BAGUIO CITY – The winning developer for the rehabilitation of the city-owned Asin mini hydropower plants was given a maximum of six months to secure all the required permits prior to pursuing the programmed works and subsequent operation of the three power plants having a total production of 4.2 megawatts.
Mayor Mauricio G. Domogan said after the signing of the notice of award to CALTIMEX, the winning bidder for the rehabilitation of the mini hydropower plants, it is now their obligation to secure the required permits from the host communities and concerned government agencies before it will proceed with its rehabilitation works.
“If the operator will be able to secure all the permits in less than six months, then they are obliged to initially pay their first year rentals on the sixth month but if they are not able to do so, then they are obliged to pay the one year rental during the seventh month and that the remaining balance will be paid pro-rata throughout the year,” Domogan stressed.
It can be recalled that the three Asin mini hydropower plants ceased operations in October 2012 after the city government failed to secure the certificate of compliance from the Energy Regulatory Commission (ERC) in compliance to the provisions of the Electric Power Industry Reform Act (EPIRA) or Republic Act (RA) 9136.
Under the agreement signed by the city and CALTIMEX, the power operator is expected to pay to the local government around P18 million and that the same is expected to strategy increase depending on the production output of the power plants.
Domogan said the memorandum of agreement will be submitted to the city council for confirmation to allow the power developer to proceed with the rehabilitation of the Asin power plants so that it will be able to operate and generate additional income for the city government.
Baguio City is the only local government in the country that owns power plants like the Asin mini hydropower plants which are part of its income-generating projects.
The power developer is expected to infuse some P700 million up to P1 billion in order to fully rehabilitate and upgrade the Asin mini hydropower plants to generate its full capacity and contribute in the generation of renewable energy that will help reduce the cost of power being charged to consumers of the city from the Benguet Electric Cooperative (BENECO).
The 25-year contract between Davao Lights and the city government for the operating of the Asin mini hydropower plants expired in 2006 and the city government subsequently took over the management of the plants until its eventual stoppage of operation in October 2012 due to the absence of the required COC from the ERC.
The operation of the Asin mini hydropower plants had been subjected to four bidding processes that eventually turned out to be failures until such time that the negotiated bidding turned out to qualify CALTIMEX to undertake the rehabilitation project.
The power developer is also expected to negotiate with affected Ibaloi land owners who are directly and indirectly affected by the operation of the power last and the municipal government of Tuba being the host local government in order to ensure that their shares for the operation of the plants will be given unlike in the previous set up where they were reportedly short-changed that caused them to raise objections on the city’s efforts to bid out the operation of the plants.