Danessa Rivera (The Philippine Star)
- May 2, 2018 - 12:00am
MANILA, Philippines — Further delay
in the approval of power supply agreements (PSA) will put Manila Electric Co.
(Meralco) and its customers at a serious disadvantage since this will result in
higher costs, company officials said.
This has already been manifested in
the renegotiation of the engineering, procurement and construction (EPC)
contract for the 2x300-megawatt (MW) coal-fired power plant in Subic, Zambales
under Redondo Peninsula Energy Inc. (RP Energy), Meralco president Oscar Reyes
said.
“Just on the power supply
agreements, the additional penalty of prejudice of these delays and passage of
time results in significant increase in project cost because of depreciation -
the weakening of the peso or increased cost of materials,” he said.
“It also gives the EPC contractor
the opportunity to review their pricing and to ask for a higher price at the
end of the validity period,” Reyes said.
The EPC contract of RP Energy — a
consortium composed of Meralco subsidiary Meralco PowerGen Corp. (MGen),
Aboitiz Power Corp. and Taiwan Cogeneration International Corp. — with
contractors Korean firm Doosan Heavy Industries & Construction Co. Ltd. and
local company Azul Torre Construction Inc., expired end-December 2017.
RP Energy failed to issue a
notice-to-proceed to Doosan pending the approval of the PSAs by the Energy
Regulatory Commission (ERC).
It received the updated EPC contract
from Doosan last month which contained higher cost, MGen president and CEO
Rogelio Singson said.
“They had to submit a new EPC
contract. It’s definitely much higher than the extended contract. We’re just
looking at the completeness of the scope until we have that full discussion
with them,” Singson said.
Meanwhile, RP Energy is undertaking
clearing operations at the power plant site and has committed to the Subic Bay
Metropolitan Authority (SBMA) “to protect the area from any environmental degradation.”
In the case of subjecting the
pending PSA to a Swiss challenge, Singson said the PSA applications submitted
to the ERC have gone through the full process prescribed before the
implementation of the competitive selection process (CSP) policy — which
requires DUs and ECs to undertake competitive bidding to secure PSAs with
generation companies.
Energy Secretary Alfonso Cusi
earlier said Meralco’s PSAs must be subjected to competitive bidding to resolve
issues and concerns of skirting the government’s CSP policy.
“From my point of view, it would be
best to subject it to Swiss challenge if they’re confident of the cost because
I’m representing the public,” he said.
The seven PSAs of Meralco — which
involve 3,551 megawatts (MW) of supply from coal-fired power plants — did not
go through competitive bidding and were filed a day before the CSP policy took
effect on April 30, 2016.
No comments:
Post a Comment