Highest bidder has been awarded the contract to generate electricity for Bohol

NOTE: THIS STORY WAS FIRST PUBLISHED IN THE SUNDAY EDITION OF THE BOHOL CHRONICLE.

One of the six bidders for the construction of an independent power plant in Bohol expressed serious concerns about awarding the project to a bidder that had submitted the highest price proposal and was declared by it to be the “lowest calculated response offer” which was One Bohol Power Distribution Utilities (1BP DU ) in May 2021.

The Energy Development Corporation (EDC) was awarded the contract to construct a plant on the island + base load plant outside of Bohol (diesel-Bohol and geothermal-Leyte) after offering a bid price of 5.2168 P/kWh to supply the 83 megawatts ( MW) submitted. Base load requirement of 1 BP for the next ten years.

The price/kWh offered by EDC is 2.18pp higher than the offer of 3.0405p/kWh made by Thermal Visayas Inc. (TVI), which was later withdrawn.

Chairman and President of Bohol Hybrid Energy Corporation (BHEC), Atty. Wilfredo Bacareza, Jr., a Boholano, lamented in an interview on DYRD “Inyong Alagad” on Tuesday, April 12, 2022 that the lowest bidder should win as it would result in lower electricity rates.

“It’s just unfortunate that in this case they’ve awarded the bid to the highest bidder. I have no idea the exact reason. I think some other bidders have protested, but as far as our company is concerned, we have not protested. But the fact is that the highest bidder is the highest bidder,” Bacareza said.

Bacareza pointed out that at the time the winning bid was approved, the price of diesel was in the region of 48p/litre, but with fuel priced at 72p/litre now, the immediate impact will be higher performance rates.

Bacareza’s BHEC offered an asking price of 5.1897 P/kWh, which was lower than EDC’s but higher compared to Manila Electric Co.’s (Meralco) Global Business Power Corporation – 4.5362 P/kWh and SMC Global Power Holdings Corp. by San Miguel Corporation (SMC). ) – P4.5596/kWh.

The other bidder was Solar Philippines Power Project Holdings, Inc. owned by Leandro Leviste, son of former Senator Loren Legarda, now representative of Antique – P3.9297/kWh.

1BP set a price cap of 5.4089 P/kWh for the bidder’s financial bid.

Two bidders — SMC Global Power and Meralco’s Global Business Power — lodged protests before 1BP over apparent misunderstandings regarding the terms of the Statement of Work, but were both rejected by the Competitive Selection Process Committee. Both bidders paid 5 million pesetas as a protest fee.

The pattern of disqualification of the five bidders caught the attention of none other than Department of Energy (DOE) Secretary Alfonso Cusi and Bohol-based members of the National Association of Electricity Consumers for Reform, Inc. (NASECORE).

Cusi has yet to launch an investigation pending a request for details of NASECORE’s offer.

The moves by the Bohol Provincial Government and the Sangguniang Panlalawigan are also drawing public attention as there has been no response despite growing concern from more than 315,000 electricity consumers, 89% of whom are residential.

However, on January 9, 2022, the Chronicle reported that Dino Roxas, General Manager of Boheco 1 and current Chairman of 1BP, confirmed that EDC’s generation rate once the plant is operational is 4.37 P/kWh.

Roxas also explained that EDC’s construction of the Bohol power plant was postponed from December 26, 2023 to June 2024 after being granted a six-month extension due to the delay in the assessment process.

Ten months after a Notice to Proceed (NTP) was served on the winning bidder – the Energy Development Corporation (EDC) – 1BP has yet to file a Joint Energy Regulatory Commission (ERC) petition with the ERC for final approval of the power supply contract (PSA ).

Engr. Danilo Quidlat, head of 1BP’s Joint Technical Working Group (JTWG) told the Chronicle that the electricity price will be pegged to the prevailing geothermal energy price, which is independent of imported oil prices.

The Competitive Selection Process (CSP) used by 1BP aims to achieve the goals of affordable/competitive pricing and availability of power during power island events such as typhoons, earthquakes or when Bohol is off-grid.

The Chronicle learned from reliable sources that when Governor Arthur Yap and 1st District Congressman Edgar Chatto were informed of the bidding results, they called 1BP to declare the winning bid to the highest bidder.

The apparent concern of local government officials stems from the shared responsibility between the 1BP DU and the Bohol provincial government.

1BP clarified to Yap and Chatto that, with the exception of price, the other bidders did not meet a facility’s technical requirements, which is “resilience,” or the ability to quickly recover from a disaster, the operational term for bidders to operate a facility is independent power station in Bohol.

Stakeholders, particularly consumers, who are increasingly demanding information about the price of an independent power plant despite the need for one, is being felt amid another power outage the province is experiencing due to the devastation caused by Typhoon Agaton, which follows Typhoon Odette only source of energy in Leyte. (Chito M. Visarra)

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