PowerMin bans Ernst & Young due to evaluation errors

The Power Ministry has banned international consulting firm Ernst & Young (E&Y) from taking up any further assignments in the sector after anomalies in the evaluation of bids for the Sasan project were highlighted in a report by power sector expert P S Bami.

"We issued a show-cause notice to E&Y on their consultancy work on the Sasan project based on Bami Committee Report... It was almost two months back... It has nothing to do with the CAG report on the matter," a Power Ministry official said.

State-run Power Finance Corporation has already banned the global consulting firm after its internal committee found some discrepancies at the time of handing over the Sasan UMPP to the successful bidder.

The report of the committee led by P S Bami, an ex-NTPC Chairman and Managing Director and a sectoral expert, had raised questions over the evaluation of bids for the Sasan ultra-mega power project in Madhya Pradesh, which is being executed by Reliance Power.

The Sasan UMPP was the first such ultra-mega power project, for which bids were called in the year 2007. The project was awarded to Reliance Power after the company quoted the lowest tariff of Rs 1.17 per unit for electricity produced from the project.