State-run Power Sector Assets and Liabilities Management Corporation (PSALM) once again declared a failure in its attempt to sell the 650-megawatt Malaya Thermal Power Plant (MTPP) in Pililla, Rizal despite cutting its price tag into half.
Pre-qualified bidders Panasia Energy, Inc. and AC Energy declined to submit offers for the MTPP’s third round of bidding, which priced the power plant at Php2.19 billion, 51% less than the Php4.48 billion tag it had during the second round of bidding back in November 2019.
In a letter to PSALM, Panasia said that purchasing the assets is “not financially viable” for them. AC Energy shares the same sentiment, saying that it is “unable to meet” the minimum bid price.
“It is regrettable that despite the reduced minimum price, still no bidder submitted a bid,” PSALM President and CEO Atty. Irene Garcia in a statement.
Despite the failed bids, PSALM vows to continue pushing the sale.
“We will need to get Board approval to immediately commence the negotiated process of privatization. PSALM must exhaust the available legal process to dispose Malaya because we are incurring substantial losses in continuously maintaining it,” Atty. Garcia added.
PSALM, a government-owned and controlled corporation (GOCC), reduced the MTPP’s minimum bid price considering the book value of the power plant and the land around it, the land’s zonal value, the plant’s marketability, the GOCC’s significant losses, and electricity demand.
The MTPP has lost P1.21 billion annually between 2010 and 2019. The Department of Energy has designated Malaya as a must-run unit since 2015.