960 MW hydro power project in Himachal fails to find takers.

The 960 MW Jangi-Thopan-Powari hydro power project in Himachal Pradesh has once again failed to find a suitor, compelling the State Government to again extend the last date for bid submission. The reason, cited by the players in the sector is the high premium being sought by the State Government.

The project has failed to find takers and the deadline for bid submission has been regularly extended since November 5, 2014.

'We were supposed to open the bids on March 16. But there was only one bidder. We have postponed the date. This is being done to ensure there is competition,' S P Gupta, Chief Energy, Directorate of Energy, Government of Himachal Pradesh told BusinesssLine.

While Adani Power, Tata Power, Reliance Power, JSW Energy, Flex Industries and NBCC had bought tender documents, only Flex Industries had submitted a bid. Flex had also withdrawn its bid at the last minute.

Gupta added that the new date will be announced soon but there are no changes being made to the original tender documents.

Bidders for the project were required to go over and above the minimum Rs. 35 lakh/MW and were mandated to provide 12 per cent free power for the first 12 years, 18 per cent power for the next 18 years and 30 per cent for the balance 10 years of the project’s operations.

The minimum upfront premium for project was increased to Rs. 35 lakh/MW from Rs. 10 lakh/MW. 'The State Government was expecting that bidders would quote huge premium for seeking the right to develop the project after a 270 MW hydro power project went to Brakel Corporation of Netherlands for Rs. 36 lakh/MW,' an industry official said.

Reliance Infrastructure had challenged the award and subsequently the State Government awarded the project to JSW Energy.

After the award to Brakel was cancelled, the State Government forfeited the amount put up by the Dutch company and levied a Rs. 2,500 crore penalty.

'Failure of current bid process for the 960 MW Jangi-Thopan-Powari would further delay the implementation of project; adversely affecting the revenue to the cash starved State Government,' another industry official added.


HBL