Tuesday, June 26, 2012

WESM-Mindanao To Address Barges Issues

..MANILA, Philippines --- The establishment of a Wholesale Electricity Spot Market (WESM) in Mindanao is the only solution seen by prospective bidders that will address the market issue hounding the proposed transfer of the power barges being privatized by the Power Sector Assets and Liabilities Management Corporation.

The rebidding for Power Barges 101, 102, 103 and 104 is being scheduled August 15 this year, with pre-bid conference slated this July 5.

During the pre-bid conference, prospective bidders were asked to submit or raise their three major concerns as to the divestment of the power barges.

According to interested parties, these concerns will deal with: The market on the generated capacity of the uprated barges; the specific sites where the facilities will be docked; and securing permits from the host local government units.

After several attempts at reviving investors' interest on its privatization program, PSALM employees are earnestly hoping that the divestment of the barges will finally end up successful.

PSALM is badly in need of an achievement that will salvage its reputation from widely-perceived failure on ''liability management'' as well as on alleged events which company insiders termed as ''bathrobe scandal'' that became the subject of industry talks recently.

When asked about prospects of Solutionssetting up WESM-Mindanao as a market solution for the transferred power barges, Philippine Independent Power Producers Association Inc. (PIPPA) president Ernesto B. Pantangco concurred with the proposal, yet he noted that the spot market shall be aligned with the design already introduced in WESM Luzon and Visayas.

This is in contrast to some proposals that the spot market for Mindanao must be designed as a ''net pool'' or a balancing market as compared to the ''gross pool'' scheme in the other two grids.

Given the scale of ''to-do list'' relating to the power barges' privatization, the interested buyers are also apprehensive over the timeline of transfer being imposed by government. It was gathered that even the bids and awards committee (BAC) for the process is not firmed up until this time.

Many of the prospective takers have sounded off that the relocation of the power barges may not be done before the critical summer months of 2013. ''PSALM has to be more realistic on the timeline, securing permits alone would be extremely difficult,'' sources said.

PSALM first bid out the power barges in May, but the process failed because there was only one group making an offer.

Without improving the privatization terms, it has been noted that PSALM may just be wasting time and resources on the rebid process.