By Juzel L. Danganan
MANILA, Nov. 11 (PNA) – SPC Power Corp. was disappointed by the Supreme Court (SC) decision that nullified its win in the Naga Power Plant Complex (NPPC) even as it warned that if not corrected, will set back the construction and introduction of additional new 300-MW capacity in the Visayas grid which has already thin reserves.
“Considering the investments that we already poured in after the award and turnover of the asset, if at all, a change in rules should only be prospective and not retroactive. Business cannot develop properly if the rules change in the middle of the game,” SPC Power Corp. senior vice president Alfredo Ballesteros said Wednesday.
The generation company argued it acquired the 153.10-megawatt (MW) power complex for Php 1.143 billion at a higher rate of 5 percent or Php 54 million than Therma Power Visayas, Inc’s. (TPVI’s) bid of Php 1.088 billion.
He further stressed the bidding rules were clear and transparent, baring the right to top of SPC Power Corp due to an earlier land lease agreement with the bidding-organizer Power Sector Assets and Liabilities Management Corp. (PSALM).
Ballesteros also pointed out the company saw that “PSALM considered the right to top a necessary condition in the sale of the LBGT and its surroundings assets because there are all inter-related and located in the same Naga Power Plant Complex.”
The vice president noted all the bidders accepted its right to top, adding the Department of Justice (DOJ) backed the option as well.
SPC won the land-based gas turbines of the power plant in 2009 through a bidding process held by PSALM.
Ballesteros added the decision might affect the construction of a new 300-megawatt (MW) power plant in the Visayas grid.
PSALM earlier stressed the transaction gives the winning bidder a chance to expand in the surrounding areas of the power plant.
Earlier, the SC declared the transaction as null as “it is not founded on the said lessee’s legitimate interest over the leased premises.”
The high court also said that the right to top option of SPC “had discouraged more potential buyers from submitting their bids, knowing that even their most reasonable bid can be defeated.”
The SC noted the right-to-top resulted in SPC and Therma Power Visayas, Inc. only continuing in the bidding process.
TPVI, a subsidiary of AboitizPower Corp., initially won the bid through its Php 1.08 billion proposal, while SPC came in second with a bid of Php 859 million.
The petition was filed by Senator Sergio Osmena III versus respondents PSALM, former PSALM president and chief executive officer (CEO) Emmanuel Ledesma, SPC and TPVI.
SPC is a joint-venture corporation between Salcon Power Corp. and Korea Electric Power Corp. (KEPCO). (PNA)