Lopez’s First Gen bids $176.6M for Calaca power plant

First Gen Luzon Corp. (FGLC), a wholly-owned subsidiary of the Lopez-controlled First Gen Corp., submitted a higher bid of $176.6 million for the 600-megawatt Calaca coal-fired power plant.

The Calaca facility, located in Batangas, is the seventh power asset put on the privatization block by the government.

FGLC said last April 27, the Power Sector Assets and Liabilities Management Corp. (PSALM) declared a failure of bidding after DM Consunji Inc., the only other bidder, submitted its bid at the wrong venue.

After declaring a failed bid, PSALM and the Public Bids and Awards Committee (PBAC) opted to do a transparent negotiated sale process through a three-round open bidding, in agreement with both FGLC and DMCI.

At the end of three rounds, FGLC said it emerged the highest bidder, although both FGLC’s and DMCI’s bid prices were still below the reserve price set by PSALM and PBAC.

The PBAC is composed of representatives from the Departments of Justice, Energy and Finance; National Economic Development

Authority; PSALM; and the Commission on Audit.

"Despite difficulties encountered, we thought that yesterday’s process was very open and transparent. PSALM handled it well," First Gen president Federico Lopez said.

First Gen, Lopez said, believes its bid price would have allowed it to deliver very competitively-priced power to the consumer and reflected the risks associated with a base-load coal plant that still has to seek its own market.

Moreover, it said the company envisioned making significant capital investments to make the plant friendlier to the environment.

First Gen is the largest Filipino-owned independent power generation company in the Philippines with more than 1,727 MW of installed capacity representing approximately 11 percent of total installed capacity.

In March 2005, First Gen took over the operations of the 1.6-MW Agusan hydroelectric plant, which it successfully won when it was privatized by PSALM in June 2004.