Petition No 768 of 2011 BEFORE THE UTTAR PRADESH ELECTRICITY REGULATORY COMMISSION LUCKNOW Date of Order : 04.11.2011 IN THE MATTER OF: Approval of determined transfer price of fuel and revised Request For Proposal (RFP) timelines for procurement of 2 x 660 MW power from Jawaharpur Thermal Power Project under Case-2 Standard Bidding Guidelines (SBG) of Govt. of India (GoI). Jawaharpur Vidyut Utpadan Nigam Limited (JVUNL), 3rd Floor, Shakti Bhawan Extension, 14, Ashok Marg, Lucknow ---------------Petitioner The following were present: 1. Sri V. K. Verma, CE (Projects), JVUNL 2. Sri Prashant Mehrotra, EE, UPPCL 3. Sri Deepak Raizada, AE, UPPCL Order (Date of Hearing 04.11.2011) 1. The bid process for procurement of 1320 MW (2 x 660 MW) power under Case-2 Standard Bidding Guidelines (SBG) of Govt. of India (GoI) from Jawaharpur Thermal Power Project, Etah has been initiated by the Petitioner. The Commission had allowed initiation of bid process vide order dated 21.5.2010 in petition no 674 of 2010. The Commission had also approved tentative transfer price of fuel as Rs. 1975/ ton subject to its being revised to the determined transfer price of fuel which was to be intimated to the Commission atleast 30 Page 1 of 5
days before Request For Proposal (RFP) bid submission date. The RFP documents for the project were approved by the Commission vide order dated 7.4.2011 under petition no. 729 of 2011. The timelines approved by the Commission was as below: S.N Event Deadline 1. Issuance of RFP T 0 2. Bid clarification, conferences etc. T 0 + 10 3. Final clarification and revision of RFP T 0 + 25 4. RFP bid submission T 0 + 55 5. Evaluation of bids and issue of Letter of Intent (LoI) T 0 + 75 6. PPA becomes effective: Signing of Agreements: i) Power purchase agreement, escrow agreement, hypothecation agreement and any other agreement as applicable (prior to last date of submission of the RFP bids) T 0 + 40 ii) Signing of share purchase agreement and transfer of SPV T 0 +135 2. The Petitioner has submitted determined the transfer price of coal as Rs. 2328/ton for the approval of the Commission. The coal has to be arranged from the Chendipadda coal block which has been jointly allocated to UPRVUNL with CMDC and MAHAGENCO to provide washed coal as per the allotment. However, they had earlier said that they would prefer if the coal linkage is allotted to them. 3. The Petitioner had previously intimated that there were seventeen (17) bidders who have qualified the RFQ stage. 4. The updated status report on key pre-project development activities has been submitted by the Petitioner as below: a. Water: The principal approval of GoUP for drawl of 53 cusec of water from Lower Ganga Canal in available. b. Fuel Arrangements: The FSA shall be signed between JVUNL & UPRVUNL as part of RFP documents for supply of coal from Chendipadda coal block. Page 2 of 5
c. Environmental Clearance: The Terms of Reference by MOEF was issued on 11 th March, 2010. The public hearing by UPPCB was held on 11 th March, 2011. The three seasons study is available and final submission of MOEF for clearance is underway. d. Land: Section 6 Notification has been issued on 15 th Dec. 2010. Further, about 13 hectares Gram Sabha land has also been acquired on 31 st March, 2011. About 60% of land affected persons have taken compensation. 5. The Petitioner has further submitted that subsequent to the issuance of RFP documents there has been a delay in finalization of fuel related issues causing them to approach the Commission for the approval of revised timelines. The sequence of events have been cited as below: a. As per decision taken by Energy Task Force and Government of U.P. the coal for 2 x 660 MW Jawaharpur Thermal Power Project (Etah) being developed by M/s Jawaharpur Vidyut Utpadan Nigam Ltd. (a subsidiary of U.P. Power Corporation Ltd.) is to be supplied from Chendipada and Chendipada II coal Block against share of UPRVUNL allotted to UCM Coal Company. b. M/s UCM Coal Company was requested to approve the draft tripartite Fuel Supply Agreement to be signed between M/s JVUNL, M/s UCM Coal Company Ltd. and UPRVUNL regarding supply of coal to the above Thermal project. c. M/s UCM Coal Company Ltd. on 18 th October, 2011 have intimate that since no consensus has been reached between the Joint Venture partners of UCMCCL to the effect that UCMCCL shall sign the agreement, the said agreement may be prepared afresh on the basis that the draft Fuel Supply Agreement shall be signed between UPRVUNL and Jawaharpur Vidyut Utpadan Nigam Limited. d. M/s JVUNL revised the FSA accordingly and submitted it to U.P. Rajya Vidyut Utpadan Nigam Ltd. for their approval. Page 3 of 5
e. UPRVUNL on 20.10.2011 has conveyed its consent on the above FSA to be entered between UPRVUNL and JVUNL for supply of coal to 2 x 660 MW Jawaharpur TPP (Etah). f. The Fuel Supply Agreement has been sent on 21 st Oct. 2011 to RFQ qualified bidders who have purchased RFP and has also been posted on the official website of UPPCL, i.e. www.uppcl.org. 6. The revised timelines have been proposed as under: S.N Event Deadlines Earlier Approved Revised 1. Issuance of RFP T 0 T 0 18-4-2011 2. Bid clarification, conferences etc. T 0 + 10 T 0 + 10 28-4-2011 3. Final clarification and revision of RFP T 0 + 25 T 0 + 196 31-10-2011 Date 4. Issuance of pre signed documents incorporating the SPV acquisition price and the comments of the bidders - T 0 + 201 05-11-2011 5. RFP bid submission T 0 + 55 T 0 + 211 15-11-2011 6. Evaluation of bids and issue of Letter of Intent (LoI) T 0 + 75 T 0 + 231 05-12-2011 7. PPA becomes effective: Signing of Agreements: i) Power purchase agreement, escrow agreement, hypothecation agreement and any other agreement as applicable (prior to last date of submission of the RFP bids) T 0 + 40 T 0 + 201 05-11-2011 ii) Signing of share purchase agreement and transfer of SPV T 0 +135 T 0 +272 15-01-2011 4. During the hearing, Sri V. K. Verma, CE (Projects), JVUNL, reiterated the submissions as represented in the subject petition. 5. The Commission categorically showed its concern on two issues. Firstly, whether squeezing of timeline at the RFP submission stage is required and if required then whether the prospective bidders would have adequate time to submit their bids. Sri V. K. Verma, CE (Projects), JVUNL stated that the proposed timelines submitted to the Hon ble Commission for approval have already been Page 4 of 5
communicated to the bidders on 24.10.2011. The same has also been posted on their website. Hence, adequate time has been provided to the prospective bidders to submit their bids. 6. Secondly, the Commission is also concerned about the future coal supply to UPRVUNL as the coal was allotted from Chendipada Coal block to UPRVUNL for future projects. Sri V. K. Verma, CE (Projects), JVUNL clarified that coal allocation from Chendipada Coal block is adequate to meet the requirement for UPRVUNL s Obra C Ext. project as well as JVUNL s project under consideration. 7. In view of above, the Commission approves the determined transfer price of coal as Rs. 2328/ton for the bid process. 8. The Commission also approves the revised timelines proposed by the Petitioner as above. 9. The petition is disposed of. (Meenakshi Singh) (Shree Ram) (Rajesh Awasthi) Member Member Chairman Place : Lucknow Dated: 04.11.11 Page 5 of 5