Auction process to start for ‘clean’ energy deals

THE ENERGY department plans to start later this month the open and competitive selection process (OCSP) for the 24 renewable energy resource areas that will be offered to investors, an official of the Energy department said last week.

“The target is to launch the OCSP on Feb. 23. We’re just working on some final details,” Mario C. Marasigan, director of the agency’s Renewable Energy Management Bureau, said in a text message.

The auction process was originally scheduled to be launched on Dec. 15 last year but was pushed back due to some “minor concerns.”

Mr. Marasigan said the Energy department will make bid documents available to the investors during the launch.

“Once we launch the OCSP, interested investors can start buying the documents and start preparing for their bids,” Mr. Marasigan said.

While other details are yet to be finalized, the official said bid submission deadline will be two months after the OCSP launch.

A three-month evaluation period will follow, after which the Energy department will award the contracts.

The government expressed confidence that the OCSP will yield good results. Mr. Marasigan had said in December there were local and foreign investors that had already indicated interest in the auction.

“The results of our stakeholders consultations in Davao, Cebu and Baguio were all very positive,” Mr. Marasigan had said.

“We got very positive outlook [sic] in local communities and local governments. So we believe that as long as we can do the launch, we’ll have positive results.”

Under the OCSP, the Energy department will offer four geothermal and 20 hydropower sites for development and utilization. Two of the geothermal sites to be offered are in Mindanao, while the other two are in Luzon and the Visayas. The 20 hydropower resources, meanwhile, are spread across the country.

Data from the Energy department showed that as of end-November, the government has already awarded 650 renewable energy contracts since the passage of the Renewable Energy Act of 2008. Projects with capacity totaling 2,500 megawatts (MW) are operational, while 10,040,03 MW are in various stages of development.

Besides the tender planned for renewable energy deals, the department is also in the process of auctioning off petroleum areas under the fifth leg of the Philippine Energy Contracting Round (PECR 5). Launched in May, the PECR 5 offered 26 resource areas -- 11 for petroleum and 15 for coal -- to investors.

A total of seven coal operating contracts were awarded last month.

For petroleum, deadline for service contract applications will be on June 30. Winning bidders will be endorsed to Energy Secretary Carlos Jericho L. Petilla on Sept. 4. Upon endorsement, Mr. Petilla will evaluate the applications and forward them to Malacañang. Petroleum contracts are subject to approval by the President before awarding, as required by Presidential Decree No. 87.

source:  Businessworld