Letters | Sunday, 21 June 2009

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Delimara bidder was not in ‘pole position’

Reference is being made to MP Evarist Bartolo’s article in MaltaToday of the 14 June.
The allegation that Danish company BWSC was in ‘pole position’ when the pre-tendering process for the new generating plant is completely unfounded.
Enemalta regularly receives presentations from suppliers of generation and distribution equipment and these presentations are welcomed, provided that they occur prior to commencement of tender procedures, as they are a useful source of up to date information on new developments in the industry. This is a normal procedure and in no way goes contrary to the established regulations.
During 2004 and 2005, Enemalta was actively evaluating the possible use of medium sized diesel engines in order to build a small 35MW extension to its power generation facilities. However due to the increase in demand and the need to decommission Marsa Power station, Enemalta as part of its generation plan decided that an extension of at least 100MW to the existing plant was required and a request for information (RFI) was published in September 2005. This request for information received replies from 26 companies of which five companies including four proposing diesel engines requested permission to give presentations, which was granted. Of the 26 companies, there were a number who proposed gas turbine based plants, interconnectors and diesel engines. All respondents to the RFI were given the opportunity to make a formal presentation to Enemalta on their proposals. Most of the companies which actually sent delegations to visit Enemalta were accompanied by local agents or representatives.
The claim that the representative of BWSC obtained in March 2005, technical details of the generating plant which was to be later specified by Enemalta is not even credible as a request for proposals (RFP) was published in November 2006 and an invitation to tender with a detailed specification was only published in August 2007.
The fact that BWSC’s main competitors were Wartsilla and MAN is common knowledge to anyone in the industry as BWSC specializes in the construction of diesel engine plants and the only two European manufacturers of such plants are MAN and Wartsilla and even the Far East manufacturers are licencees of these two companies.
Apart from proposals to give presentations, it is a common occurrence that suppliers invite Enemalta to send engineers to contact or visit other operators of similar plants or the factories where the equipment is manufactured and get first-hand information both on the reliability of such equipment and on the manufacturing and testing processes. Enemalta accepts or otherwise such invitations based on the nature of the equipment and the relevance to Enemalta’s plans for development of its installations. No such invitations are considered let alone accepted once the tendering process commences.
The tender for the new generating plants was open to all suppliers and open to all technologies. Out of the six bidders who responded to the request for proposals, three submitted proposals for gas turbine based plants, and three submitted proposals for diesel engine plants with one bidder initially submitting a proposal for both diesel engines and gas turbines.
Out of the five bidders that replied to the invitation to tender, two submitted bids for diesel engine plants and two for gas turbines is a clear indicator that the specifications were not tendered for any particular type of plant or manufacturer. It should be noted that had any of the participants to the tender, had any suspicion of any such preference they were at all liberty to submit such to the Director of Contracts and request him in terms of the procurement regulations to investigate and if necessary take action to remedy.
Once again it has to be stressed that all the plants offered (ie both the diesel engines and the gas turbines) were fully compliant to the environmental directives of the EU and local legislation, and the fact remains that the plant chosen by Enemalta was selected on criteria which was published in 2006 and 2007 and which were never contested by any of the bidders. The plant conforms fully to the environmental legislation and directives and has the least cost of generation, which will have a positive effect of lowering Enemalta’s operating cost and hence the electricity tariffs.
It is true that reagents will have to be imported and waste will have to be exported in annual quantities of about 10,000 tons, but the quantities involved are insignificant compared to the 650,000 tons of fuel imported by the power stations annually.

Ian Vella
Public Relations
Enemalta

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