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Practical steps have been taken to build the power plants. The first step relates to the classification of eligible companies to participate in the tender. However, it is clear that there are many problems facing this step, most notably that the classification process is based on a decree that excluded the transactions of works, processing and installation of power generation centers. Therefore, does the Ministry risk exposing the classification process to challenge or deliberately closing that legal gap before it is too late?
When Minister of Energy Nada Bustani announced the start of acceptance of classification applications for companies wishing to develop projects to establish electricity production plants in accordance with the IPP formula, a set of observations concerning the mechanism of the tender procedure and the directions of the Ministry emerged. One of the questions that has been, and continues to be, concerns the principle of corporate classification. Why did the Ministry resort to classification rather than qualification, as was the case when a tender for a specific transaction was put forward? Why did not you leave the order to the tender book, which automatically determines the specifications of the companies that are entitled to participate, as happened in the tender of Deir Ammar 2?
First, it should be noted that the classification includes, according to Decree No. 3688 of January 25, 1966, adopted by the Ministry, the conditions that must be met in companies, to be listed in the list of contractors who are entitled to participate in the implementation of some transactions related to public works, which Requires special competencies. Often, all ministries and public institutions have classification regulations for contractors, which are subject to many criticisms related to the classification method and mechanisms. Therefore, new mechanisms are currently under consideration, in coordination with the Contractors Union and the Engineers Syndicate. On the other hand, the qualification deals with a specific deal to be offered internationally, the first phase of a tender usually launched for this purpose. Examples of this are the oil tender, which was preceded by the stage of qualifying companies, which are entitled to participate in the tender, and the tender gas stations, which excluded from the submission to all companies that did not succeed in the qualification stage.
There is another difference between the two. The classification is often carried out in the ministry concerned, while the qualification is carried out by the issuing entity. For example, the oil facilities launched the stage of qualification for the gas station tender because it was the tender that was launched, not the Ministry of Energy. Similarly, if the qualification for the tender for the electricity plants were to be adopted, the tenders department, which is the initiator of the tender, would have to carry out the qualification stage. However, since the Ministry considered the classification to be the norm, the process automatically became valid. But is classification really the proper legal way for this kind of deal? To what extent does it become the Ministrys accusation that it is legitimately qualifying companies?
Classification does not qualify
For Energy Minister Nada Bustani, the classification based on Decree 3688 takes into account the highest standards of transparency. It is supervised by international consulting companies, confirming that it is not the first time that companies have been classified to set up power plants. It also notes that the tenders department was coordinated with this matter. However, when asked about its position on the classification process, management sources indicated that it does not give an opinion on a file that is not presented to it.
«Energy adoption of the classification process on the decree does not include electricity work
On the other hand, Gostany agrees with the opinion, which indicates that contractors can not be classified to carry out only one transaction. And announce that the classification announced for it is linked to all tenders for the establishment of plants that the ministry intends to launch in the next phase, and does not concern one plant or one deal.
As for the distribution of companies, the Minister of Energy points out that the governments approach to public-private partnerships imposes division of IPP-related business into different categories. Specifically, the classification distinguishes between developer, O & M, Energy Supply Company, and EPC contractors. The classification terms also distinguish between the main developer and the secondary developer. In the former case, it is assumed that the company has already built a plant, alone or as a major company in a consortium, with a capacity of at least 800 megawatts through BOT, BOOT, DBO or DBOT contracts, while the secondary developer is supposed to have contributed to the establishment A factor of not less than 300 MW.
There is a problem with this division. Table No. 4 attached to Decree No. 3688, which relates to the competencies required for registration in the category of operators of "electrical projects" deals not with all the categories presented according to the classification presented, but refers exclusively to the installation and processing of all generation and conversion plants, Without any reference to operation, maintenance, power supply or design. By extension, this classification does not only include qualified partners in the consortium, but extends to the classification of any company capable of carrying out a similar work category defined in the decree. Which some see as a limit to competition because it is limited to practically a very limited number of alliances, making it easy to control the course of the transaction and impose prices.
"Electricity" is excluded
If the classification process faces many problems, what has finally been revealed can undermine it. The Ministry of Energy has determined that Decree No. 3688/66, on which the classification of companies was based, has completely eliminated the power generation projects under the provisions of Decree No. 14901 of 11/7/1970. The first article clearly states that "the provisions of Decree No. 3688 dated 25/1/1966 and the schedules attached thereto shall be exempted from the provisions of the provisions of Decree No. 3688 of 25/1/1966. . In other words, the decree that sponsors the classification process, which the Ministry has clearly indicated in the conditions to be followed in the classification process (p. 18 of the classification documents published on its website) does not include the transactions of the power plant. This means that all that the DOE is currently doing is subject to appeal, if it does not insist on addressing it, because it has no legal basis.
Bustani: The classification process takes into account the highest standards of transparency
Apart from the distribution of companies and the adoption of the ministry to the decree is irrelevant, one of the interested in the plant tenders, raises two issues called to stop them, the first relates to the Ministrys failure to impose a requirement to provide a certificate of experience proves that the company to create a plant with the capacity of 800 MW, These plants have been executed on the basis of BOT contracts (construction, operation and transfer to the state) which include insurance of the winning company for financing, and the second relates to the non-limitation of the deadline for submitting applications for classification. The source asks if the company has the necessary expertise to build this type of plants, what is the importance of requiring that its expertise be linked to securing the source of funding for these plants? Considering that the condition of this condition contributes to the limitation of competition, as nothing prevents a large company has carried out dozens of laboratories in different parts of the world, without contributing to the financing, while in Lebanon agrees to believe in funding.
Open timeout
"This is not on the table," says Bustani, who explains that the requirement that the developer has implemented BOT contracts is not about funding, but rather that he has experience not only by building the plants, but by operating them and maintaining them. And the operation of the laboratory for 20 years (the period has not yet been decided). Therefore, it is not possible to risk contracting with a company that does not have the experience of managing plants.
As for the observation that the conditions of classification do not specify the deadline for submission of tenders, the Minister of Energy states that this is intentional and relates to increased transparency. Anyone interested in the tender has the right to submit classification documents at any time from the moment the applications are accepted until the last day before the tender is launched. |
