Monte Oro Grid assures adequate power once it takes over TransCo

The consortium of Monte Oro Grid Resources Corp. which tendered the highest bid for the 25-year concession of the country’s national transmission grid, has assured the public of adequate and reliable power supply once it takes over the operations of the system.

Monte Oro, backed by businessman Walter Brown and ports operator mogul Enrique Razon,  issued this statement after it was confirmed Friday by the Power Sector Assets and Liabilities Managemen Corp. (PSALM) as the winning bidder for the National Transmission Corp. (TransCo). 

Monte Oro and its partners State Grid of China and Calaca High Power Corp. tendered a bid price of $3.95  billion while the consortim of San Miguel Energy Corp. and partners Dutch firm TPG Aurora BV and Malaysia’s TNB Prai Sdn Bhd offered $3.905 billion.

Monte Oro said it will shortly form and register with the Securities and Exchange Commission (SEC)  a  new company that will serve as the corporate vehicle for the project. After which, the joint venture company will  apply for a franchise in Congress.

The consortium has assured the Congress and the Filipino people that it has the track record, technical and financial capability to ensure better and more efficient utilization of the national transmission grid which will ultimately lead to better quality power.

“Once the concessionaire finally takes over operation and maintenance of the national transmission system, the country can expect ample and reliable power supply brought about by the improved utilization of TransCo’s equipment and facilities,” the consortium said.

“At present, TransCo’s transmission grid lacks the capability to transport all the available power being generated by the National Power Corp. (Napocor) and other independent power producers (IPPs). The consortium will not only work towards improving reliability and system security but also strengthen and expand the capacity of the national transmission grid,” the group added.

The consortium cited  TransCo’s aging power lines as among the problems hounding  the grid’s operation.

A tripping of one major line, for example, will cause brownouts or blackouts in huge areas, the group said.

To avert these problems, the consortium — as mandated by Section 21 of the Electric Power Industry Reform Act (EPIRA) — will immediately implement various improvement projects approved by the Energy Regulatory Commission upon securing the franchise. The law requires the consortium to comply with the Grid Code and the Transmission Development Plan as approved.  

Monte Oro  will pay 25 percent downpayment of the total bid once franchise is granted and  pay the remaining 75 percent in the next 20 years.

The consortium will shell out $725 million until 2010 to upgrade and modernize the facilities of TransCo to be able to sustain the uninterrupted supply of power to customers.