Velcan eyeing PPA and tariff negotiation for Aceh hydro project
Thursday, February 25 2016 - 01:53 AM WIB
European hydropower developer Velcan SA and PT Pembangkitan Jawa Bali (PJB) have amended a consortium agreement in view of submitting the project proposal to offtaker state electricity firm PT PLN, and negotiating the tariff of Meureubo 2 Hydropower plant for 30 years.
According to Velcan in its release issued on Tuesday, the original agreement executed in October 2013 established the consortium for the development of the Meureubo 2 Hydropower Project, as well as the distribution of the consortium members? roles and equity stakes. Project technical feasibility studies and various administrative procedures were conducted since then under the consortium agreement.
The consortium was selected as exclusive qualified prospective developer of the project in January 2015. PLN issued the Request For Proposal (RFP) from the consortium for the project in October 2015.
The RFP requires the consortium to present, on an exclusive basis, the project detailed features, costs and financing structure, and to offer a tariff for the power to be supplied through the Power Purchase Agreement proposed by PLN.
The bid submission date was initially scheduled on the 31st of December 2015, but the consortium failed to meet the deadline as it has to take into account the amendment of the consortium and to provide more time to prepare the detailed proposal which must include expressions of interests from lenders, financial institutions, EPC contractors and equipment manufacturers, Velcan said.
The teams of Velcan and PJB are currently working on a daily basis to finish the bid documents for a new expected bid submission date in March 2016. PLN and the consortium will then enter a tariff negotiation phase, should the consortium manage to fulfil all criteria requested by PLN in the RFP, Velcan added.
Velcan leads the consortium of the Meureubo 2 Hydropower Project with a 70 percent stake alongside PJB with a 25 percent stake. PJB is a fully-owned subsidiary of PLN and will be responsible for the operations and maintenance of the power plant.
PT PPC, Velcan?s local partner for this project, owns the remaining 5 percent of the consortium.
The project, which is located in Aceh province, will have capacity of 59 MW.
According to Velcan presentation dated December 2015, the project?s construction is expected to start in the fourth quarter of this year or early next year.
Editing by Reiner Simanjuntak