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Panel favours cap on bidders for UMPPs

NEW DELHI: In a bid not to allow monopolistic activities to take shape in the bidding and execution of the Ultra Mega Power Projects (UMPPs), the Empowered Group of Ministers (EGoM), headed by Power Minister, Sushil Kumar Shinde, is actively considering putting a cap of two projects per developer to allow adequate competition.

Highly placed sources said that the matter had come up for discussion during an informal meeting of the EGoM on Thursday. The Power Secretary, Anil Razdan, is understood to have raked up the issue. Sources said the matter had been raised in the past also when it was pointed out that the Government should formulate norms to ensure that no single developer manages to get monopoly over the development of the UMPPs. “It has come to the notice of the Government that in all the three UMPPs put up for development till now, three to four firms figure in the top five in the bidding process which is not a pleasant development,” a senior official said. The EGoM is understood to have asked the Power Finance Corporation (PFC) to take a close look at this situation and work out norms to be placed before the EGoM for consideration.

Close on the heels of this meeting, the Parliamentary Standing Committee on Energy, headed by Gurudas Kamat, in its latest report on UMPP, has favoured barring companies, which have already bagged a 4,000 MW UMPP, from bidding for another on the basis of the same balance-sheet so as to ensure adequate competition. However, it feels that if the balance-sheet of the company is strong enough to meet the eligibility criteria for two projects, then it can be allowed to take part in the bidding for the second project. In its report tabled in Lok Sabha on Friday, the committee said that such a step would encourage competition and ensure that the power sector was not monopolised by a few companies.

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