PSALM okays O&M bidding for Casecnan hydro plant

The review committee and the board of directors of state-run Power Sector Assets and Liabilities Management Corporation (PSALM) has approved the proposed competitive bidding for the operation and maintenance (O&M) contract of the 150-megawatt Casecnan hydropower facility.

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In the authority granted last September 7 by the PSALM Board chaired by Finance Secretary Carlos Dominguez III, the government-owned firm was also permitted to immediately commence the bid process for the Casecnan plant’s O&M deal.

With that, PSALM announced it will be issuing the ‘invitation to bid’ on September 16 (Thursday) and the pre-bid conference on September 24 this year.

The state-run firm further conveyed that submission of bids, and the subsequent opening and evaluation of the tenders will be on October 12 this year.

“The objective is for the contract for O&M to begin on November 26, 2021; to give the O&M operator sufficient lead time to familiarize itself with the operations of the CMPP (Casecnan multi-purpose project),” PSALM explained.

The build-operate-transfer (BOT) contract of the Casecnan plant will expire by December this year, paving the way for the revert of the plant's ownership to the government.

It is within that premise that PSALM will be tapping an O&M contractor for the facility to ensure its 150-MW power plant can continue to supply electricity to the Luzon grid.

PSALM President and CEO Irene Besido-Garcia reiterated that “the procurement of an O&M operator will ensure the continuous operations of CMPP upon its turnover from the CE Casecnan Water and Energy Company Inc. to the government on December 11, 2021.”

She further noted that “the engagement of an O&M contractor will not only ensure the generation of energy beyond December 11, 2021, but will also allow the continuation of the irrigation component of CMPP.”

The timeline, she added, “will also allow it (contractor) to mobilize its personnel in preparation for the actual operation and maintenance beginning December 11, 2021.”

After the lapse of the proposed one-year O&M contract for the Ilijan facility, PSALM stipulated that the subsequent step to be undertaken by the government would be to push for its divestment by next year.

“The ultimate plan is to pursue PSALM’s privatization of the CMPP in 2022, consistent with the clear instruction in the Electric Power Industry Reform Act,” the government-owned firm said.

The irrigation component of the facility is under the charge of the National Irrigation Administration (NIA), which is a co-owner of the CMPP. The farmer-beneficiaries are primarily those in the project’s host-communities in Nueva Ecija and Nueva Vizcaya in Northern Luzon.

The Casecnan multi-purpose hydropower facility started its full commercial operations in 2002 after the completion of the project’s development by the Philippine subsidiary of American firm CalEnergy International.