Malaya Thermal Plant can be privatized this year – DOE

Malaya Thermal Plant can be privatized this year – DOE

The 650-megawatt (MW) Malaya Thermal Power Plant (TPP) in Rizal can finally be privatized after the country’s natural gas policy has been issued, the Department of Energy (DOE) said.

“This year might be the year that Malaya thermal power plant could be privatized. [It should be] converted into LNG power plant or coal plant,” DOE assistant secretary Leonido Pulido said.

The DOE official said that the Power Sector Assets and Liabilities Management Corp. can proceed to privatize the Malaya plant, which should be converted into a liquefied natural gas (LNG) or coal plant by the winning bidder, as the Philippine Downstream Natural Gas Regulation (PDNGR) has been signed by Secretary Alfonso Cusi in December 2017.

“Now that we have the PDNGR, and the creation of the review and evaluation committee for downstream natural gas, the instructions of the [DOE] secretary for PSALM, we can now proceed with the revisions of the TOR (terms of reference) for the privatization of Malaya,” Pulido said.

The PDNGR are the rules and regulations that govern the downstream natural gas industry to develop a market and gain energy security and sustainability.

With the natural gas policy, the country will now have a framework for the gas supply and will be secured for the Malaya plant and other upcoming LNG projects.

“We decided to suspend privatization of Malaya until we could come up with the assurance that there will be future supply and that assurance of future supply is the Philippine Downstream Natural Gas Industry Rules,” Pulido said.

The Malaya Thermal plant is currently designated as a must-run unit (MRU) by the DOE to address supply deficiency when running power plants in the grid shut down or become or unavailable.

Running on diesel, the plant will operate as an MRU until the DOE finalizes its privatization schedule.