Local conglomerate DMCI Holdings Inc. submitted the highest offer of P17.4 billion at a state auction yesterday for the 600-MW Calaca coal-fired plant.
The highest bid was less than half of the P38 billion the French utility group Suez offered during a similar bid in 2007.
The power plant was abandoned by the Suez group,citing the deteriorated condition of the plant.
Suez’s unit Emerald Energy Corp. returned the power plant to the government in January after its condition deteriorated, forcing the government to hold another auction.
The DMCI offer even exceeded an undisclosed floor price fixed by the state holding firm Power Assets and Liabilities Management Corp. (Psalm), Conrad Tolentino, Psalm spokesman said.
Only two groups showed up to submit their bids. DMCI bested the offer of Thailand’s Banpu Power Ltd., which submitted a bid of $280 million.
San Miguel Corp. (SMC), which earlier indicated it was interested in Calaca, did not submit a bid.
Tolentino said the winner of the auction would be known within a week after all required documents are submitted.
If the sale goes through, the government would have sold 73 percent of the 3,778.23 MW of operating capacity of plants on the main island of Luzon and in the central Visayas region, Tolentino said.
The government aims to sell 70 percent of total capacity, one of the preconditions for open market access and retail competition in the power market.
These measures are aimed at bringing down power rates in the country, known to be one of the highest in the region.
Last month, Psalm rejected bids for contracts to buy the power output of two big coal-fired power plants because the offers were below the minimum price.