San Miguel bags power deal with San Roque hydro plant

San Miguel Corp. won another power deal on Tuesday night after it bagged the right to manage the state’s supply deal with the 345-megawatt (MW) San Roque hydroelectric plant for $450 million. San Miguel, through unit Strategic Power Development Corp., topped the bids of Trans-Asia Oil and Energy Development Corp. of $422.956 million and Pacifica Inc.’s $285.837 million. The diversifying food and beverage conglomerate earlier bagged the so-called Independent Power Producer Administrator or IPPA contract for the Sual power plant in Pangasinan. Amlan Power Holdings Corp., meanwhile, submitted the highest bid for the combined 100-MW capacity of the Benguet and Bakun hydro plants, with its bid of $145.473 million. Amlan bested other bidders Pacifica ($100 million), First Gen Northern Energy Corp. ($73.010 million), Trans-Asia ($36.338 million), and San Miguel ($36 million). Amlan is a consortium of local investors Sta Clara Power Corp. and Vics Amlan (composed of Vivant Corp. and ICS Renewables, Inc.). Aboitiz Power Corp. did not participate in the bidding. "We were not able to pass the documents. We encountered some problems," Luis Miguel O. Aboitiz, senior vice-president of Aboitiz Power, said on Tuesday. The participating companies needed to submit offers for all three hydropower facilities and stood to win as many as they could. The San Roque plant is run by Japanese firm Marubeni Corp. and Korean firm Kansai Electric Power Co. Ltd., while the Bakun and Benguet mini hydro plants are operated by Aboitiz Power. The privatization of management and control of at least 70 percent of IPPA contracts is among the preconditions of Republic Act 9136 or the Electric Power Industry Reform Act of 2001 for "open access" and retail competition in the power industry, wherein consumers can choose their own suppliers. Tuesday’s successful bidding inched up the IPPA privatization level to 44 percent from 15 percent. PSALM breached the 70 percent threshold for the privatization of the state’s generating assets, another precondition for open access, last July after the successful sale of the 600-MW Calaca coal fired plant to DMCI Holdings, Inc. PSALM has yet to announce the bidding schedule for the 340-MW Casecnan Multi-Purpose Hydropower plant in Nueva Ecija, which is operated by the California Energy Casecnan Water and Energy Co., Inc. under a build-operate-transfer contract with the National Irrigation Administration. After the hydro IPPAS, PSALM will put the Ilijan Natural Gas Combined Cycle plant in Batangas, run by Kepco Ilijan Corp., on the auction block, followed by Visayas and Mindanao IPPAs. — BusinessWorld