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What's New



Date: 5th May 2009

 

Proposed New Eligibility Rules for Infrastructure Projects in India - A comparison

 

Following are the modifications finalized by the five member task force headed by Mr. B.K. Chaturvedi, member Planning Commission and will be issued shortly.

 

Sl. No.

Eligibility Criteria

Present Situation

Proposed Criteria

1.

Short listing of number of bidders (For projects costing more than Rs. 500 crore, except highway projects)

6 bidders will be short listed.

7 bidders will be short listed.

1A.

 Short listing of number of bidders (For projects costing less than Rs. 500 crore, except highway projects)

6 bidders will be short listed.

8 bidders will be short listed.

1B.

Short listing of number of bidders in Highway Projects

All the bidders, who technically qualify

All the bidders, who technically qualify

2.

Preparation of reserve list of bidders, other then top 7/8.

No such provision.

List of pre-qualified applicants needs to be prepare, who may be invited to substitute the shortlisted bidders in the event of their withdrawal or failure to conform to the tenders terms.

3.

Provision of excluding  applicant

No such provision.

Project implementation authority has to exclude the applicants, if they are found to make false claims to improve their score.

4.

Conflict of interest

An applicant is considered conflict of interest, if it has direct or indirect shareholding of more than 1% in an other applicant firm or its associate, an in case of consortium, in any of its members.

An applicant is considered conflict of interest, if it has direct or indirect shareholding of more than 5% in an other applicant firm or its associate, an in case of consortium, in any of its members.

5.

Bar on Technical Capacity

Equal to estimates project cost.

Twice the estimates project cost.

Date: April 2009

 

Ministry of Commerece come out with LLP Act.

Dated: 20 January 2009

CERC issues Tariff Regulations for next five years

 

CERC issued the Tariff Regulations for generation and transmission projects for the period 2009-14 on 20 January 2009,

 which consist the following features:

 

(1) The base rate for allowing return on equity has been raised from 14% to 15.5%.

(2)  Provide incentives and an additional return on equity of 0.5% to those projects which

are commissioned timely.

(3) To Boost development of hydro power projects several provision like New Hydro Power Projects have been appropriately insulated from hydrological risk during the first 10 years of their operations and also allow enhanced free power and rehabilitation cost.

(4) Return on equity will be now pre-tax for which the base rate of 15.5% would be

grossed up by applicable tax rate for the company.

(5) Consumers would not have to bear the burden of income tax on the UI earning, incentive earning and efficiency gains of the projects.

(6) Depreciation rates have been reworked to take care of repayment of debt obligations of the new projects. However, once the initial period of 12 years is over, remaining depreciation would be spread over the balance useful life to keep the tariff reasonable.

(7) The economies of scale available to the developers in operation of expansion projects are to be shared with the beneficiaries as the permissible O&M expenditure will be rescaled for new expansion units.

(8) CERC has decided to set up capital cost benchmarks for thermal power projects and transmission projects.

(9) The incentive available to the generating companies will now be available on the basis of declared availability instead of plant load factor.

(10) The commission has been decided to bring out a separate tarrif regulation for renewable energy based projects.

(11) The availability target for recovery of fixed cost for thermal power plants has been raised from 80% to 85%. Operating margin of only 6.5% would be permited with respect to the design heat rate. The norm for secondary oil consumption has been slashed from 2 ml per unit to 1 ml per unit.Further, the savings in secondary oil consumption are to be shared with the beneficiaries in ratio of 50:50%.

 (12) Tariff regulations have given due attention to the need of renovation and

modernization. The companies operating thermal power plants will have now two

options. Either they can claim a special allowance on the basis of per MW per year after

completion of normative useful life of the project and will be obligated to deliver the

norms set for availability and operations. Second option is to go for comprehensive R&M

which is to be permitted by Commission on the basis of detailed cost benefit analysis

including the efficiency gains to the beneficiaries.

 
   
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