Power Sector News for the third week of June 2010

Special Story

New Power Projects sees rise in new alliances & JVs in power equipment business.

Just after getting disqualified from bidding for NTPC’s Rs.9,000 – Rs.11,0000 crore super critical boiler contract, L & T Power, a 100 % subsidiary of L & T has decided to restructure its joint venture with Mitsubishi, to re-bid for the contract.

A couple of months back, NTPC floated tenders for supplying super critical boilers for 9 of its own projects and two of Damodar Valley Corp’s upcoming power projects. L & T Power, which had bid for the project was disqualified for ‘technical reasons’. The ‘technical reasons’ being that the company lacked experience and expertise to supply supercritical boilers and lacked equity partnerships in manufacturing these. It may be noted that the company’s existing joint ventures, L&T MHI Boilers Pvt Ltd and L&T-MHI Turbine Generators Pvt Ltd — are between L&T and MHI, and not between L&T Power and MHI. Hence, the company is planning to transfer the equity of L&T in their joint ventures (JVs) with Mitsubishi Heavy Industries (MHI) into L&T Power through a book transfer, and re bid for the project, provided , the clauses for the re-tender remain the same.

The delay of three months might see,few other Power Plant JVs like BGR-Hitachi and Ansaldo Caldaie Boilers coming into the fray. Ansaldo Caldaie Boilers, a JV between Italian company Ansaldo—which is 50 per cent owned by Gammon India—and GB Engineering at Trichy, is in the initial stages of setting up the plant.

The other JV likely to bid is between Pune-based Thermax and Babcock & Wilcox , US which has reportedly acquired land for setting up the unit for making boilkers.

One can also expect, Bharat Forge, which is setting up a JV with Alstom of France at Mundra in Gujarat and Toshiba JSW Turbine and Generator Pvt Ltd, a JV between Toshiba Corporation and Sajjan Jindal’s JSW Group, with facilities near Chennai may also be interested in bidding for the project.

Other Stories :

India to set up National Mission for Enhanced Energy Efficiency.

Union Cabinet, on 24th June, gave in principle approval for setting up National Mission for Enhanced Energy Efficiency (NMEEE), the object of which is to foster innovative and sustainable business models to the energy efficiency sector. The NMEEE is one of the eight national missions under the National Action Plan on Climate Change. The framework has four major initiatives in promoting energy efficiency measure. It includes

1. Perform Achieve and Trade Scheme (PAT), a market based mechanism to enhance cost effectiveness of improvements in energy efficiency in large industries.
2. Market Transformation for Energy Efficiency (MTEE), which includes accelerating the shift to energy efficient appliances in designated sectors through innovative measures.
3. Energy Efficiency Financing Platform (EEFP), which allows for the creation of mechanisms that would help finance demand side management programmes in all sectors by capturing future energy savings.
4. Framework for Energy Efficient Economic Development (FEEED), to develop two fiscal instruments to promote energy efficiency – the Partial Risk Guarantee Fund (PRGF) and Venture Capital Fund for Energy Efficiency (VCFEE).

THDC India signs MoU with Bhutan for Bunakha Hydro Electric Project (HEP)

Tehri Hydro Development Corporation ( THDC India ) has signed an MoU with energy department, Royal Government of Bhutan for updating of ‘Detailed Project Report’ (DPR) of 180 MW Bunakha Hydro Electric Project in Bhutan. The MoU was signed on 24th oh June. In addition, THDC has also been assigned the responsibility of updating of DPR of Sankosh Multipurpose Project (4060 MW) in Bhutan

NTPC’s Dadri Power Project – Status Update.

Minister of State for Power , on 23rd of June visited the NTPC”s National Capital Thermal Power Project [NCTPP],Dadri power station and reviewed the progress. It may be noted that NTPC is impleting the Stage-II programme which comprises 2 coal based units of 490 MW are expected in 2010, to meet the power requirement of Commonwealth games scheduled in New Delhi in October 2010. The commercial operation of first 490 MW unit has already been undertaken with effect from 31-January 2010. Also work for second unit of 490MW is under full swing. The station’s capacity allocation is mainly concentrated in northern region of India. Spread over 2,465 acres, the station is situated on the Dadri -Dhaulana road [10 kms. off Dadri G.T. road, and 12 kms. off the National Highway # 24] .

HCC bags construction contract for 100 MW Sainj Hydroelectric project.

Hindustan Construction has bagged the civil works contract worth Rs 431 crore for 100 MW Sainj project on 25th of June. HCC would be responsible for Planning, Design & Engineering and execution of Civil & Infrastructure Works; Manufacturing, Fabrication, Assembling, Testing, Inspection, Transportation, Erection, Supervision and Commissioning of Hydro Mechanical equipment.

The other parties which had bid for the project include Larsen & Toubro, Patel Engineering and Gammon in a joint venture with Marti of Switzerland.

Hyundai Engg and L & T consortium to build GVK’s 800 MW Gauatmi Power CCPP.

GVK Power & Infra has entrusted the work of building its 800-MW Gautami combined cycle power plant at Samalkot, in Kakinada to consortium of South Korea’s Hyundai Engineering and Larsen & Toubro. The equipment will be supplied by Siemens. The project is expected to be complete in the next three years

Haldia Energy to resize power project.

Haldia Energy, an SPV floated by CESC is planning to resize its power project at Haldia in West Bengal to 540 mw from the earlier planned 600 mw. According to the company, Final size will be decided and selected based on the outcome of international competitive bidding and after cost benefit analysis.

Power Bytes – News in a line.

• MP Chini Mills plans to increase capacity of the existing co-generation power plant from 6 MW to 22 MW.
• Environment ministry rejects Jindal Power ‘s a 2,400 MW power plant in Chhattisgarh, for non-compliance.
• The upcoming Chabra extension power plant (1,320mw) and the Kalisindh power unit (1,200mw) projects in Rajasthan obtains long term coal linkage.
• Petronet LNG is likely to go in for a rights issue next year to fund its 1,200-MW power plant near its LNG terminal at Dahej, Gujarat.

Previous Issues :
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1. Power Sector Updates EIM Weekly Newsletter June II
2. Power Sector Updates EIM Weekly Newsletter June I
3. Petroleum Sector Updates EIM Weekly Newsletter June I
4. Jawaharlal Nehru National Solar Mission – Updates
5. Private Sector Participation in Nuclear Power Sector
6. List Of New Power Projects for which Industrial Licenses had been issued in the month of June 2010