Companies

Private power players want projects awarded through competitive bidding

ksenia kondratieva Mumbai | Updated on December 17, 2018

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The Electric Power Transmission Association (EPTA) has written to the Ministry of Power to consider awarding more transmission schemes through competitive bidding route, instead of awarding it to state utility on cost-plus basis.

The industry association said it is possible to reduce time required for bidding.

This comes after the National Committee on Transmission (NCT), in its second meeting held on December 4, recommended awarding transmission schemes worth over ₹8,000 crore, most of them for evacuation of renewable power from renewable projects in Gujarat, Rajasthan and the southern States.

In the letter dated December 14, EPTA said 70 per cent of the transmission schemes considered at the NCT meeting has been recommended to be developed through tariff-based competitive bidding route (TBCB), which is “heartening” to private players. However, certain works, for example, the transmission system for evacuating power from Rajasthan SEZ (Part-A), were still recommended to be tendered via the regulated tariff mechanism (RTM) route.

Private transmission companies argue that if done through TBCB, the bidding process could be completed faster.

Reduced timeline

“We strongly reiterate that the bidding timeline of five months for TBCB projects can easily be crashed to about 70 days (approximately 2.5 months) by following a single-stage, two-envelope process that is already being practised for selection of RE developers by SECI, and also has been notified by Ministry of Power under the Gazette Notification dated April 17, 2006,” the letter said.

“We strongly urge you to kindly consider our recommendations on tender timelines in the upcoming ECT deliberations so that the bidding process could be considerably streamlined to award transmission schemes faster through TBCB process,” it added.

It has also asked the Ministry to look into the issue of awarding the augmentation works at existing or under-construction ISTS sub-stations under TBCB route instead of RTM route.

Against postponement

The private transmission companies have argued that the government should not postpone the awarding of transmission projects worth over ₹5,500 crore, designed for evacuation of renewable energy from newly created solar and wind parks, as developing of evacuation infrastructure should be done slightly in advance to the development of the renewable projects, in order to commission both simultaneously.

According to the minutes of meeting of the NCT meeting reviewed by BusinessLine, NCT has decided to defer development of several transmission projects, mainly in Tamil Nadu, Karnataka and Andhra Pradesh as well as some schemes in Rajasthan and Maharashtra, due to lack of connectivity application from renewable generators.

According to EPTA, the postponement of tenders for these projects could potentially create “an avoidable urgency situation” defeating the very purpose of planning these schemes.

This is the fourth time that EPTA has written to the government in the past few months, as the private players continue arguing for better level-playing field in the industry dominated by state-owned PowerGrid as the largest recipient of transmission work awards on a cost- plus basis.

Published on December 17, 2018

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