Cusi to ERC: Bare clear-cut bidding rules on P52-billion VisMin power grid project

By Lenie Lectura – September 7, 2017 

from Business Mirror

Energy Secretary Alfonso G. Cusi on Thursday said he wants the Energy Regulatory Commission (ERC) to issue clear-cut guidelines on the bidding rules involving a multibillion grid interconnection project.

“I asked ERC for the bidding guidelines to be very clear. The guidelines should be laid down by the ERC. I want the consumer groups, the Commission on Audit [COA] and the National Transmission Corp. [Transco] to be part of the Bids and Awards Committee [BAC],” Cusi said.

This, after the ERC issued a provisional authority (PA) to the National Grid Corp. of the Philippines (NGCP) to proceed with its P52-billion Visayas-Mindanao Interconnection Project albeit with conditions.

For one, the proposed project shall be subject to optimization based on its actual use and/or implementation during the reset process for the next regulatory period; NGCP is required to conduct competitive bidding for the purchase of major materials in the implementation of the project; and NGCP’s payment of the permit fee.

“We must exercise transparency in the conduct of the bidding because it will be the consumers who will eventually pay,” Cusi said.

The project involves the interconnection of the Visayas and Mindanao via Cebu and Zamboanga. The converter stations in the Visayas and Mindanao will be in Sibonga, Cebu, and Aurora, Zamboanga del Sur, respectively.  The project is estimated to be completed in 46 months with an estimated cost of a less than P52 billion.

The Visayas-Mindanao interconnection Project is in support of the government’s vision to interconnect the major grids into a single national grid, which is expected to help improve the overall power-supply security in the country as sharing of reserves will already become possible.

The project also aims to reinforce the operation of the electricity market by maximizing the use of available energy resources and additional generation capacities in the Visayas and Mindanao, which include the renewable-energy resources.

“The provisional approval granted to NGCP to implement the Visayas-Mindanao Interconnection Project will enable power-supply importations among the Luzon, the Visayas and Mindanao grids. For instance, the deficiency of supply in [the] Visayas may be supplied by importing power from Luzon or Mindanao.  Hence, this Visayas-Mindanao interconnection will help address the insufficient power supply and will also help optimize the available power supply in the Philippine grid,” ERC Officer in Charge  Alfredo J. Non said.