The Hindu Business Line : AES Corp, CLP Power are back; bid for UP project

POWER utilities AES Corporation of US and Hong Kong-based CLP Power International that had packed their bags in the wake of policy bottlenecks in the power sector are back in India.

Both the entities are among the eight that have been short-listed by the Uttar Pradesh Government to develop the 1,000-MW Anpara C thermal power project in the State.

Other short-listed bidders in the fray include Tata Power, the AV Birla group, Essar, Torrent Power, Reliance and the Lanco-Genting combine, an official associated with the bidding process told Business Line.

"The Uttar Pradesh Government has invited request for proposals from the short-listed bidders. We will finalise the documents upon receiving comments from them after which price bids will be invited. The State Government expects to award the project in the first quarter of the next fiscal starting April 2005," he disclosed.

Anpara C is the first power project to be bid out to private sector on the basis of the competitive tariff-based bidding guidelines drafted by the Union Power Ministry, he added.

As per the guidelines, the bidder quoting the lowest tariff for power generated from the plant will be awarded the contract, instead of the earlier cost-plus based bidding process.

Policy changes

While AES Corp had pulled out after facing payment problems in the Ib Valley power project in Orissa, CLP Power had quit the now-abandoned Mangalore Power project in the late 1990s.

The changes that have taken place in the power sector since then has enthused many of these entities to stage a comeback.

"Almost all the independent power producers are expanding. So you can see the confidence level among foreign investors in the power sector is back. Things are looking up," an industry official said.

In fact, policy changes in the power sector has forced CLP Power to jettison efforts to sell its 670 MW power plant in Paguthan in Gujarat which it had acquired from Powergen.

"CLP has changed its mind to sell the Paguthan power plant and is even planning to expand capacity by setting up a second unit not necessarily to sell power in Gujarat but outside the State as well," the official said.

In this regard, CLP Power has already re-negotiated the power purchase agreement with the State Government.

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