Kepco plans to bid for IPP contract of 1,200-megawatt Ilijan natural gas plant

MANILA, Philippines - Power generation giant Korea Electric Power Corp. (Kepco) is planning to bid for the contracted capacities of the 1,200-megawatt (MW) Ilijan natural gas power plant in Batangas.

Kepco’s local subsidiary currently operates the Ilijan facility under a build-and-operate scheme.

Rolando Bacani, Kepco Philippines general manager for business development, said they would bid for the contracted capacity as a whole, adding that they are not in favor of the proposed plan to sell the Ilijan contracted capacity in tranches.

“It will be hard to divide. If there are two new owners, how do you divide that? It’s good if they have a good working relationship. Operationally, it will be hard for us as the IPP (independent power producer) contractor if there are many owners,” he said.

The Kepco official said it would be easier if they would bid for the entire contract since it would be the general direction their new president would like to undertake for the company.

“We are preparing to bid for that but it would also depend on the direction of the new president. We have a new president who will arrive on Monday. Right now, the direction of the outgoing president is to join the IPPA bidding for Ilijan,” Bacani said.

Kepco Philippines’ outgoing president is Hoon Kim while the incoming president is Buk Yeol Lee.

Power Sector Assets and Liabilities Management Corp. (PSALM) president Jose Ibazeta earlier floated the idea of breaking down the contracted capacities of the Ilijan power plant by next year.

“We’re still studying because the capacity is too big. That’s our contracts so we can divide that,” Ibazeta said.

He said splitting the capacities of the Ilijan power plant is “a big possibility” and they plan to bid out the Ilijan contract together with the contracts of the 588-MW Unified Leyte geothermal power plants and the 650-MW Malaya thermal power plant in the first quarter.

But Ibazeta said they still would have to seek the opinion of the prospective bidders. “It would depend on the feedback of the bidders. We will know maybe at the end of the year,” he said.

The Unified Leyte plants include the 125-MW Upper Mahiao plant, 232-MW Malitbog, the 180-MW Mahanagdong plants and the 51-MW Optimization plants.

The bidding next quarter is the third batch of IPP contracts being bid out by the government.

So far, PSALM has privatized the contracted capacities of the Pagbilao and Sual coal plants, San Roque, Bakun and Benguet hydro to IPP administrators or IPPAs.

By next year, PSALM is set to bid out other power assets of the government such as the 150-MW Bacon-Manito geothermal plant, 235.20-MW Bauang diesel plant, 310-MW Navotas I and II diesel plants, Iligan 1 and II diesel plants and the decommisioned 850-MW Sucat power plant.