Power supply contract with Vivant unit above board—Banelco

By Lenie Lectura July 15, 2020

https://businessmirror.com.ph/2020/07/15/power-supply-contract-with-vivant-unit-above-board-banelco/

The Bantayan Island Electric Cooperative (Banelco) on Tuesday said due process was observed in the selection and awarding of a power supply contract to a subsidiary of Vivant Energy Corp.

Banelco said the auction was done via a Competitive Selection Process (CSP), in accordance with Department of Energy (DOE) Circular 2018-02-0003. It added that the CSP was witnessed by DOE, National Electrification Administration (NEA) and National Power Corp. representatives and that policies and guidelines imposed by the Third Party Bids and Awards Committee (TPBAC) were observed.

“We affirm our position that due process was observed in the selection and awarding of the winning bid—a position that is supported by the TPBAC, to which the winning bidders submitted and withstood scrutiny,” said Banelco General Manager Lee Rivera. Her statement comes after Bantayan Island Power Corp. (BIPCor), which has an existing power supply deal with Banelco, slammed the bidding process that occurred in September 2019.

BIPCor alleged that there was an “apparent systematic and coordinated effort to ease BIPCor out as Banelco’s sole power provider at all costs.”

Banelco’s power supply contract with BIPCor expires in November 2021. It participated in the CSP last year but the new contract was awarded to Isla Norte Energy Corp., a joint venture of Vivant Energy and Gigawatt Power Corporation.

“Despite numerous attempts by BIPCor to overturn the TPBAC’s decision to their favor, the winning bidder was clearly and carefully selected at that time,” commented Rivera.

“Notwithstanding these circumstances, we are still under contract with BIPCor until 2021, and we hope that they will still give Banelco— and more importantly, the people of Bantayan Island—the service that they are duty-bound to fulfill. Please rest assured that we at Banelco are working hard to overcome the energy deficit, despite the bureaucratic issues we have to address.”

The island in Cebu is currently experiencing daily rotational brownout mainly due to “constant engine failure of BIPCor.” Rivera said the generating engines of BIPCor are of different brands and that the newly installed gensets are the ones that are always under maintenance.

The power outage incidents started before the CSP. “I also want to stress out that the brownouts that we are experiencing which worsened last March have created an outrage from our member consumer owners mainly because of the failure of BIPCor to provide reliable power supply to Bantayan Island.”

BIPCor has elevated its complaint to the Mandaue City Regional Trial Court Branch 84 but its application for the issuance of a temporary restraining order (TRO) on Banelco’s award of a 15-year, 15-MW power supply contract to Isla Norte Energy was denied.

“Our company is now in the midst of a legal battle to continue our service to households and industries in Bantayan Island with adequate, reliable and sustainable electricity.

We maintain that there was gross violation of the rules governing the grant of PSA, the bidding protocols, and the CSP as mandated by the DOE. Our disqualification from the bidding due to a simple and minor defect in our document—which was not even listed in the Bidding Procedures—was absolutely without basis. Thus, it was highly anomalous and illegal for Banelco to arbitrarily proceed with the grant of the contract to Vivant,” said BIPCor Director Fichte Peñaloza.