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BEFORE THE UTTAR PRADESH ELECTRICITY REGULATORY COMMISSION LUCKNOW
Petition No. 632/2009
IN THE MATTER OF : Approval of Request for Proposal (RFP) & RFP Project documents - Transmission Service Agreement (TSA), Share Purchase Agreement (SPA) & Connection Agreement (CA) for selection of developer to establish “765KV Mainpuri - Bara line with 765KV/400KV AIS at Mainpuri and associated schemes/works (Package-1)” through tariff based competitive bidding process.
AND IN THE MATTER OF : Uttar Pradesh Power Transmission Corporation Ltd., 11th Floor, Shakti Bhawan Extension, 14-Ashok Marg, Lucknow – 226 001 :Petitioner AND Petition No. 633/2009
IN THE MATTER OF : Approval of Request for Proposal (RFP) & RFP Project
documents - Transmission Service Agreement (TSA), Share Purchase Agreement (SPA) & Connection Agreement (CA) for selection of developer to establish “765KV S/C Mainpuri - Hapur & Mainpuri – Greater Noida lines with 765KV/400KV AIS at Hapur & Greater Noida and associated schemes/works (Package-2)” through tariff based competitive bidding process.
AND IN THE MATTER OF : Uttar Pradesh Power Transmission Corporation Ltd., 11th Floor, Shakti Bhawan Extension, 14-Ashok Marg, Lucknow – 226 001 :Petitioner
The following were present :
1. Shri S. K. Agarwal, Director (Finance), UPPTCL 2. Shri E. R. Rizvi, Chief Engineer(Projects), UPPTCL 3. Shri P.K. Gupta, Superintendent Engineer, UPPTCL 4. Shri Vineet Kumar, Executive Engineer, UPPTCL 5. Shri Siddharth Mehta, Crisil Ltd. (UPPTCL’s Consultant ) 6. Shri Amit Goenka, Crisil Ltd. (UPPTCL’s Consultant ) 7. Shri H. Dassani, Isolux Corsan
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8. Shri Lalchand, Isolux Corsan 9. Shri Himanshu Chaudhary, Cobra, S.A. 10. Shri B. Srinivasa Reddy, Cobra, S.A. 11. Shri N. Thirupathi Rao, Cobra, S.A. 12. Shri Vinay Ahuja, Cobra, S.A.
DETAILED ORDER
(Date of hearing 08th June, 2010)
(1) U.P. Power Transmission Corporation Ltd., (UPPTCL) has
been authorized to act as Bid Process Coordinator (BPC) by the
Energy Task Force (ETF) of GoUP and in that capacity it had filed
certain documents, clarifications and point-wise replies of the
bidders’ queries as per the directions of the Commission vide order
dated 25-05-10 and 03-06-10. These documents and clarifications
were broadly based on the issues discussed in the public hearing
held on 18-05-10 and the replies were in response to the queries
raised by both the bidders through written submissions to the BPC in
the matter of RFP & RFP Project Documents. These have been
submitted by BPC in continuation to the modified RFP & RFP Project
Documents submitted earlier in the above referred petitions. All the
above documents are in partial deviation to the Standard Bid
Documents available for selection of Transmission Service Provider
(TSP) to develop the following on Build, Own, Operate & Maintain
and Transfer (BOOT) basis :
(a) “765KV Mainpuri - Bara line with 765KV/400KV AIS at Mainpuri
and associated schemes/works”, called Package-1, which
consists of 765/400 KV lines/LILO and 765/400 or 400/220 or
132 KV substations and
(b) “765KV Mainpuri - Hapur & Mainpuri – Greater Noida lines with
765KV/400KV AIS at Hapur & Greater Noida and associated
schemes/works”, called Package-2, which consists of 765/400 KV
lines/LILO and 765/400 or 400/220 or 132 KV substations.
The deviations in these documents for both the petitions are
similar and common in nature. Two-stage bidding process for tariff
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based competitive bidding under guidelines issued by GOI is being
followed under these petitions.
(2) The RFQ documents in the both the petitions have already
been approved by the Commission vide orders dated 15-10-09 &
20-10-09 following the public hearing held on 07-10-09. The RFP
documents were not taken up during the hearing on 07-10-09 since
the petitioner had not submitted the RFP Project documents by that
time.
(3) During the hearing held on 18-05-10 the Commission directed the
petitioner to submit certain documents and clarifications along with
the point-wise reply to the written submissions of M/s Isolux Corsan
Concesiones, SA and M/s Cobra Instalaciones, SA, the two bidders,
before the next date of hearing in the matter scheduled at 11:00 hrs
on 03-06-10. The Commission also directed the petitioner to present
himself in person during the next hearing on 03-06-10 so that the
vital issues could be discussed thoroughly. The Commission also
observed that the affidavits of Sri A.K. Singh, Chief Engineer,
submitted by BPC during the hearing on 18-05-10 mentioned about
RFP Project Documents only and nothing about RFP documents.
Therefore the petitioner was directed to file revised affidavits
incorporating the necessary corrections. .
(4) During the hearing held on 03-06-10 the Commission
observed that neither the petitioner nor any of their representatives
were present and no reply to the written submissions of the bidders
was submitted by the petitioner. The Commission took a very serious
view over the matter and directed the petitioner to file the point-wise
replies of the written submissions of both the bidders within ten days
of the order dated 03-06-10 with a copy to the bidders and the
bidders to file their rejoinders within seven days thereafter. The
Commission decided that the next hearing in the matter would be
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held after the petitioner files their reply and the bidders file their
rejoinders.
(5) The petitioner submitted the clarifications and other relevant
documents along with their reply vide letter no. 586 dated 03-06-10
in compliance to Commission’s orders dated 25-05-10 and 03-06-10,
and was received in the Commission on 03-06-10 evening after the
Commission had already passed orders on the proceedings held on
03-06-10. Later, the petitioner, vide fax letter dated 04-06-10,
requested the Commission for an early hearing in the matter and
intimated that the reply had also been sent to the bidders.
In view of the request of the petitioner for an early hearing
and with an intention that the comments of the bidders on the reply
of the petitioner could be heard during the next hearing, the
Commission issued notices vide UPERC/Secy/JD(T)/2010/066 dated
04-06-10 and UPERC/Secy/JD(T)/2010/067 dated 04-06-10 to
UPPTCL and to M/s Isolux Corsan Concesiones, SA and M/s Cobra
Instalaciones, SA, the two bidders, for hearing in the matter of RFP
& RFP Project Documents on 08-06-10 at 10:30 hrs. The petitioner
was directed to put the above mentioned petitions along with
relevant RFP & RFP Project documents on its website and also
make hard copies of the same available in its office for inspection of
the concerned persons.
(6) The said documents, clarifications and the replies to bidders’
queries in both the petitions have been submitted by BPC under the
signature of Shri E. R. Rizvi, Chief Engineer (Projects), UPPTCL,
who, along with the above submissions, also filed an affidavit on his
behalf, as a petitioner for the above petitions.
(7) Accordingly in the hearing on 08.06.10, the documents,
clarifications and replies of the bidders’ queries, submitted by
UPPTCL in both the petitions, were considered for discussion.
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Since the deviations are similar in nature, both petitions
have been decided by this common order.
(8) M/s Cobra Instalaciones and M/s Isolux Corsan had submitted
their written comments to BPC earlier and their copies were
submitted to the Commission during the hearing on 18-05-10.
(9) The documents submitted by BPC, as mentioned in
paragraph-5 above, consist of the following :-
(i) Copy of UPPTCL’s letter no 569 dated 31-05-10 sent to
Director (SP&PA), CEA (annexure-1 of written submission),
for technical clearance of the transmission scheme, in
reference to an earlier letter dated 06-06-08 of CEA vide
which it had sent the previous studies to UPPTCL.
(ii) Revised Allocated Project Capacity of the four distribution
companies, DVVNL, MVVNL, PVVNL & PuVVNL (annexure-2
of written submission).
(iii) Point-wise replies of the written submissions of M/s Isolux
Corsan Concesiones, SA and M/s Cobra Instalaciones, SA,
the two bidders, (annexure-3 of written submission).
(iv) Copy of letter no 15/01/2010/Trans dated 07-05-10 of Ministry
of Power (annexure-4 of written submission) vide which they
have made amendments in the Standard Bid Documents of
Request For Proposal (RFP) & Transmission Service
Agreement (TSA) for procurement of Transmission Services
through tariff based competitive bidding. The amendment
basically pertains to enhancement in the term of transmission
services agreement from twenty five (25) years to thirty five
(35) years.
(10) In response to the clarifications sought by the Commission vide
order dated 25-5-10, UPPTCL submitted the following through their
written submission dated 03-06-10 :-
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1. Regarding paragraph 11(a) of the order dated 25-05-10 in
respect to filing of affidavits of Sri A.K. Singh, Chief Engineer,
after due correction, the petitioner explained that w.e.f.
21-04-10 the post of Chief Engineer, Transmission of
UPPTCL has been segregated into two independent posts of
Chief Engineer (Operations) and Chief Engineer (Projects)
who now head the respective departments of Operations and
Projects. Therefore the revised affidavits have been submitted
by Chief Engineer (Projects) as the PPP transmission bidding
comes under the Projects department. However, the
Commission pointed out that the earlier affidavits filed by Shri
A.K. Singh did not mention about RFP documents and
directed the petitioner to make necessary corrections and
submit the same within ten (10) days of this order.
2. Regarding paragraph 11(b) of the order dated 25-05-10 in
respect to technical clearance of CEA and approval of BOD &
ETF for the revised transmission scheme and the clarification
sought by the Commission as to how in absence of any
approval of TWC, BOD or ETF, the changes have been made
in the original transmission scheme, the petitioner mentioned
in their written submission that the transmission scheme had
been revised in view of some technical reasons viz. long
length of LILO, evacuation of power from Parichha power
station, problems of ROW and land acquisition etc.. BPC
further submitted that Load Flow Studies were carried out by
UPPTCL with the above modifications and the revised
transmission proposal was found technically in order.
However, a letter has been sent to director (SP&PA), CEA on
31-05-10 for obtaining the technical clearance of the modified
transmission scheme, as per the directions of the
Commission.
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3. Regarding paragraph 11(c) of the order dated 25-05-10 in
respect to adoption of Swiss Challenge Method (SCM) in the
bidding process; introduced in clause 3.4.1.5 of the RFP
documents, the petitioner was directed to clarify that in the
event of the lowest bidder in the fresh bidding under SCM
process refuses to honour his bid, after original lowest bidder
has not exercised his right of first refusal, and there are other
bidders in the fresh bidding under SCM whose quoted price is
lower than that of original lowest bidder then how can the
original lowest bidder be considered for award of work at their
original higher quoted price. The Commission opined that
SCM mentioned in clause 3.4.1.5 of the modified RFPs is not
acceptable and directed the petitioner to modify the clause
suitably so that the objective of fairness in the bidding process
could be achieved.
The petitioner, in their written submission dated
03-06-10, mentioned that in view of the directions of the
Commission, they have revised the Swiss Challenge Method
as per the following details :-
• If the Govt. does not find the bids competitive then the Govt. of UP may apply Swiss Challenge Method. The lowest original financial bid, received by the BPC would continue to remain valid till the conclusion of Swiss Challenge Method process. The BPC under this process would issue a public notice inviting challenge in the nature of fresh bids with same terms of eligibility under the relevant condition as were applicable under the original bid except the amount of Bid Bond that would be double the amount as per original bidding process. The lowest financial bid received shall be disclosed and a period of 30-45 days would be given for due-diligence and submission of fresh bids. The fresh bids under this process cannot be more than the disclosed lowest original financial bid received. All bidders excluding the original lowest bidder shall be eligible to submit the fresh bid under this process.
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• As per Swiss Challenge Method, the original lowest bidder shall have the right of first refusal by matching the lowest financial bid received in the fresh bidding process under Swiss Challenge Method. In case the right of first refusal is not exercised by the original lowest bidder, the lowest bidder in the fresh bidding process under Swiss Challenge Method shall have the right to award of the contract / assignment. The original lowest bidder would have to exercise the right of first refusal within a period of 15 days from the date of receipt of notice from BPC. In case no fresh bid is received under this process; The Govt. of UP may consider the bid of original lowest bidder even though it was higher than the expected price.
• In case the lowest bidder in fresh bidding under Swiss
Challenge Method process refuses to honour his bid, after the original lowest bidder has not exercised his right of first refusal, the bid bond of the lowest bidder in fresh bidding under Swiss Challenge Method shall be forfeited.
• Subsequently, the bid of the second lowest bidder in
the fresh bidding shall be considered. The original lowest bidder shall again have the right of first refusal by matching the second lowest financial bid received in the fresh bidding process. In case the right of first refusal is not exercised by the original lowest bidder, the second lowest bidder in the fresh bidding process shall have the right to award of the contract/ assignment. In case the second lowest bidder refuses to honour his bid, after the original lowest bidder has not exercised his right of first refusal, the bid bond of the second lowest bidder in fresh bidding process shall be forfeited. This process will be continued till a final bidder is selected from the fresh bidding under the Swiss Challenge Method.
4. Regarding paragraph 11(d) of the order dated 25-05-10 for
‘Allocated Project Capacity’ of each DISCOM. The
Commission sought the clarification on revising the figures of
Allocated Project Capacity of each LTTC and why the existing
state / other generating stations, in which the LTTCs have
shares and whose scheduling is to be coordinated by SLDC,
should not be taken for computation of Allocated Project
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Capacity of LTTCs, as per the provisions contained in the
definitions of ‘Allocated Project Capacity’ and ‘SGS’ of RFPs.
The petitioner mentioned in their written submission
that the Allocated Project Capacity has been re-worked out as
per annexure-2 of the submission. The revised Allocated
Project Capacity, stated by the petitioner, is as follows :-
DISCOM Allocated Project Capacity
Dhakshinanchal (DVVNL) 23%
Madhyanchal (MVVNL) 17%
Paschimanchal (PVVNL) 38%
Poorvanchal (PuVVNL) 22%
The petitioner further clarified that the revised allocated
project capacity of the DISCOMs has been worked out on the
basis of energy allocation to different DISCOMs proposed by
them and approved by the Commission in its Tariff order for
FY 2009-10.
5. Regarding paragraph 11(e) of the order dated 25-05-10 for
modification in RFPs & RFP Project Documents; the petitioner
intimated through their written submission that the definition of
‘Long Term Transmission Customer’ has been amended as
per Standard Bid Document and the date of issuance of RFP
documents has been revised to 9th March, 2010, which was
earlier 10th August, 2009. The petitioner had also incorporated
the details of the transmission lines and substations in the
connection agreement as per annexure-5 of their written
submission. However, the petitioner clarified that clause 1.6 of
RFPs cannot be revised in line with SBD as MOP is not
involved in the whole process. The petitioner further clarified
that the relevant note specified in the clause 2.15.1 is not
applicable to the RFP documents as the proposed
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transmission lines/substations under both the petitions are the
part of intra-state transmission network.
(11) The oral submissions made in the hearing by the UPPTCL and M/s
Isolux Corsan and M/s Cobra, the two bidders, were broadly based
on the recent amendment made by Ministry of Power in Standard
Bid Documents, clarifications sought by the Commission vide its
order dated 25-05-10 and the queries raised by the two bidders.
These submissions are summarized as below.
a) In view of the amendment made in Standard Bid Documents
by Ministry of Power vide letter 15/01/2010/Trans dated 07-05-10
regarding increase in the term of transmission service agreement to
thirty five (35) years, UPPTCL requested the Commission that the
contract years for the transmission licensee mentioned in the RFP &
RFP Project Documents may be allowed to be amended from twenty
five (25) years to thirty five (35) years and accordingly the bidders
are required to quote the transmission charges for a period of thirty
five (35) years commencing from COD.
b) The petitioner submitted that the revised transmission scheme
has been sent to CEA for technical clearance vide letter dated
31-05-10 and its copy has been submitted to the Commission. The
petitioner further stated that the matter of revised transmission
scheme has also been simultaneously moved to BOD of the
transmission company for its approval. However the approval of ETF
for the revised transmission scheme shall be obtained as and when
the strategy for the transmission system is finally approved by the
Commission.
On the clarification sought by the Commission vide order
dated 25-05-10, as to how in absence of any approval of TWC, BOD
or ETF the changes have been made by BPC in the revised
transmission scheme Director (Finance), UPPTCL admitted that the
transmission scheme should not have been changed without
obtaining the approval of Transmission Works Committee (TWC);
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however he clarified that the Planning department of UPPTCL, which
at present looks after the work of Transmission Planning, has expert
officers equipped with the latest software for the purpose of load flow
studies etc. The revised transmission scheme had been sent to the
Planning department first who, after conducting the studies and
finding the revised proposal technically in order, gave their clearance
to the revisions. After obtaining the technical clearance of the
Planning department the proposal was sent to Transmission Works
Committee (TWC) for its approval. Director (Finance) admitted that
although the revised transmission scheme has now been approved
by TWC, this approval should have been sought before filing it in the
Commission. He also assured that the approval of CEA, board of
transmission company and ETF shall be taken for the revised
transmission scheme in due course of time.
c) On the adoption of Swiss challenge method (SCM), Director
(Finance), UPPTCL explained that it has been revised in such a way
that it takes care of the problem pointed out by the Commission in its
order dated 25-05-10 and eliminates the chances of losing an
opportunity of lowest bid in case the bids are not competitive and
SCM is adopted.
M/s Isolux objected to the adoption of SCM and submitted
that after qualifying, the efforts and time put in over a long period of
time and the appreciable cost incurred in studies, survey etc. will go
waste if opportunity is given to another bidder who has the
advantage of knowing the L – 1 bidder’s prices in advance and can
accordingly reduce its prices marginally to secure the contract.
M/s Cobra apprehended that if SCM is adopted the parties
who did not have the qualification earlier when the tenders were
called might qualify at the SCM stage and further suggested that the
problem of non-competitive bids could be resolved by mentioning the
words ‘appropriate measures shall be taken by BPC’ instead of the
words ‘adoption of Swiss Challenge Method’ in RFP documents.
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Director (Finance), UPPTCL, ruled out the suggestion of M/s
Cobra by saying that BPC is legally bound to disclose the bid
process proposed to be adopted. He explained that Swiss Challenge
Method is proposed to be adopted in view of the limited competition
existing on account of only two bidders qualifying at the RFP stage.
In case the lowest bid obtained is not a competitive bid then the BPC
may have to resort to rebidding which would be a time consuming
process leading to difficulties in matching the time lines set for
commissioning the transmission system and make it available for the
upcoming generation plants of Bara, Karchana, Meja etc. He
emphasized that SCM is a method which cuts short the time involved
in rebidding and at the same time provides an opportunity to get
competitive prices.
The Commission sought the clarification from the petitioner
that under what circumstances the bids will be treated as
non-competitive. Director (Finance) explained that BPC has set a
benchmark price, and if the lowest quoted price is above the
benchmark price then the BPC shall adopt SCM to find a lower price.
He added that the benchmark price cannot be mentioned in the RFP
documents because every bidder will then quote its price just below
the benchmark price and the real spirit of bidding process shall be
lost. He however said that the benchmark price will be submitted to
the Commission.
Replying to a query of the Commission, Director (Finance)
confirmed that although SCM has been adopted in the state of UP
recently and is approved by Supreme Court of India who has
examined this method thoroughly from legal angle and from the point
of view of public interest. A copy of the judgment of the apex court in
this regard was handed over to the Commission during the hearing.
The representatives of M/s Isolux and Cobra were asked if
they had any objection to the adoption of Swiss Challenge Method
after hearing to the arguments of the petitioner, none of them made
any objection. Having heard the deliberations of BPC and both the
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bidders, the Commission decided that in the light of the fact that
there being very limited competition there is a likelihood of receiving
unreasonably priced RFP bids. Therefore the adoption of the Swiss
Challenge Method of bidding as explained in the foregoing
paragraphs is being permitted specifically in this particular case
Further the Commission observed that the revised format of
SCM does not restrict the bidders whose quoted price is same as
that of original lowest bidder. In view of this the Commission directs
the petitioner to modify the first paragraph of cl.3.4.1.5 of the revised
Swiss Challenge Method submitted by the petitioner vide letter
no.586 dated 03.06.10, as per the details below:
Existing paragraph-1
“….. The fresh bids under this process cannot be more than the
disclosed lowest original financial bid received …..”
Proposed paragraph-1
“….. The fresh bids under this process must be less than the
disclosed lowest original financial bid received …..”
The Commission also directs the petitioner to submit the
benchmark prices along with the detailed calculation to the
Commission after receipt of bids but prior to opening of the
bids.
d) In view of Commission’s remark that the affidavits of Sri A.K.
Singh, Chief Engineer, submitted by BPC earlier, does not mention
anything about RFP documents, the petitioner agreed to submit
fresh affidavits of Sri A.K. Singh with due correction.
e) Regarding Allocated Project Capacity of LTTCs, the petitioner
submitted that they have adopted the same allocation which they
have proposed in their ARR of FY 2009 – 10 and has been approved
by the Commission through its Tariff order of FY 2009-10. The
revised Allocated Project Capacity stated by the petitioner is as
mentioned in paragraph-10(4) above.
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f) Regarding details of other technical specifications and
parameters, Director (Finance), UPPTCL submitted that it shall be
the responsibility of the successful bidder to provide uninterrupted
services for which they shall decide on the other technical
specifications & parameters to be adopted. Both the bidders agreed
with the argument of the petitioner.
g) The Commission, during the hearing, gave an opportunity to
UPPTCL, M/s Isolux and M/s Cobra to discuss the queries raised by
both the bidders and the replies filed by BPC. Various issues were
discussed by the parties and finally the bidders agreed to the reply of
BPC on most of them. The issues which could not be resolved
through mutual discussion were taken up by the Commission as per
the following details :-
(i) The bidders emphasized to increase the time period of six
months mentioned in clause 3.1.3 ‘Conditions Subsequent’ of
TSAs. Director (Finance), UPPTCL submitted that if the
commissioning date remains the same, they are not
concerned with the time period of ‘Conditions Subsequent’.
The Commission directed the petitioner to amend clause
3.1.3, 3.2 and 3.3 as per the provision of the Standard Bid
document.
(ii) In clause 2.14.4 of RFPs regarding minimum equity holding /
equity lock-in; the bidders requested that it may be as per the
Standard Bid document; however BPC objected to it and
submitted that the intent of equity locking of the lead member
is to ensure that the technical & financial expertise should
remain in place through the lead member till the end of expiry
of TSA. M/s Cobra highlighted that such type of projects
consist of two different areas - technical expertise and
controlling & financial expertise and after the successful
commissioning of the project when requirement of the
technical expertise diminishes, there might be better people
available in the industry who could run the system in a more
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efficient manner. Further, the Commission is of the view that
the persons associated with the making of the Standard Bid
documents also must have taken this into account and
therefore directs the petitioner to align this clause as per the
provisions of SBD and accordingly modify clause 19.2 of
TSAs.
(iii) In view of the fact that the terms & conditions, mentioned
under Article-12 (Change in Law) of SBD also fulfill
UPPTCL’s conditions, the Commission directs the petitioner
to align Article-12 of TSAs as per the provision of Standard
Bid documents.
(iv) In view of the submission of the bidders that the last
paragraph of Schedule-11 of TSAs provides for Contract
Performance Guarantee with an indefinite extension of
validity period and normally no bank provides an open-ended
guarantee, the Commission directs the petitioner to amend it
in such a way that the validity of the guarantee may be
extended up to three (3) months after actual COD.
(v) In view of the request of the bidders and the consent given
by the petitioner regarding revocation of transmission license
mentioned under Article-13 of TSAs, the Commission
directed to align it with Sec-20 of Electricity Act, 2003.
(vi) Regarding mismatch in RFP and TSA documents, the
Commission directed the petitioner to eliminate them to
ensure the complete synchronism between them.
(vii) Regarding issues related with land acquisition, mechanism of
termination payment and liabilities of SPV, the Commission
directed the petitioner that these issues may be discussed
and resolved in the pre bid meeting.
(12) All the deviations listed in Annexure-D of RFP documents,
Annexure-1 of TSA documents and RFP corrigendum-1, 2 & 3 had
been merged by the petitioner into the modified documents,
submitted to the Commission on 27-04-10. Since the deviations are
Page 16 of 22
similar in nature both petitions are being decided by this common
order. Having heard the deliberations of UPPTCL and both the
bidders, the Commission approves some of the deviations of RFP
and TSA documents as listed below. The remaining deviations of
RFPs and TSAs shall be aligned as per the provisions of Standard
Bid Documents.
(i) In view of amendment made by Ministry of Power, GOI in
Standard Bid Documents of Request For Proposal (RFP) &
Transmission Service Agreement (TSA) for procurement of
Transmission Services through tariff based competitive
bidding vide letter no 15/01/2010/Trans dated 07-05-10
regarding enhancement of the term of the transmission
service agreement from twenty five years to thirty five years
and the request made by the UPPTCL during the hearing,
the Commission directs the petitioner to align the clauses
and annexure of RFP & RFP Project documents
accordingly as per the amendment.
(ii) The Commission observed that UPPTCL had revised the
originally proposed transmission scheme substantially
without obtaining the approval of the Competent Authorities
and the changes made by them were not of minor nature.
In view of such major changes and in order to ensure the
development of technically optimal transmission scheme
capable of evacuating the power of upcoming generating
stations the Commission opined that there was a need to
review the load flow studies carried out by CEA earlier and
directed the petitioner to obtain technical clearance of CEA
for the revised transmission scheme vide order dated
25-05-10. It was also directed that the petitioner shall also
submit the approval of BOD and ETF for the same. The
Commission took up the issue of the revised list of works
during the hearing of 18-03-10 and 18-05-10 and issued
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necessary directions to the petitioner vide orders dated
25-03-10 and 25-05-10. In view of the above the
Commission approves the revised list of works, mentioned
in clause 1.2 of the modified RFP documents, subject to the
technical clearance of CEA and the approval of BOD of the
transmission company and ETF. The Commission further
directs the petitioner that in case of any inconsistency
between the revised transmission scheme proposed by the
petitioner and that recommended by CEA, necessary
amendments shall be made in RFP & RFP Project
documents if it is received before the issue of final RFP and
RFP Project documents. In case the recommendations of
CEA are received after the issue of final RFP and RFP
Project documents then the same shall be adopted during
the implementation stage and the financial implications if
any arising out of this shall be resolved through mutual
discussions with the successful bidder / TSP. The
transmission scheme if revised after review by CEA shall
be submitted by the petitioner to the Commission for its
records.
(iii) The transmission system, mentioned in package-1 & 2, is
proposed to be established by TSP on Build, Own, Operate
& Maintain and Transfer (BOOT) basis instead of Build,
Own, Operate and Maintain basis (BOOM), mentioned in
the Standard Bid Documents. Such deviation was also
sought by the petitioner at RFQ stage which got approved
by the Commission vide order dated 15-10-09.
(iv) List of Long Term Transmission Customers and their
Allocated Project Capacities shall be taken as per
annexure-2 of petitioner’s letter dated 03-06-10 and the
annexure-1 of RFPs shall be modified accordingly.
(v) The calculation of the Contract Performance Guarantee,
Bid Bond and the liquidation damages, mentioned at clause
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3.3.3 of TSA documents has been done on the basis of the
project cost, which includes the lines and the substations
both; whereas in the Standard Bid Documents, the estimate
is prepared on kilometer length of line basis only without
the cost of substations. In view of the fact that a major
fraction of the project cost is to be incurred for the
construction of substations in both the packages, the
Commission allows the petitioner to consider the cost of
these substations as well while deciding the amount of the
Contract Performance Guarantee, Bid Bond and the
liquidation damages mentioned above. The Commission
has approved the similar criterion for computing the
technical and financial requirement of the bidders at RFQ
stage vide order dated 15-10-09.
(vi) In view of the fact that the transmission scheme under
package-1 & 2, is proposed to be established on Build,
Own, Operate & Maintain and Transfer (BOOT) basis, the
Commission approves the inclusion of clause 1.4 in the
RFP documents which mentions that at the expiry of the
TSA, all assets of SPV including substations, transmission
lines and other physical assets will be transferred to the
permitted nominee of the State Govt. at zero value.
(vii) The clause 2.14.1.1(6) of RFPs requires more than fifty
percent equity holding of the bidding company or member
of a consortium in technically / financially evaluated entities
for exemption of any undertaking from these entities
against a minimum of 26% specified in Standard Bid
Document. The Commission noted that the transmission
scheme under these petitions involving huge cost, is linked
to the commissioning of generation projects and only
serious players of sound technical experience and strong
financial capability should participate. Any delay in
commissioning of transmission projects would entail huge
Page 19 of 22
liquidated damages on long term transmission customers.
In view of above the Commission allows the amendment in
the above clause of the RFPs. The deviations made in
defining ‘Affiliate’, ‘Parent company’ and ‘Ultimate Parent
company’ are also approved by the Commission in view of
similar grounds. This was also approved at RFQ stage vide
order dated 15-10-09.
(viii) Important time lines, mentioned in clause 2.16.2 of modified
RFPs are to be adhered to subject to the revised date of
issuance of RFP Documents as per the reply of the
petitioner vide letter dated 03-06-10. The Commission
observes that thirty (30) days time period has been given to
the bidders for submission of RFP bids from the date of
issue of final RFP Documents and it is as per the provision
of Standard Bid Document. The time lines for opening of
financial bid, selection of successful bidder and issue of
LOI have been reduced marginally; however time allotted
for signing of RFP Project documents and transfer of SPV
is reduced to eight (08) days against thirty (30) days,
specified in SBD. The Commission allows the above time
lines of different events to ensure commissioning of
transmission Package-1&2 in synchronism with the
commissioning of upcoming generating projects. The
clauses 2.22.1 and 2.16.1 of RFPs shall be modified
accordingly.
(ix) In view of the fact that no fix date needs to be mentioned
for scheduled COD of the project, the Commission allows
that scheduled COD for the overall project shall be thirty
(30) months from the date of award of work to the
successful bidder, and directed the petitioner to amend
clause 2.15.1 of RFPs accordingly.
Page 20 of 22
(x) In view of the overall interest of the project, the
Commission allows the deviations made in clause 1.5 and
2.17.1 of RFPs regarding survey report to the bidders and
validity of bids respectively.
(xi) Inclusion of clauses 1.10, 1.11 & 1.12 in RFP documents
mentioning about the obligation of TSP regarding details of
works, broad specifications & technical parameters to be
followed, substation automation system, reactive power
management etc. the Commission decides that these may
be decided by the successful bidder provided it does it
under the supervision of UPPTCL.
(xii) Deviation in mentioning ‘Nominee of Long Term
Transmission Customers’ in RFP & RFP Project documents
in place of ‘Lead Long Term Transmission Customer’
specified in Standard Bid Documents.
(xiii) All the deviations sought by the petitioner in RFP & TSA
documents which are related with ‘intra-state’ system of UP
State.
(xiv) The Commission allows the clause 3.4.1.5, introduced in
the RFP documents for adopting Swiss Challenge Method
(SCM) of bidding as per its revised format subject to the
amendment directed by the Commission as per paragraph
11(c) of this order.
(xv) The Commission allows the clauses 2.3.3, 4.1(h) and
Article-16, introduced in TSAs in view of the proposed
transmission scheme being established on Build, Own,
Operate & Maintain and Transfer (BOOT) basis.
Page 21 of 22
(xvi) Deviations in clause 4.4.2 & 6.4.2 of TSAs are allowed in
view of the fact that the transmission system under these
petitions is linked to the commissioning of generation
projects and any delay in commissioning of transmission
projects would entail huge liquidated damages on long term
transmission customers.
(xvii) Deviation in clause 5.8 of TSAs is allowed in view of the
fact that the proposed transmission system under both the
petitions are for the state of UP (intra-state) and STU, being
responsible for planning of transmission system in the
state, should also monitor the performance of TSP during
the construction.
(xviii) Deviations in clause 6.1.2, 10.7(a), 10.7(c) & 10.8.1 of
TSAs are allowed to give the benefit to the end consumers
and deviation in clause 10.11.1(c)(i) of TSAs is allowed in
view of standard practice followed by UPPTCL in PGCIL’s
bills as mentioned by the petitioner.
(13) The Commission heard the matter of RFQ, RFP & RFP Project
Documents under both the petitions during five hearings held on
07-10-09, 18-03-10, 18-05-10, 03-06-10 and 08-06-10 and passed
orders on 15-10-09, 20-10-09, 25-03-10, 25-05-10, 03-06-10 and
08-06-10. The directions of the Commission, contained in these
orders, shall remain effective and are to be complied with by the
petitioner even though they are not being mentioned here to avoid
repetition.
(14) The petitioner shall remove the inconsistencies between RFP & RFP
Project documents and the modified RFP & RFP Project documents
shall be aligned with the approved RFQ documents.
Page 22 of 22
(15) The petitioner must ensure that each deviation in the RFP & RFP
Project documents from the Standard Bid documents are approved
by ETF prior to issue of final RFP and RFP Project documents.
(16) The RFP & RFP Project Documents under the above mentioned
petitions shall be modified according to the decisions and directions
of the Commission. The modified documents shall be issued to both
the bidders, M/s Cobra Instalaciones and M/s Isolux Corsan, within
seven (7) days of this order and thereafter the RFP bids shall be
submitted by both the bidders in next thirty (30) days.
(17) Copies of modified RFP & RFP Project Documents shall be
submitted to the Commission for information and records.
(18) The petitions are disposed of.
(Rajesh Awasthi) Chairman
Lucknow; Dated 2nd July 2010
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