Extension of bidding period for CUC privatization declined

The Commonwealth Utilities Corp. has declined a recommendation by its consultant on the power plant privatization project to extend the bidding period until Feb. 15, 2005.

Pamela Mathis, CUC special adviser for corporate communications, said yesterday that the utility firm is sticking with the Jan. 7 deadline for the bidding.

Quoting CUC executive director Lorraine Babauta, Mathis noted that all of the six bidders went through the pre-qualification process. Thus, she said, any issues or concerns that they may have had already been discussed.

“The management believes that there is no need to significantly delay the bidding process,” Mathis said.

The bid period was originally scheduled to end in early December.

Harris Group Inc., the consulting firm hired by CUC to do the scope of work and evaluation of proposals for the privatization project, had recommended extending the bid period until Feb. 14, 2005.

On Nov. 1, Harris Group senior vice president Dennis R. Swann and director Chris L. Thompson said at least four of the six bidders had requested for the extension.

“We have been continually pushing the schedule in an effort to contract with a third party for operation of the generation facilities as soon as possible. Now it looks as if we have provided too short a time frame for the bidders to respond,” Swann and Thompson said.

They also said that the bidders had requested two to three months and beyond as an extension.

“Normally, we would recommend only a four- to six-week extension; however, the time period we are now entering includes Christmas and New Year’s holidays. In many parts of the world, very little work is done in December and early January, therefore we believe a 10-week extension is warranted,” they said.

An extension would guarantee that CUC gets the best pricing from the bidders, they added.

Working on behalf of CUC, Harris Group had put out a request for proposals from independent power producers to modernize, upgrade, operate, and transfer Power Plants 1 and 2.

CUC has four power plants: two in Lower Base, one in Isley Field, which is not operational; and the Puerto Rico power plant, which is being petitioned by local residents to be relocated due to noise and alleged environmental pollution.

The Puerto Rico plant is run by a private group.

CUC’s contract with Harris Group cost $103,000.