Bidding Pace Quickens for India’s ‘Mega’ Projects

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Researched by Industrial Info Resources (Sugar Land, Texas)--India’s drive to add 100,000 megawatts (MW) to the power grid by 2012 is precipitating alliance between equipment manufacturers, power utilities, and local and international companies.

Three foreign companies and six local companies are bidding the $4 billion Krishnapatnam 4,000-MW “mega” project. Japan’s Sumitomo Corporation, China Light and Power (CLP) and Israel Electric Company (IEC) have submitted bids, as well as local companies and utilities Tata Power, Reliance Energy, Larsen and Toubro, Essar Power, National Thermal Power and Sterlite Industries. CLP and IEC have joined with local partners for the project. Bidding will open October 24, 2007, and the contract to build and operate the power plant could be awarded as early as November

A senior official of Andhra Pradesh Power Generation Corporation said that criteria for deciding the winner included the price at which the developer will sell the electricity generated by the project. India’s per-capita power consumption is among the lowest in the world. The population in many of the country’s 650,000 villages has no access to electricity while many middle class urban houses and companies rely on diesel-fed generators, the Economic Times reported.

Schneider Electric CEO Jean-Pascal Tricoire said that India has one of the weakest electricity infrastructures in the world and that at the same time has high-tech industries for which power cuts are intolerable. “If a power cut stops a lift from working in one of the many prestigious buildings you see now being built in India, then that building loses its value. A one-hour power cut in a stock exchange costs millions of dollars,” he said.

Bidding for another “mega” project, the 4,000-MW project at Tilaiya in Jharkhand, will be in two stages: request for qualification and request for proposal. Companies can procure request-for-qualification documents until November 5, 2007, and then submit these preliminary bidding papers by November 12. Jharkhand Integrated Power Limited, a wholly owned subsidiary of the state’s Power Finance Corporation, has invited proposals to establish the project on a build, own, operate basis.

Two ultra mega power projects have already been awarded. Tata Power will build the Mundra project in Gujurat and Reliance Power the Sasan project in Madyha Pradesh.

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