Aboitiz Power eyes bid for IPP contracts

Aboitiz Power Corp. (APC) plans to join the bidding for the independent power producers (IPPs) contracts of the Sual and Pagbilao power plants, a ranking company official said.

Steve Paradies, chief finance officer of Aboitiz Equity Ventures (AEV), the holding company of APC, said they have informed the Power Sector Assets and Liabilities Management Corp. (PSALM) of their interest to participate in the IPP administrators (IPPAs) bidding next month.

“We bought the bidding documents so we can study the prospects of the Sual and Pagbilao power plants,” Paradies said.

PSALM started issuing letters of interest on Nov. 21 for the first batch of IPP contracs that would be assigned to IPPAs.

As planned, PSALM will start bidding the 700-megawatt (MW) Pagbilao and 1,000-MW Sual coal-fired power plants on Feb. 20.

PSALM earlier announced there are at least four groups that have expressed interest to join the bidding for the Sual and Pagbilao contracts.

But Paradies said they are still reviewing carefully the terms of the sale. “We are still in the process of studying the terms. We will know if we will bid once we completed our due diligence,” he said.

APC had been saying it will aggressively bid for National Power Corp. (Napocor) assets and the IPPAs. It has been raising funds to be able to participate in the bidding for these assets.

Under the auction rules, a bidder must submit for both the Pagbilao IPPA and Sual IPPA. The bids are separate and distinct from each other, hence, one bid each must be submitted for the Pagbilao and Sual IPPA.

A bidder can only be declared the winning bidder for either the Pagbilao IPPA or Sual IPPA.

IPPAs are qualified independent entities that will administer and manage the energy output contracted by the Napocor with IPPs operating in Luzon and the Visayas.

Under the Electric Power Industry Reform Act (EPIRA), PSALM is required to appoint IPPAs to manage and control Napocor-IPP plants until such time the contracts expire.

Based on earlier proposals, the IPPAs will handle the contracts of Napocor with combined 4,221 MW capacity.

The IPPAs will be tapped through a competitive bidding with international power industry players and traders targeted as man bidders.