At Hong Lim Park, one of the investor told me. Hyflux should take all of the blame. They quoted the price of water too low.
He said that a recent international contract quoted a price of US$0.80 per cu meter of desalinated water. That is $1.08. Why did Hyflux quote only $0.35?
I checked Google and found this article. It mentioned that Hyflux quoted $0.35, the next higher tender quoted $0.53 and other tenderers quoted $1.00 per cu meter.
I found this article when searching for the cost of desalinated water.
https://en.wikipedia.org/wiki/Desalination
Quote:
Economics
Costs of desalinating sea water (infrastructure, energy, and maintenance) are generally higher than fresh water from rivers or groundwater, water recycling, and water conservation, but alternatives are not always available. Desalination costs in 2013 ranged from US$0.45 to $1.00/cubic metre. More than half of the cost comes directly from energy cost, and since energy prices are very volatile, actual costs can vary substantially.
Unquote:
So, the figure of US $0.80 mentioned is within the range.
It does appear that Hyflux might have under-quoted the price of water from the Tuaspring plant.
However, there was an article that mentioned that Hyflux was able to improve the design to reduce the energy requirement to produce the desalinated water.
Nevertheless, it is probably that some of the losses suffered from Hyflux probably come from this underpricing of the water.
Tuaspring capacity is 318,500 cu meter per day (70 million gallons). At the price of $0.35 per cu meter, the total value is $40 million a year.
If their price is underquoted, and the actual cost is 50% higher (i.e. $0.52 per cu meter), their loss would be $20 million a year.
Still, the larger portion of their loss came from the power plant.
https://tklcloud.com/Feedback/feedback2.aspx?id=1283
He said that a recent international contract quoted a price of US$0.80 per cu meter of desalinated water. That is $1.08. Why did Hyflux quote only $0.35?
I checked Google and found this article. It mentioned that Hyflux quoted $0.35, the next higher tender quoted $0.53 and other tenderers quoted $1.00 per cu meter.
I found this article when searching for the cost of desalinated water.
https://en.wikipedia.org/wiki/Desalination
Quote:
Economics
Costs of desalinating sea water (infrastructure, energy, and maintenance) are generally higher than fresh water from rivers or groundwater, water recycling, and water conservation, but alternatives are not always available. Desalination costs in 2013 ranged from US$0.45 to $1.00/cubic metre. More than half of the cost comes directly from energy cost, and since energy prices are very volatile, actual costs can vary substantially.
Unquote:
So, the figure of US $0.80 mentioned is within the range.
It does appear that Hyflux might have under-quoted the price of water from the Tuaspring plant.
However, there was an article that mentioned that Hyflux was able to improve the design to reduce the energy requirement to produce the desalinated water.
Nevertheless, it is probably that some of the losses suffered from Hyflux probably come from this underpricing of the water.
Tuaspring capacity is 318,500 cu meter per day (70 million gallons). At the price of $0.35 per cu meter, the total value is $40 million a year.
If their price is underquoted, and the actual cost is 50% higher (i.e. $0.52 per cu meter), their loss would be $20 million a year.
Still, the larger portion of their loss came from the power plant.
https://tklcloud.com/Feedback/feedback2.aspx?id=1283
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