Power ministry to resume bidding process for UMPPs

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New Delhi | Published: December 23, 2014 1:06:54 AM

The power ministry is all set to revive the bidding process for ultra mega power plants planned in Odisha and Tamil Nadu...

The power ministry is all set to revive the bidding process for ultra mega power plants planned in Odisha and Tamil Nadu, after having faced a delay of nearly a year amid opposition from some independent power producers who sought changes in bidding norms.

The first stage of bidding for two UMPPs had concluded last year but the financial bids stage of the process has been hanging fire due to reasons ranging from delay in environmental clearance and misgivings regarding the bidding norms. “Power Finance Corporation (PFC) will soon be asked to continue with the process of bidding and invite final bids for the Odisha and Tamil Nadu projects,” a government official said.

PFC is the nodal agency for UMPPs — coal-based thermal power projects that have 4,000 megawatt generation capacity.
PFC will invite qualified bidders for the final round soon. It’s the prerogative of those who qualified in the earlier rounds to participate. No company has written to PFC seeking withdrawal from the race, the official added.

In October, Adani Power, Jindal Power and Sterlite Energy had pulled out of the bidding process for a UMPP proposed to be set up at Bhedabahal in Odisha. GMR Energy had pulled out of a planned UMPP at Cheyyur in Tamil Nadu. The companies had cited concerns over bidding norms for the UMPPs, particularly the design-build-finance-operate-transfer (DBFOT) model where lenders’ exposure to the project is not fully secured.

Adani, Jindal Power and Sterlite had purchased the request for proposal documents for the Bhedabahal UMPP, and GMR for the Cheyyur plant, after making the cut for RFQ round. State-owned NTPC now remains the only player in fray after withdrawal of these firms.

The Odisha UMPP is a pit-head power project. Based on domestic coal to be sourced from allocated captive coal blocks, it is expected to cost around Rs 25,000 crore. The Cheyyur UMPP is a coastal power project, based on imported coal, with an expected investment of about Rs 24,200 crore.

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