Rajpura thermal project to decide Lanco's fate today

The fate of the sole bidder for the Rajpura thermal power project will be decided tomorrow. As reported earlier, the Hyderabad-based Lanco Infratech Ltd emerged the sole bidder for the Punjab government’s ambitious 1,200-Mw thermal plant at Rajpura that is likely to entail an investment of Rs 6,500 crore.

According to sources in the state government, the financial bid will open tomorrow and would be evaluated by the ‘bid evaluation committee’ under the supervision of the Punjab State Electricity Regulatory Commission. In case of less than two bidders, there has been a provision of constituting a bid evaluation committee, which consists of three representatives from the state electricity board, one financial expert and two officials from the state government.

Out of the seven companies who had purchased the request-for-proposal (RFP) document for the Rajpura thermal project, only Lanco submitted the bid.

Reliance Power, Tata Power, L&T and Essar were among the 13 players who submitted their request-for-qualification (RFQ) bids in May this year. Of these, 10 players were declared qualified.

According to sources, the exorbitant cost of land in Punjab recently averted a number of investors from setting foot in the state and this power project is no exception.

The Punjab State Electricity Board (PSEB) has set up a special purpose vehicle (SPV), Nabha Power Ltd, as its wholly-owned company to facilitate tie-ups of inputs, linkages and clearances for these projects.

The state government has identified 1,085 acres for the Rajpura plant. The coal-based project would be set up on a build-own-and-operate (BOO) basis.

Nabha Power will undertake preliminary studies and obtain necessary clearances and tie-ups regarding coal, water, land acquisition process, power-selling arrangements with the PSEB and the sole procurer from these projects.

The SPV will also obtain necessary environmental clearances.

The state government does not have many options for power generation as many companies have put their plans on hold in the wake of the global financial meltdown. The state’s paucity of funds has necessitated the participation by leading corporations to bridge the gap between demand and supply of power in Punjab.