K-Water offered USD440.88M power plant in the sale held yesterday, edging out five other bidders: DMCI Power Corp. (US$188.89M), First Gen Northern Energy Corp. (US$365M), San Miguel Corp. (US$312.5M), SN-Aboitiz Power Pangasinan, Inc. (US$256M), and Trans-Asia Oil & Energy Development Corp. (US$237M).K-Water's bid exceeded the reserve price set by the PSALM board for the Angat HEPP.
PSALM will verify the accuracy, authenticity, and completeness of the bid documents that K-Water has submitted before the company can be formally declared the winning bidder for the Angat HEPP. As soon as the company is officially declared the winning bidder, it will be obligated to operate and maintain the Angat Dam at no cost to the government. Operation and maintenance obligations include keeping the dam compliant with international standards on safety, as well as addressing all structural weaknesses of the dam.
In successfully bidding out the Angat hydroelectric power plant, which operates through the Angat Dam, PSALM stressed that only the power plant component of the dam was privatized. The Angat Dam, which supplies more than 90% of the water requirements of Metro Manila and neighboring provinces, remains the property of the Philippine government.
PSALM also pointed out that there is no correlation between the privatization of the power plant and the water supply from the Angat reservoir, saying that the use of water by the winning bidder for the Angat power plant will be regulated by the National Water Resources Board.
"This addresses any misapprehension that the control over the use of the water from the dam will be left to the discretion of a private entity," PSALM stated.
The power privatization agency explained that the new owner of the Angat HEPP can only use the same water that is already allocated to the Metropolitan Waterworks and Sewerage System (MWSS) for domestic use and the National Irrigation Administration for irrigation purposes.
PSALM also cited the Water Code which stipulates that "in times of emergency the use of water for domestic and municipal purposes shall have a better right over all other uses."
Located in San Lorenzo, Norzagaray in Bulacan, the Angat power plant consists of four main units, each with a 50MW capacity. The units were commissioned between 1967 and 1968. To augment its operation, the plant uses five auxiliary units including two turbines capable of generating a total of 28MW. These turbines are owned by the MWSS and were not part of the bidding.
With the successful privatization of the Angat plant, PSALM's privatization level has hit the 87.82% mark for all its generation assets in the Luzon and Visayas grids.
