NEA orders 2 coops to explain procurement process

By Myrna M. Velasco – February 10, 2023, 4:38 PM
from Manila Bulletin

The National Electrification Administration (NEA) has served show cause order to electric cooperatives in Region I, Cordillera Administrative Region (CAR) and Sorsogon for them to explain the alleged “highly irregular process” in carrying out competitive selection process (CSP) on their aggregated power supply procurement.

The specified electric cooperatives had resorted to aggregation of their supply portfolio, and the CSP had been targeted for 130-megawatt capacity contracting to satiate their electricity needs.

CSP is a bidding process undertaken by the distribution utilities, including the electric cooperatives (ECs), so there could be a transparent way for them to contract power supply on a ‘least cost’ manner.

In a statement to the media, NEA indicated that the irregularity in the procurement of the subject-ECs was uncovered during a consultative meeting at the agency on Thursday, Feb. 9.

The electrification agency explained that the allegation was premised on the move of the aggregation’s joint third party bids and awards committee, in which it “declared two (2) failed biddings on June 14, 2022 and December 9, 2023 when the bidders were found short of the requirements as prescribed under the pertinent terms of reference (TOR).”

Because of the declaration of two rounds of failed bids, NEA emphasized that such paved the way for them (ECs) to resort to direct negotiation;” which was supposedly in keeping with the prescriptions of the CSP rules.

The government-run agency contended that “despite the successive failures of the participating bidders in the conducted CSPs to comply with the project’s specifications, the aggregation (of the ECs) still limited negotiations with them.”

NEA noted that when the aggregation committee was quizzed on its preference to pursue direct negotiation with interested parties in the failed rounds of bidding, there was a deeper discovery that a notice of award had already been served to the targeted power supplier.

According to the agency, that prompted NEA Administrator Antonio Mariano Almeda to order the issuance of ‘show cause order’ to the officers of the subject-ECs; for them to explain “why they should not be found administratively liable for having violated the pertinent laws, rules and regulations on the proper conduct and transparency for the procurement and awarding of the project.”

The NEA chief thus decreed that “should ground exist, NEA shall refer the matter to other pertinent agencies for further investigation.”

He maintained that “fairness and transparency in the selection process for the benefit and protection of the member consumers should prevail.”