Lawmakers want power plant contract scrapped

Congressmen vowed yesterday to scrap the sale of the P30-billion power plant in Masinloc, Zambales and ask for a new bidding if the winning bidder fails to deliver the $227-million down payment to the government on Friday.

"That is the only logical course of action that the government, through the Power Sector Assets and Liabilities Management (PSALM) Corp., should take if the bidder fails to meet its third deadline on June 30," said Rep. Teodoro Casiño of the party-list group Bayan Muna.

Casiño and other party-list representatives had filed a resolution seeking an inquiry into the sale, the financial capacity of the winning bidder, YNN Pacific Consortium, and the scrapping of the transaction.

He said he still had doubts on whether YNN or its Malaysian financier, Ranhill Bhd, could deliver the $227 million initial payment, which would make up 40 percent of its $562-million total bid for the 600-megawatt Masinloc plant.

He said the "botched" sale of the Masinloc plant is causing embarrassment for the government’s privatization program since it is so far the largest privatization project.

For his part, Nueva Ecija Rep. Aurelio Umali said YNN or Ranhill should not be given another deadline to comply with their financial obligation.

"The bidder should put up or ship out, and the government should conduct a new bidding. Extending the deadline for the fourth time would be detrimental to the interest of the government," he said.

The original deadline for YNN to make the down payment was end of last year. This was extended to March 31 and then to June 30 this year.

Earlier, Lanao del Norte Rep. Alipio Badelles, chairman of the House energy committee and joint chairman of the Congressional Power Commission, said he would recommend the scrapping of the Masinloc sale and the conduct of a new auction if YNN fails to deliver $227 million by this weekend.

Casiño also questioned the reported bailout of YNN by Ranhill Bhd, which reportedly paid YNN owners $8 million to take over the company and the Masinloc power plant.

He said YNN incorporators coughed up only P625,000 in cash to form the company and win the Masinloc bid, and now stand to gain more than P400 million for being a "mere contract broker."

"As we suspected, this is a big swindle," he said.

He said what he is interested in knowing now is whether the YNN-Ranhill deal would cost electricity users more than the P2.80-per-kilowatt-hour that they are paying at present for power produced by the Masinloc plant.

"Masinloc power is one of the cheapest. Would it now come out more expensive on the part of consumers because of this transaction?" he asked. — Jess Diaz