Solving Side Effects of 'Excessive Competition' Due to Price-Centered Evaluation
Pilot Project Starting with Seobu Power... Gradual Expansion Planned
Asia Economy DB/Photo unrelated to the article.
[Asia Economy Reporter Kim Bo-kyung] The Ministry of Oceans and Fisheries and the Ministry of Trade, Industry and Energy announced on the 31st that the 'Comprehensive Evaluation Bidding System Pilot Project for the Maritime Transport Sector' will be sequentially implemented at five power generation companies, starting with Korea Western Power.
The comprehensive evaluation bidding system is a system that selects contractors by comprehensively evaluating not only price but also technical skills and the fulfillment of corporate social responsibility. It was first introduced in 2016 for construction projects worth more than 30 billion KRW commissioned by the government or public institutions, and last year, its application was expanded to construction technology services above a certain scale.
Until now, power generation public enterprises have selected maritime transport operators mainly based on price when importing thermal coal for power generation, awarding contracts to the lowest bidders. This has led to a vicious cycle of dumping orders due to excessive competition among shipping companies, distorting market order and causing problems in the stable transportation of bulk cargo.
Accordingly, the Ministry of Oceans and Fisheries judged that it is necessary to evaluate the transport performance capability of operators in the selection process of maritime transport operators, and selected the introduction of the comprehensive evaluation bidding system for maritime transport as a national agenda, promoting it step by step.
Through this pilot project, power generation public enterprises will move away from the existing price-centered evaluation and select successful bidders by comprehensively evaluating the expertise and service performance capability of maritime transport operators along with price.
In addition, evaluation items will include whether social responsibilities such as employment and violations of unfair employment practices are fulfilled, as well as compliance with fair trade order, including bid rigging, contract execution delays, and violations of personnel and vessel deployment plans.
Korea Western Power will implement the pilot project of the comprehensive evaluation bidding system in the maritime transport sector for the first time through a spot charter bidding for thermal coal transport on two routes: Russia~Taean and Australia~Taean on the 31st. The remaining four power generation companies?Namdong, Nambu, Dongseo, and Jungbu Power?plan to promote the pilot project within this year.
Kim Jun-seok, Director of the Shipping and Logistics Bureau at the Ministry of Oceans and Fisheries, said, "Through this pilot project, shipping companies will strengthen their professional transport capabilities, and power generation companies will secure a stable supply of raw materials. We will continue to make efforts to establish a culture of win-win cooperation between power generation companies and shipping companies."
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