Jul 8, 2020

PALECO to bid for new independent power producer

PALECO board chairman Jeffrey Tan-Endriga said they will start the bidding even without the approval of the Department of Energy (DOE) of the terms of reference (TOR) they proposed.

The Palawan Electric Cooperative (PALECO) will proceed with its bidding for a new independent power producer (IPP) for the main grid.

PALECO board chairman Jeffrey Tan-Endriga said they will start the bidding even without the approval of the Department of Energy (DOE) of the terms of reference (TOR) they proposed.

Endriga said they can no longer wait for the DOE approval and endorsement because the extended contract with the Old Delta P is due to expire in April 2020.

Old Delta P provides 13-megawatt of power to the main grid, including the existing load of 25 megawatts from DMCI and 15.5 megawatts from the Palawan Power Generation Inc. (PPGI).

“A series of follow up letters had already been sent to DOE to expedite the process, sad to say walang response. Weekly ‘yan nagpapadala kami. Considering that we have the Anti-Red Tape Act (ARTA) Law, iyan ‘yong naging basis natin why we pursue the competitive selection process (CSP) even though na wala pa silang endorsement,” he said.

Endriga said it will be the National Electrification Administration (NEA) that will issue them the “notice to proceed”.

He said PALECO decided to conduct the bidding on June 6, 2018 through a board resolution and sent it for approval to the DOE.

In December 2018, he said PALECO sent the TOR for approval of the NEA and DOE.

“Unfortunately, sa tagal ng proseso, kasi that was 2018 power supply procurement plan natin na 20 megawatts lang dapat. Pero papasok na ‘yong 2019, another five megawatts supposed to be na needed to add. Dito sa bagong TOR na gusto natin i-submit sa kanila, sinasabi na sa tagal ng proseso, kailangan natin dagdagan dahil may additional demand,” he said.

He said another inter-agency meeting was conducted on September 11, 2018, to explain the additional five-megawatts load needed by PALECO, hoping that the notice will be given to them by November.

Without updates received, Endriga said he decided to go to DOE to inquire. However, he was informed that the agency wants some changes in the proposed TOR.

“I was shocked na parang gusto nila baguhin ulit pero sabi ko sa kanila, kung gusto niyo baguhin, dapat kayo na lang. Medyo napikon na rin ako, sabi ko kung kayo ang masusunod and not the inter-agency, bakit pa tayo nag-conduct noon? Dapat pala kayo na lang nag-conduct ng CSP at tatanggapin na lang namin sa Palawan. Pabiro ko salita na may punto sa kanila,” he said.

Endriga said he asked the DOE to put the changes it wanted on the letter, but as of press time, it has not sent anything to them.

“Kaya nag-decide talaga ang board. Noong ni-report ko sa board meeting, medyo sumama ang loob nila. May violation ba tayo, tanong ng board of directors kung hindi susundin ‘yong proseso. Dahil kung susundin, malalagay naman sa alanganin ang ating kooperatiba. Tinanong namin ang legal counsel, may basis naman tayo, ease of doing business, the same time ARTA Law,” he said.

PALECO explained that once the DOE and the NEA approve the TOR, it will be published in a newspaper for bidders to join.

Due to the delay in the approval, he said the PALECO board decided to write a resolution informing DOE, NEA, the National Power Corporation (NPC), Energy Regulatory Commission (ERC), and other concerned agencies, even party-lists involved in electrification, that they could no longer wait.

PALECO stated in the resolution that if the DOE does not want to supervise the bidding, NEA will do.

Endriga said that based on their legal counsel, their basis to proceed for the bidding is the ARTA and Republic Act no. 11032 or Ease of Doing Business and Efficient Government Service Delivery Act of 2018.

Endriga also added that PALECO had already sent out invitations to bid (ITB) and four power providers have already expressed interests to join.
“Actually, may mga existing supplier tayo na nag-manifest din ng interest and some power suppliers sa Visayas and Mindanao. This is a hybrid technology, mix supply ng renewable at conventional technology para at least, ma-lessen ‘yong fossil usage natin,” he said.

“Ginawa natin ito para sa kapakanan ng ating member-consumer owner (MCO) dahil kapag hindi natin ito gagawin, di bale mapagalitan ako ng DOE, kesa mapagalitan ako dito ng ating MCOs. Minarapat kung isugal ang aking position, baka masuspinde ako o ang mga director, kesa mag-suffer ang ating member-consumer sa lalawigan ng Palawan,” he added.

He said that if DOE will still not release a notice to proceed for another bidding for El Nido, PALECO will do the same measure.

Endriga also said that based on their verbal discussion with DOE, the latter wants that PALECO should open the bidding to all IPPs.

“Sabi ko, in what way? Kasi nili-limit lang daw natin sa mga IPP na may experience, kasi ang nakalagay doon sa terms of reference, at least five years of experience in power generation. Gusto nila ipaalis ‘yon, sabi ko bakit? Dito mo malalaman kung expert ang kakontrata mo pero sabi nila , dapat daw baguhan ay puwede raw,” he said.

Endriga said that the expertise of experienced IPPs is needed in a Small Power Utilities Group (SPUG) where PALECO belongs.

He added it will be risky if newbies will be chosen.

“We have another option. While doing this, meron tayong application for certificate of exemption (COE). Pero good for one-year lang. Meron na, as per information from DOE, meron naman tayong mga kaibigan na natatanungan, na-approve na ‘yong COE,” he said.

Endriga said that in COE, any IPPs may participate for a year’s supply.

The extension with the contract of Old Delta P will be only done once, Endriga said.

As its extension contract expires in April 2020, PALECO needs another IPP that will shoulder the load the Old Delta P.

“Malaki ang pinagkaiba ng extension at certificate of exemption, ‘yong dispatch protocol mababago ‘yan. Kasi ‘yong extension kung saan sila naka-dispatch noon, doon pa rin sila, ngayon kasi mawawala na ‘yong dispatch order na ‘yon kasi terminated na ‘yong contract nila. It means a new contract for a year,” he said.

 

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