City preparing to bid out privatization of Asin minihydro power plants

The city government is preparing to bid out the privatization of the rehabilitation, upgrading and operation of the city-owned Asin minihydro power plants following the termination of the contract it entered into with Kaltimex Energy Philippines.

Mayor Benjamin B. Magalong stated that the energy department is extending assistance to the city government in finalizing the terms of reference for the public bidding.

He said that the city government will publish the project’s final terms of reference as soon as this is available for interested companies to signify their intention to join the public bidding that will be scheduled in the future.

The city chief executive claimed there are companies interested to participate in the public bidding for the proposed rehabilitation, upgrading and operation of the city-owned minihydro power plants to ensure its operation and help in maximizing the potentials of the facility in generating renewable power and providing additional sources of income for the local government.

Aside from independent companies who already signified their interest to participate in the project’s public bidding, there are also some companies that are willing to undertake the same through joint ventures and other forms of partnerships.

Baguio City owns the distinction of owning renewable energy plants courtesy of the three Asin minihydro plants that trace back to the American presence in the city.

Earlier, the city government terminated the contract it entered with Kaltimex Energy Philippines because of the alleged failure of the company to take possession of the city-owned minihydro power plants and make the same operational.

The city took over the operation of the minihydro power plants in 2006 after the lapse of the 25-year lease agreement which the city entered with the Aboitiz-owned Hydroelectric Development corporation (HEDCOR) where it was able to manage the same for around 6 years.

However, in 2021, the city was compelled to stop operating the power plants after the Energy Regulatory Commission (ERC) issued a cease and desist order for the local government to first secure the required certificate of compliance from the regulating agency before it will be able to continue the operation of the said renewable energy plants.

The power plants were projected to produce at least 14.2 megawatts of renewable energy after the supposed rehabilitation of the facilities that should have been undertaken by the company that was declared to be the complying and responsive bidder in the public bidding that was conducted in 2014.

The company was supposed to make the plants fully operational after rehabilitating it but it failed to do so over the past several years that compelled the city to already terminate the contract. — Dexter A. See