Legislature tries to end power project impasse

The Commonwealth Utilities Corporation is set to review a legislation that will support the bid of Marubeni-Sithe on the new 80-megawatt power plant on Saipan as an independent re-evaluation of all proposals gets underway within the next six weeks.

In a meeting yesterday, board members agreed to discuss the proposed measure in executive session to come up with an official position when it gets through the legislative floor for deliberation.

Senate Vice President Thomas P. Villagomez, who also chairs the Public Utilities, Transportation and Communications, said the bill he has initiated will assist in resolving issues that have dogged the stalled project in the last six months.

“This legislation will expedite the whole process,” he said in an interview after the board meeting, citing that the new round of review to be conducted by Burns & McDonnell will still delay the $120 million power plant.

“We are initiating the move now so that hopefully by the time they come out with the power producer, we can just go ahead and support it and there will be no more protest questioning (the decision),” Villagomez explained.

Burns & McDonnell, an engineering firm based in Kansas city, Missouri, has been hired by the government-owned utility firm to conduct a new round of evaluation on all project proposals submitted by 13 companies and determine a “competitive range.”

It will use the “blind evaluation” scheme in which the proposals are identified by numbers, and then rank them based on which offer get the highest score, according to Kaye Delafield, a CUC officer in charge with the re-evaluation.

The engineering firm is anticipating to complete the review within six weeks after which the CUC board has an option to hire their services anew for the final contract negotiations, she told the board meeting.

Responding to questions on whether the process will resolve the issues, Delafield said this will help CUC establish the grounds for selection as well as eliminate the basis for earlier protests.

But board member Ben Sablan expressed worry that the re-evaluation has yet to firm up the scope of the review, asking that they be given a chance to look into the agreement with Burns & McDonnell.

CUC engineers evaluated three companies that responded to the request of proposal issued after the utility company agreed to hire an independent evaluator amid mounting opposition.

“I want to know exactly what deliverables we are getting, exactly to what degree (the re-evaluation will be done),” Sablan said.

The project, designed to meet power shortage on Saipan by the end of the decade, has come under a storm of protests since CUC awarded the contract to Marubeni Corp. of Japan and its U.S. partner Sithe Energies, Inc. last June.

Close competitors Enron and a consortium of Alsons, Tomen, Singapore Power and Tan Holdings Corp. have lodged protests with the public auditor which has held off ruling pending the result of the new evaluation.

The CNMI Legislature hopes to file the proposed bill seeking full faith and credit backing to Marubeni-Sithe to resolve the issue, a move being opposed by other bidders.