[New post] Greedy Oligarchs’ Last Ditch At Derailing Duterte’s Renewable Energy Showcase
sovereignnewspub posted: " In what could have been a historical event, the Laguna Lake Development Authority (LLDA) released last week the list of solar developers who offered the highest and winning bids for the use of 2,000 hectares of the lake water surface. This was"
In what could have been a historical event, the Laguna Lake Development Authority (LLDA) released last week the list of solar developers who offered the highest and winning bids for the use of 2,000 hectares of the lake water surface.
This was participated by forty-three (43) bidders for an auction that was a culmination of the painstaking four-year work which LLDA diligently accomplished to create and ensure a sustainable development program in the Lake.
But why did I frame it in the conditional mood, that is, "could have been"?
Because last April 18, Bilyonaryo.com, came out with an online article alleging that the recently-concluded bidding for the 2,000 hectares of Laguna Lake was a "midnight deal, hurriedly done and kept from public view".
According to Bilyonaryo, "A source said some quarters are questioning 'undue haste' by the LLDA."
The website, however, did not say whether the source was Enrique Razon and his friends, who procured bid documents but did not participate in the bidding.
The gravitas of the black propaganda, however, was so heavy-weighty, that in a jiffy of barely two days, Energy Chairman and Pampanga Rep. Juan Miguel Arroyo immediately called his House committee to conduct a hearing last April 20, purportedly to investigate the LLDA's massive RE project awarded in the middle of the elections.
What caused many pundits to suspect the LLDA ruffled oligarchic feathers, was that Bilyonaryo headlined "LLDA 'midnight deal': Mikey Arroyo's House energy committee to probe Macquarie energy firm's Laguna Lake project."
it appears that the onus of the smear that Bilyonaryo.com dealt targets "Macquarie's Blue Leaf and SunAsia Energy of bilyonaryo Toti Carino and Tetch Cruz Capellan" after grabbing half of the twenty100-hectare blocks for either solar or wind power projects in Laguna Lake.
Bilyonaryo never mentioned that the second winning bid was by Ayala Energy.
Macquarie is impeccable. The Macquarie Group Limited (/məˈkwɔːri/) is a global financial services group. Headquartered and listed in Australia (ASX: MQG). It employs more than 17,000 staff in 33 markets, is the world's largest infrastructure asset manager and Australia's top ranked mergers and acquisitions adviser, with more than A$737 billion in assets under management.
Singapore-based Blue Leaf Energy Asia Pte Ltd has teamed up with local firm SunAsia Energy Inc. Blueleaf is a portfolio company owned by Macquarie's Green Investment Group (GIG), operating on a standalone basis.
No innocent bystander
Mikey Arroyo is of course no uninterested bystander in the issue. Energy runs in his pedigree.
His parents Mike Arroyo and Gloria Macapagal, are today's oligarchic guardian angels of the Department of Energy that has for its Secretary a once presidential protégé Alfonso Cusi, and the Energy Regulatory Commission that has for its chairman, once solicitor-general and justice secretary of her mother, Agnes Devanadera.
That Cusi and Devanadera are in the Duterte's official family is not a disclaimer at this point when never before had the regulation of fuel supply and electric power been to the detriment of the consumers. I am not saying of course that they are running rings around the President, who is most sincere in energy availability at its lowest possible cost, a mandate reaffirmed by no less than the Supreme Court.
As if by slip of the pen, Bilyonaryo also mentioned, "The House also wants to determine why the bidding was rushed by LLDA without coordinating with the Department of Energy and National Grid Corporation of the Philippines."
The DOE connection has already been established, but why the National Grid Corporation of the Philippines? Could it have been Transco that was instead being inferred to include Melvin Matibag in this dirty picture? After all, Cusi is PDP president while Matibag is his secretary-general.
Most insulting to commonsense, was Bilyonaryo's unforgiveable innuendo that LLDA did not coordinate with the Department of Environment and National Resources, when O My God, the chairman of LLDA is none other than the DENR Secretary Jim Sampulna!
For heaven sakes, I was under the impression that the Philippines is facing a mounting energy crisis as the Malampaya gas fields erstwhile supplying 30% of Luzon`s energy consumption, are expected to be depleted by 2024, in aggravation an ever-increasing population, and of host of one of the highest electricity costs in the world and in Southeast Asia, next only to Japan.
Laguna Lake: Ideal location for floating solar-based renewable energy generation.
Early Beginnings & Qualified Delays
To belie implications by Bilyonaryo.com that "undue haste" was observed in this project, I am now updating readers that LLDA began their technical study on The Floating Solar Project in 2018 by awarding four renewable energy developers to put up pilot projects in the different parts of the Lake in the towns of Baras, Los Baños, Bay, and Cardona.
These companies were SunAsia Energy, VENA Power, Solar Phils, and Winnergy.
The experiment sought to examine any potential negative impact on the lake's ecosystem through close monitoring of aquatic life and regular water quality testing. Close monitoring of aquatic life and testing of water quality were undertaken in each testbed site to assess the impact of the floating solar to the Lake's ecosystem.
The favorable results of the one-year study were used by LLDA in formulating the lake use policy for renewable energy. Board Resolution No. 576 was released on January 20, 2020 declaring Laguna Lake open for floating solar use.
Instead of undue haste, the truth may be said that the project met some qualified delays. As the country braced for a total lockdown due to Covid-19 pandemic, the renewable energy development program slowed down in 2020. Activities resumed only after the government lowered its alert level sometime middle of 2020 and partial return-to-work policy was made effective in LLDA.
In October, Board Resolution No. 600 Series of 2021 was issued creating the Renewable Energy Committee (REC) under the Office of the General Manager. More importantly, the Resolution declared the Pre-Determined Area (PDA) of 2000 hectares for renewable energy development.
An indicative map was attached to the Resolution to illustrate the geographical coverage of the PDA stretching from the city of Sta Rosa to the last town of Paete in the eastern part of the Lake.
Bhadla Solar Park is the largest solar park in the world as of 2021, and is spread over a total area of 5,700 hectares (14,000 acres) in Bhadla, Phalodi tehsil, Jodhpur district, Rajasthan, India. The park has a total capacity of 2245 MW.The second largest in the world is the Huanghe Hydropower Hainan Solar Park, a 2.2 GigaWatter, in China's remote Qinghai province. It is the largest, however, in the country.
Bidding Rules
In preparation for the issuance of a Memorandum defining the bidding process, a series of stakeholders' consultation via Zoom were conducted beginning November 11, 2020.
Note in bold letters that the Department of Energy was also consulted on January 29, 2021 in order to have a smooth implementation of the renewable energy program in the Lake.
In February 2022, LLDA published Memo Circular No 2 stating that the grant and allocation of the Renewable Energy Area shall be subjected to bidding with a minimum bid price of Php6/sqm. Section 10.2 of the Memo also declared that an Annual Resource User Fee of Php 4 per sqm, with 2% escalation shall be levied on the Leasee.
Moreover, Section 10.3 wrote that the execution of the Renewable Energy Utilization (REU) Contract is effective for a period of 25 years, with LLDA having the power to review the contract every 5 years.
Finally, the rules compelled the REU Contract Holder to apply for an ECC and all other required permits including but not limited to the RE Contract with the DOE prior to the issuance of Privilege to Operate Renewable Energy (PORE). Only a Filipino owned company may be eligible to participate in the bidding process.
Actual Auction
The "Invitation to Bid" signaled the start of the formal process of the lake lease auction. It was published on March 16, 2022.
Forty-eight (48) interested parties secured bid documents. All prospective bidders attended the pre-bid conference that was scheduled the following week. In the two (2) Bid Bulletins, all questions raised during the pre-bid conference were answered by the REC.
Likewise, the submission of bids was moved to April 11 from the original April 5.
On April 12 and April 13, in the presence of the Auditor from the Commission on Audit, as well as the designated representative of the Philippine Solar Power Alliance, the submitted eligibility documents and financial proposals were opened one-by-one.
All commercial offers by twenty-one (21) eligible companies were publicly announced and recorded by the REC.
In terms of "floating" solar power plant, China has put up the biggest in the world, a 40 Megawatter located on a used reservoir in Huainan city, Eastern China.
Three renewable energy developers namely Vena, Ayala Energy, and SunAsia topped the list with SunAsia Energy securing 10 blocks, Ayala Energy 8 blocks, and Vena 2 blocks.
According to the industry representative of the Philippine Solar Power Alliance, the bidding process was commendable as full transparency was demonstrated by LLDA from the issuance of the BR #600 up till the opening of the bid documents. Mendoza also praised the spirit of partnership with the private sector that the Authority exhibited through the efforts of the Renewable Energy Committee (REC).
The same observation was echoed by the losing bidders IslaSol, Total Power and Equator Energy. They all lauded the professionalism and leadership shown by the REC.
In conclusion, the bidding was not a midnight deal.
It took years of careful preparation, and painstaking effort by the LLDA to implement the program. All issuances were published in major newspapers and stakeholders consultations were organized.
Testbeds were erected in different parts of the Lake to secure hard technical evidence that will serve as the technical basis to open the Lake for floating solar use.
The process was transparent and in accordance with the mandate of LLDA, and took years to complete.
The implication about having the final auction within an election period is infantile. That this auction should have been made during the next administration is cop-out. Had it not been for Covid-19, this whole process would have been completed by 2021.
What comes as a midnight undertaking here is the obstructionism being posed by obviously interested parties leveraging to a fleecing conclusion that is more favorable to them.
This project is a legacy of the Duterte administration to the Filipino people, and has nothing to do with whoever wins in the coming elections.
Part 2 on Tuesday, April 26: Laguna Lake Auction Benefits For Public Interest
WATCH: Why Singapore built one of the world's biggest floating solar farms
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