As discussions have been hitting breaking point on the proposed revisions, the bidders in the scheduled divestment of the 246-megawatt Angat hydropower plant will likely be offered the old or existing water protocol as the basis for the operation and maintenance (O&M) agreement that the winning bidder will have to sign up with asset seller Power Sector Assets and Liabilities Management Corporation.

“There are a lot of issues that have not been settled yet with the different government agencies involved, so if we cannot come up with a revised water protocol, we will have to revert to the old one,” acting Justice Secretary and concurrent Solicitor General Alberto Agra disclosed in an exclusive interview.

The Office of the Solicitor General (OSG) was the sanctioned entity to draft and finalize the water protocol based on the inputs of agencies involved, such as the Metropolitan Waterworks and Sewerage System, National Power Corporation, National Irrigation Administration, National Water Resources Board and the local government units, among others.

Of the proposed modifications, it was noted that setting a revised rule curve has been among the contentious concerns; while the rest are issues raised by the provincial government of Bulacan, the facility’s host community; and the MWSS concessionaires, Manila Water Company and Maynilad Water Services Inc.

According to the interested bidders, it will not matter much if there is a new protocol or the old one shall be enforced, as long as the parameters are cleared prior to the scheduled April 28 bid submissions for the asset.

“The PSALM Board will meet by the end of the month to decide on next steps. The final form of the water protocol will be discussed,” Agra said. Of the plant’s installed capacity, only 218-MW will be offered for privatization because the two auxiliary units of MWSS with 28-MW aggregate capacity shall be retained under government ownership.

Several big-ticket investors have been hinted joining the auction – the likes of the Ayala-Metro Pacific joint venture; Aboitiz group, First Gen Hydro of the Lopez group, American firm AES Corporation; and Trans-Asia Oil and Energy Development Corporation, among others.

The privatization of the Angat facility, with its reservoir being the main source of water supply for Metro Manila, has been drawing resistance from the concessionaires of the MWSS; as well as some NPC employees and advocacy groups.

Agra noted though that the facility’s privatization has to be carried out, because “it is explicitly stated under EPIRA (Electric Power Industry Reform Act) that Angat has to be privatized.”

He added “if there are quarters opposing the plant’s privatization, then the law has to be amended first. But as the current provision of the EPIRA stays, then the divestment of the plant to private sector hands has to be done.”

Regardless of what water protocol be offered then to investors, Agra indicated that priority water usage is still for drinking and domestic demand, followed by municipal water use; then irrigation and power generation remains last in the order. At normal rainfall, Angat’s operating level was reported to be at average 20 percent, hence, the bidders may factor that in to their offers.