GE responsible for Dabhol cost, time overrun: powermin

Written by Anupama Airy | New Delhi, May 7 | Updated: May 9 2008, 04:42am hrs
The US-based General Electric (GE) has been held responsible for the increase in completion costs and the in-ordinate delays in reviving the Dabhol power project, currently being executed by the Ratnagiri Gas and Power Private Limited (RGPPL).

Says a latest status report by the power ministrys technical wing, the Central Electricity Authority (CEA), prepared for the consideration of the Committee of Secretaries (CoS), Four out of the six gas turbines supplied by GE have failed (one during the Dabhol Power Companys regime and three during RGPPLs period). The failures have resulted in additional financial burden on RGPPL and the completion time for revival of Block-I had to be extended due to these failures. The completion cost for the revival of power blocks have gone up beyond the initial approved cost of Rs 670 crores.

According to CEA, following repeated failures of gas turbines, the actual cost to be incurred by RGPPL for the revival process has gone up. This includes expenses towards the cost towards repair of all the four gas turbine roots. The revised cost, after taking into account the repairs, services and transportation costs to and from GE repair shops in Singapore and UK, is yet to be intimated by RGGPL.

While after repeated failures of gas turbines, GE was asked to do a root cause analysis (RCA) for such failures. However, CEA has informed the power ministry that GE is still to respond to the RCA for such repeated failures of gas turbines as also on the reasons for shortfall in plant capacity (by about 10%) in the capacity of power blocks II and III.

It may be recalled that the revival of power blocks was taken up by RGPPL in 2006 and by the end of April 2006, the power block-II was revived and commissioned. This was followed by the revival of block-III and the complete module was re-commissioned by October 2007. The revival process for Block-I is still in progress and it is expected that half of this module will be commissioned during May 2008.

Giving details on how the cost of repairs at GEs workstations added up to the cost of revival of the project, CEA said that during the revival process, when one of the gas turbine (GT 1B) was opened for condition assessment studies, it was seen that the compressor of the gas turbine was in fully damaged condition. The damage was beyond repair and had to be shipped to GE works, UK for repair at the site. The total cost for repair involved cost of compressor blades, service charges and transportation charges to and from the works.

Then, CEA said that the gas turbines of power block-II had to be sent to GE works, Singapore for repairs. The cost towards repairs and transportation charges added up to the cost of revival. Further in order to keep the power block-II operative, it was necessary to install the spare rotor available with the project in GT 2B. This not only involved studies and assessments by the GE team at the site but also erection and commissioning of the gas turbine.

On the revival of Block-I, CEA has informed the ministry that the gas turbine 1B is expected to be commissioned by May 7, 2008 and steam turbine by May 15, 2008 subject to availability of spare parts. Further, commissioning of gas turbine is subject to receipt of gas turbine rotor under repair at GE works, Singapore and repair of GTG gas turbine generator by BHEL. The expected date for this has been given as middle of May by CEA.

For revival of 2A and 2B, CEA has informed that RGPPL has contracted Aptech Engineering Services Inc of USA for third party association in the RCA of 2A and 2B. Tests in this regard have commenced on April 16, 2008. The GT 2A rotor has been shifted to GE works, Singapore for repair and investigations.

On the 3B rotor damage, while GE had agreed in March 2008 to provide probable causes of run outs of this rotor by April 30, 2008, it is yet to furnish the probable causes in this regard. On the vibration problems in 3A and 3B turbines, GE was asked to furnish the campell diagram for further analysis. The same is still awaited from GE, CEA told the power ministry in its report.

The CEAs report further points out that in order to optimize the cot of operation and spares etc, it has been earlier proposed that RGPPL should come up with a proposal for long term contract for operation and maintenance of the plant. Two options which have been suggested by CEA in this regard includes a long term contractual service agreement with GE to include both services and spares or alternatively a long term spares agreement with GE and a long term service agreement with Bhel.

However, CEA said that RGPPL is yet to respond to these two options. CEA has again advised RGPPL to opt for one of the two options which will give higher confidence level not only to RGPPL but to Maharashtra Electricity Development Corp and the stakeholders for safe and reliable operation of their advanced class gas turbines.

When RGPPL was entrusted with the job of revival of Dabhol plant, an estimate was made with the help of experts from NTPC and under a common term loan agreement (CTLA) executed between RGPPL and the lenders on September, 28, 2005, an amount of Rs 870 crores was agreed as revival charges. However, subsequently at a meeting chaired by the then cabinet secretary on August 21, 2006, the cost of revival was brought down to Rs 670 crores. The failures in the machines occurred during the revival process, the cost of which was not taken into account while formulating the estimates for revival process.