Philippines: PSALM sees Malaya plant sale this year

Philippines: PSALM sees Malaya plant sale this year

State-run Power Sector Assets and Liabilities Management Corp. (PSALM)
expects the privatization of the 650-megawatt (MW) Malaya Thermal Power
Plant (TPP) in Rizal to proceed this year to be able to close the sale in
2018, its top official said.

PSALM officer-in-charge Lourdes Alzona said the asset sale remains on
schedule as they are just waiting for the final word on the updated terms of
reference to include the conversion provision of the power plant. "The plant
is scheduled for privatization this year.

But we are waiting for the final wording of final transaction documents,"
she said. "We have an arrangement in the board (to finalize that) until next
month.

" "We can start this year. But in closing the sale, it will slide into next
year.

The bidding process usually takes three to six months," she added. In the
revised terms of reference, the winning bidder of the Malaya plant should
convert it from diesel to coal or liquefied natural gas (LNG).

"The Department of Energy's direction on the plant is to make it a baseload
plant in order to secure our generating capacity," Alzona said. Baseload
power plants are power generating facilities that can operate reliably and
efficiently, generating electricity 24 hours a day, seven days a week.

This can be served by coal, LNG and nuclear plants. Energy Secretary Alfonso
Cusi previously announced the Malaya plant would be rebid in order to
accommodate the agency's request to include the conversion provision in the
terms of reference.

"What the DOE wants is to make sure that when we bid it out, there is really
energy production.That is 600 MW, we want that to replace 600 MW, because
the power plant is counted as an available capacity," Cusi said.

PSALM, the entity created by the Electric Power Industry Reform Act (EPIRA)
to privatize government-owned assets, had set the auction on March 8. The
asset will be sold on an "as is, where is" basis.

The sale has been reset to March 30 and then deferred until further notice
to take into consideration the DOE policy to ensure sufficiency of power
supply in the Luzon grid. Currently, the Malaya TPP, which runs on diesel,
is designated as a must-run unit (MRU) by the DOE to address supply
deficiency when operating power plants in the grid suddenly bog down or
become unavailable.

It will operate as an MRU until the DOE finalizes its privatization
schedule.

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Link to Original Article:
http://www.energycentral.com/news/psalm-sees-malaya-plant-sale-year?utm_medi
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John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com