Power sector investors have raised queries ranging from eligibility criteria to availability of clearances for the two upcoming ultra-mega power projects (UMPPs) in the first pre-application conference held here on Tuesday. Assuaging the concerns, the power ministry informed the corporates of the relaxation granted in the new bidding norms.
"The total capital cost requirement, in order to qualify for setting up the plant, has been brought down to 5 per cent. Also, keeping the economic slowdown in mind, the expenditure incurred by the companies on projects in the past seven years will be counted," said a senior power ministry official on the sidelines of the conference, organised by Power Finance Corporation (PFC), the nodal agency that conducts bidding for UMPPs.
PFC has issued requests for qualification (RFQs) for Odisha and Tamil Nadu UMPPs, whose financial bids will be opened in December and the projects, worth around Rs 25,000 crore each, will be awarded in February next year.
Earlier, the capital cost requirement for UMPPs used to be 10 per cent of the overall project cost. Also, the earlier norms took into account expenditure done by prospective developers over five years. Apart from corporate heads, Tuesday’s meeting was attended by engineering, procurement and construction (EPC) contractors, equipment manufacturers, financial institutions and consultants.
PFC told the investors that in the new UMPPs, fuel risk is not with the developer and coal supply is assured in the Odisha project. Also, land and water clearances are already in place for both the UMPPs. In addition, the investors sought details of norms on eligibility for qualification and sourcing of equipment from indigenous manufacturers.