list of bidders for the 650-megawatt Malaya thermal plant that the government will be divesting next year.

The company is among the prequalified bidders in the roll of asset-seller Power Sector Assets and Liabilities Management Corporation (PSALM), a government-run firm privatizing the assets of the National Power Corporation.

But a top executive of the Consunji group hinted to media that they are not likely advancing their interest up to the scheduled auction of the power plant by first half next year.

The source noted “the economics of the plant had not been attractive” – at least that was based on the assessment and due diligence they had on the asset.

PSALM has moved the bidding date on the targeted facility sale – because it will still need to engage a consultant that will draw the reserve price for the plant’s auction.

The Malaya plant is being sold “as is, where is” – which is a retraction from the original plan of the government to require the winning bidder to have it converted into a gas plant upon privatization.

That proposal had so far delayed the facility’s divestment for more than a year, hence, the change in the privatization mode when PSALM re-launched its bidding process for the asset.

Under government charge, the Malaya plant has been lined up as a must-run unit (MRU) or the standby facility that the power system operator can call on for ready dispatch whenever the grid suffers from supply shortages.

With its anticipated transfer into the hands of the prospective private sector owner, the plant is seen most beneficial providing back-up capacity especially with the targeted massive integration of renewable energy resources into the power grid.

The country’s future RE pathway is ushered in by the Renewable Portfolio Standards (RPS), a policy that requires distribution utilities to source certain percentage of their supply from RE generated capacity.