BOW basis to be adopted for 2 thermal power projects in Punjab

Chandigarh, May 21 (UNI) The two coal-besed thermal power projects that the Punjab government proposes to develop at Talwandi Sabo in Mansa district and Majhi in Sangrur would be awarded to companies on Build, Own and Operate (BOW) basis and under tariff-based International Competitive Bidding (ICB).

Disclosing this at a bidders' conference held here today, Chief Secretary Ramesh Inder Singh said that the entire power of 1200 MW generated from each of the two projects would be utilised by Punjab State Electricity Board (PSEB). The size of these projects being large, they were expected to meet the power requirements of the state, he added.

This initiative of the Government assumes significance as it aims to encourage private investment in the power sector and also endeavours to promote public-private participation in power generation, he added.

He further said that in order to enhance investors' confidence, reduce risk perception and to ensure good response to competitive bidding, two Special Purpose Vehicles (SPVs)--- Talwandi Sabo Power Ltd (TSPL) and Nabha Power Ltd (NPL) have been set up under Companies Act as wholly-owned companies of PSEB. The SPVs would acquire land for the projects, ensure linkages for coal, water and undertake studies for transportation, hydrological and topographical and other studies and surveys necessary for preparation of detailed project report (DPR), he said.

Mr Singh assured the bidders present that the state government and PSEB would ensure proper security mechanism for the private developers in form of letter of credit and default escrow mechanism.

The SPVs shall be transferred to the successful bidders at the end of the bidding process and on payment of development costs incurred by the SPVs, he pointed out.

The sites for the proposed projects have been cleared by the Central Electricity Authority (CEA) and land to the extent of 1300 acres for each project, had been identified and the process of land acquisition is on, he said.

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