Council authorizes mayor to negotiate Asin hydro contract

BAGUIO CITY – The local legislative body approved a resolution authorizing Mayor Benjamin B. Magalong to negotiate and enter into re-contract with the energy department for the renewal of the service contract of the city-owned Asin mini-hydroelectric plants.

The resolution authored by all members of the local legislative body stated one of the legal requirements needed by the energy department is the submission by the local government of a resolution authorizing the local chief executive to enter into a re-contract with the energy department for the renewable service contract of the city-owned Asin minihydro power plants.

The resolution stipulates that the city government is the lawful owner of a series of hydroelectric plants located at barangay Tadiangan, Tuba, Benguet which are currently non-operational due to the absence of a special permit from the energy department.

The three minihydro power plants were operated and managed by the local government for several years after the expiration of its 25-year contract with Davao Lights in 2006 that yielded additional income for the city before it was issued a cease-and-desist order by the Energy Regulatory Commission (ERC) for alleged lack of certificate of compliance in October 2012.

Mayor Magalong recently expressed the urgency of reactivating the operation of the city-owned power plants and has initiated the process of applying for the issuance of a special permit by the energy department to operate the Asin minihydro power plants to maximize its potentials of generating added resources for the local government.

The local chief executive inquired from the energy department on the appropriate guidance on how to fastrack the processing of the renewable energy service contract application of the local government for its Asin minihydro power plants.

In response, Director Mylene C. Capongcol, officer-in-charge of the energy department’s renewable energy management bureau, explained that as per guidance from the agency’s centralized review and evaluation committee, the city government is required to submit its renewable energy service contract application together with the needed documentary requirements, such as copy of the city charter, original copy of the resolution authorizing its representative to negotiate and enter into re-contract with the energy department, and organizational structure of the city government indicating the specific office occupying the position in the table of organization in the city government profile.

The energy department also required the local government to submit a 5-year work and financial plan with the corresponding financial commitments, topographic map and curriculum vitae of the management and technical personnel, aside from submitting the audited financial statement for the last 2 years, current unaudited financial statement, current bank certificate and projected cash flow statement for 2 years.

The energy department mandated the local government to submit all the requirements within 30 days from receipt of the response, otherwise, the city’s application for renewable service contract application for the said sites will be deemed disqualified.

The local government bid out the operation of the power plants that resulted to the declaration of Kaltimex Energy Philippines as the complying bidder but the company failed to operate the same for still unknown reasons to date./Dexter A. See