Case: Coastal Andhra Power Ltd. (CAPL) Vs Andhra Pradesh Central Power Distribution Company Ltd. and Ors.. Central Electricity Regulatory Commission
| Judges | Pramod Deo, Chairperson, S. Jayaraman, V.S. Verma and M. Deena Dayalan, Members |
| Issue | Electricity Law |
| Judgement Date | August 02, 2010 |
| Court | Central Electricity Regulatory Commission |
Order:
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This petition has been filed by the petitioner Coastal Andhra Power Limited (CAPL) for approval of change in the unit configuration in respect of the Krishnapatnam Ultra Mega Power Project (5 x 800 MW) (hereinafter referred to as the "project") to 6 units of 660 MW each (6 x 660 MW). The petitioner has made the following specific prayers in the petition:
(a) To allow the petitioner to choose the 6 x 660 MW unit configuration in terms of the amended standard bid documents;
(b) To grant in-principle approval to the supplemental PPA and permit the parties to enter into the same; and
(c) To pass such order or further orders as Hon''ble Commission may deem fit and proper in the facts and circumstances of the case.
BACKGROUND
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The petitioner was incorporated on 24.8.2006 under the Companies Act, 1956, as a wholly owned subsidiary of the Power Finance Corporation Limited (PFC). As a part of the Ultra Mega Power Project (''UMPP") initiative, the Govt. of India had entrusted the PFC the role of a nodal agency to procure, through competitive bidding, developers for establishing and operating generation capacity based on super critical technology.
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PFC was authorized by all the respondents (hereinafter referred to as"the procurers'') as the authorized representative for discharging all the rights and obligations of the procurers to undertake the competitive bidding process in line with guidelines specified by of Government of India, for selection of a bidder to acquire the petitioner company and thereafter to build, own and operate the project.
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The competitive bidding process was initiated on 12.7.2006. At the time of submission of the bids for the project, the bidders had the option to choose the unit configuration amongst 660 MW/800 MW/1000 MW units subject to
(a) the contracted capacity being in the range of 3500 MW to 3800 MW.
(b) the Project being based on super critical technology.
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The sole criteria for award of the project was the levellised tariff without any linkage to unit size, due to which the unit configuration was left to the bidder''s choice and was not part of the bid evaluation and consequently, had no impact on the award of the Project.
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The petitioner executed a Power Purchase Agreement (PPA) with the procurers on 23.3.2007 and in terms of the said PPA, the allocation of power from the project was as under:
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| Sl. No. | Procurers | Allocated |
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| | | Gross Capacity |
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| | | (percentage) |
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| 1 | Distribution companies of Andhra | 40.00% |
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| | Pradesh (Respondent Nos. 1 to 4) | 20.00% |
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| 2 | Distribution companies of Karnataka | 20.00% |
| | (Respondent Nos. 5 to 9) | |
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| 3 | Maharashtra State Electricity | 20.00% |
| | Distribution Co. Ltd (Respondent | |
| | No.10) | |
__________________________________________________________________________________
| 4. | Tamil Nadu Electricity Board | |
| | (Respondent No. 11)
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| | Total | 100.00% |
__________________________________________________________________________________
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Reliance Power Limited (RPL) submitted its bid on 24.10.2007 and offered a contracted capacity of 3800 MW based on the configuration of 5 units of 800 MW each (5 x 800 MW). Along with its bid, the requisite declaration as per Format-3 of Annexure-6, was also submitted by RPL, which inter alia stipulated that for 5x 800 MW configuration, the sum total of the contracted capacities of all the units shall not be less than 3500 MW and more than 3800 MW at the delivery point.
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In terms of levelised tariff, RPL emerged as the successful bidder through competitive bidding process and was issued the Letter of Intent (LoI) on 30.11.2007. The tariff of the project was adopted by the Commission in its order dated 25.1.2008 in Petition No. 170/2007.
Submission of the Petitioner
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The Petitioner has submitted that the case-2 Standard Bid Documents, particularly the PPA were amended by the Ministry of Power on 21.9.2007 by inserting Clause 3.1.1A which provided for the unit configuration flexibility to the bidders with the option to choose the configuration at any time before Notice to Proceed as contemplated under the PPA subject to the seller submitting an undertaking that the changed unit configuration would meet all the conditions specified in Format 3 of annexure-6 of RFP and all functional specifications. The petitioner has further submitted that since the PPA between the seller and the procurers has already been signed in respect of the project on 23.3.2007 i.e. prior to the amendment to the Standard Bid Documents, the amended provisions of Clause 3.1.1A could not be made part of the PPA for the project.
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The petitioner has further submitted that the tariff for the project was adopted by the Commission under Section 63 of the Act vide its order dated 25.1.2008 Petition No. 170/2007 directing that "the tariff adopted shall be charged in accordance with the provisions of the PPA and the bid of the selected bidder as accepted by the procurers which has been subsequently made a part of the PPA". After execution of share purchase agreement between Reliance Power Ltd., Power Finance Corporation Ltd. and Coastal Andhra Power Ltd. on 29.1.2008, the petitioner became a subsidiary of Reliance Power Ltd.
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The petitioner has submitted that in response to its discussion with the domestic and overseas suppliers of boiler, turbine and generating equipment, it received the proposal for the options of 660 MW, 800 MW and 1000 MW unit configuration. While evaluating the proposals, the petitioner noticed that it would be feasible to advance the commissioning schedule of the project in case it has the flexibility in choosing the unit configuration amongst 660 MW, 800 MW and 1000 MW which would benefit the procurers and end consumers in the context of the...
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