80-MW power plant faces another hitch • CUC’s plan to alter project may stall selection of contractor

The board of the Commonwealth Utilities Corporation may not decide yet on the final contractor to build the Saipan power plant while considering an option to scale back the controversial project, according to officials.

A meeting, which was rescheduled for today after it was postponed last Friday due to lack of quorum, is expected to discuss the fate of the project, but it is not clear whether final decisions will be made.

A board member, who spoke on condition of anonymity, said they are weighing seriously a proposal to downsize the capacity of the plant to less than 80 megawatts as initially planned.

They are also poised to consult experts regarding such possibility, he said, although the move may further delay construction of the new plant on the island.

Asked whether CUC will award the $120 million contract to Enron, which topped the second phase of independent review, the source said it has not yet been decided by the board. “Everything is not clear at this stage,” he said.

Independent experts from Burns & McDonnell last month revealed findings of its months-long evaluation of various bids on the project that countered an earlier decision by the board to contract Marubeni-Sithe to build and operate the plant.

But CUC withheld its selection of the final contractor for the next three months pending further review of the report made by the Kansas City-based engineering firm as well as an assessment on the need for the project with such a magnitude on the island.

Enron, the joint venture of Saipan Power Partners and HEI Power Corporation and the consortium of Alsons, Tomen, Singapore Power and Tan Holdings Corp. edged out Japan’s Marubeni Corp. and its U.S. partner Sithe, Energies, Inc. based on the scores tallied by the experts hired by CUC early this year.

The government-owned utility corporation is under pressure to expedite resolution of the disputes stalling the project touted to be the largest deal ever in CNMI’s history.

The plant — to be constructed through build-operate-transfer scheme under a 25-year agreement — was designed two years ago to meet power demand by the end of this decade.

The present economic crisis, however, has prompted CUC to review the project in the face of huge financial liability to both the government and the consumers.