A no loss proposition has finally been approved by the government for the state-owned equipment manufacturer?Bhel Ltd. The government has cleared a proposal wherein Bhel and its partner Alstom Power will participate in the bulk tendering by NTPC Ltd for as many as seven units of 660 mw supercritical sets and another six units of 800 mw sets by submitting a competitive bid.

That does not say it all. The catch is that if Bhel is the lowest bidder it will orders for all units and even if Bhel is not the lowest, it will still get assured orders for three units of 660 mw sets and two for 800 mw units by matching the lowest bid.

According to a recent memorandum issued by the power ministry, ?NTPC may go in for bulk tendering of seven units 660 mw each with the clear understanding that the lowest bidder will get order for four units and Bhel will also participate and give a competitive bid. If Bhel is not the lowest, they will get orders for three units at the price of L-1.?

Alongside, NTPC has been asked to work on four units of 800 mw each at Darlipalli, Orissa and Damodar Valley Corporation (DVC) on two units of 800 mw each at Kodarma in Jharkhand so that bids for six 800 mw units can be issued subsequent to the international tender for 660 mw sets.

It has again been clarified by the power ministry that when this tender is issued, the lowest bidder will get four units and if Bhel is not the lowest, it will get two units.

The entire bidding for these supercritical units will be through international competitive bidding (ICB) and stipulate that the winners of the tender would have to set up manufacturing facilities in India with a phased manufacturing programme. If the winning bidder already has manufacturing facilities in the country, then these will be appropriately augmented.

In order to further maximise orders for Bhel, NTPC has been asked to finalise its negotiations with Bhel for turbine generators for two units of 660 mw each of Barh-II project. Bhel has been simultaneously working on their joint venture with Tamil Nadu Electricity Board (TNEB) for Ugangudi (2 units of 800 mw each) project and pursue their bids with Reliance Power for Krishnapatnam in Andhra Pradesh for two units of 800 mw each.

The Central Electricity Authority (CEA) has been asked to further explore the possibility with the state governments like Maharashtra and Gujarat, who may be interested in setting up 660 and 800 mw units. NTPC will also pursue with them the possibility of setting up units through joint venture.