Protests vs. Enron junked • CUC decision paves way for negotiations on details of 80MW project with power giant

The Commonwealth Utilities Corporation has thrown out three formal protests against its decision to award Saipan’s 80-megawatt power plant to Enron on grounds of lack of merit and public’s interest to move ahead with the project.

CUC Executive Director Timothy P. Villagomez signed the response to the protests brought by the consortium of Alsons, Tomen, Singapore Power and Tan Holdings; Saipan Power Partners and Telesource CNMI, Inc.

Pamela Mathis, CUC information officer, said negotiations with Enron on a final agreement for the estimated $120 million project will continue.

Board Chair Jesus T. Guerrero is expected to instruct CUC’s special legal counsels hired for the contract negotiations during talks with the Houston-based conglomerate, she said.

It is now up to each of the protesters to plan their next course of action, according to a statement released yesterday by Ms. Mathis.
The board is scheduled to meet tomorrow where the status of the protests is one of its agenda for discussion.

Representatives from the Tomen consortium, SPP and Telesource could not be reached for comment on the government-owned utility firm’s decision to reject their complaints.

But based on local procurement regulations, appeals can be filed with the Office of Public Auditor — a move that many firms competing for the much-delayed power project, including Enron, have done for the past three years.

Based on CUC’s almost similar rulings, the bases for the protests were without merit, untimely as well as beyond the authority of the corporation to entertain.

The Tomen consortium, SPP and Telesource had opposed the awarding of the contract last May, citing unconstitutionality of Public Law 12-1 which formed the basis of the board’s decision to choose Enron over other bidders.

Enron garnered the highest scores in the evaluation conducted by CUC’s power consultants from Burns & McDonnell. Tomen and SPP, which closely followed, claimed they were in “statistical deadheat” and should be given an opportunity for a final round of bidding.

Telesource, on the other hand, argued that since the scope of the project was changed when the law allowed phasing in of a 60-MW plant, a new request for proposal should be issued to include potential contractors.

The power company, which operates the new power plant on Tinian, never submitted a proposal when the project began in 1997 — a fact that was highlighted by CUC in rejecting its protest.

CUC also upheld constitutionality of PL 12-1 since it has never been contested in court which is the proper venue to raise such question.

On Tomen’s contention that the Burns & McDonnell’s report was flawed, the utility firm maintained that complaint should have been lodged in October 1999 when it first came out. It also defended the power consultants’ findings.

CUC likewise thumbed down SPP’s demand for reimbursement on the costs it incurred for preparing its bid, noting that it is not an appropriate remedy and a violation of its procurement laws and PL 12-1.

“There is no legal basis for the request that CUC selects a privileged three to compete for the contract, so that two of the losing offerors can, to use an old expression, ‘get another bite at the apple’,” it said.