Tariff Based Competitive Bidding (TBCB) Expectation from Field Engineers in MSETCLs TBCB Participation Project Summit - 2025 The Electricity Act, 2003 Part VII Tariff (6 Sections) Section 61. Tariff regulations Section 62. Determination of
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Presentation Transcript
01
Tariff Based Competitive Bidding (TBCB)
Expectation from Field Engineers in MSETCL’s TBCB Participation
Project Summit - 2025<br>
02
The Electricity Act, 2003
Part VII Tariff (6 Sections)
Section 61. Tariff regulations
Section 62. Determination of tariff
Section 63. Determination of tariff by bidding process
Notwithstanding anything contained in section 62, the Appropriate Commission shall adopt the tariff if such tariff has been determined through transparent process of bidding in accordance with the guidelines issued by the Central Government.
Section 64. Procedure for tariff order
Section 65. Provision of subsidy by State Government
Section 66. Development of market MoP, GOI
Ministry of Power, Government of India, notified in April 2006 - Tariff Based Competitive Bidding (TBCB) Guidelines for Transmission Service and Guidelines for Encouraging Competition in Development of Transmission Projects
Subsequently Standard Bidding Documents (SBD) issued by MoP in the year 2008 :
Request for Qualification (RfQ),
Request for Proposal (RfP) and
Transmission Service Agreement (TSA)
Further, based-on stakeholders' consultation, an exercise of comprehensive review of above documents was taken.
MoP, GoI has notified revised documents in Aug,-2021, modifications were done in Standard Bidding Documents(SBDs) including Request for Proposal (RFP), Transmission Service Agreement (TSA) and Share Purchase agreement TBCB – Regulatory aspects<br>
03
Cost Plus (RTM) TBCB Projects on Nomination Basis Projects on Competitive Bidding
Route No Requirement of Acquiring New
Company Requirement of Acquiring Special
Purchase Vehicle Execution First, Tariff
Determination Later (u/s 62 of EA) Tariff Determination First,
Execution Later (u/s 63 of EA) Market, Interest Rate, Route
Change Risk etc. passed through No protection against MOST of
the risks Non Completion of project may lead deduction of IDC & IEDC beyond SCoD Non-Completion of project by
SCoD leads to levy of hefty LD No need to furnish Contract Performance Guarantee Contract Performance Guarantee to be furnished No need to Grant of License from
MERC License is required from MERC RTM (Cost-plus) vs TBCB<br>
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Cost Plus TBCB One Company Dominance -MSETCL Many Companies – POWERGRID,
Sterlite, Adani, Reliance etc. LD provisions are not very
stringent Quantum of LD, Availability Incentive
/ Penalty – HUGE Any optimization of cost/route
not generally done Cost optimization can lead to
better returns Monopolistic Market Driven Market Intelligence not required Market Intelligence required Tariff is fixed by CERC for 5- year
block Tariff is fixed for full operational
file of project ( 35 years) Routine Work Change in approach required RTM (Cost-plus) vs TBCB<br>
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Threshold Limit for Project through TBCB<br>
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Selection of Projects in RTM and TBCB<br>
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These Players will participate in Intra-State TBCB Projects , With every bid many new players are entering into Transmission TBCB sector TBCB market Competition – ISTS Projects<br>
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These Projects is proposed to be developed through TBCB mode Maharashtra Energy Transition Plan (2024-25 to 2033-34)<br>
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Publication of RFP Technical and initial offer submission. Selection of Successful Bidder and
Issuance of LoI Zero Date Publication of Gazette Notification for BPC’s 2 Days e-reverse bidding after opening of the initial offer 40 Days 65 Days 75 Days 10 Days post issuance of LOI 8 Days post close of e-reverse bidding process 83 Days 93 Days Bid clarification, conferences etc. & Revision of RFP Signing of Agreements & SPV Transfer Technical & Financial bids are submitted with RFP
Financial Bid comprises of 2 rounds (Only Initial Offer to be submitted with RFP)
Once Technical requirements are met, Initial offer is opened and ranked in ascending order Top 4 qualify for the e-Reverse Auction (e-RA)
e-RA starts with the lowest levelised tariff from initial offer of the Qualified Bidder. In e-RA the tariff has to be reduced by 0.25% of the prevailing tariff
Initial period of e-RA is 2 hrs. Time is extended by 30 minutes if bid is received in the last 30 minutes TBCB – Bid timeline as per Standard bidding document<br>
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Technical Requirement:
Experience of development or construction of projects in the Infrastructure Sector (Not necessary in Power Sector) in the last five (5) years.
Th Bidder must have executed Projects in last 5 Years with minimum aggregated capital expenditure, equal to cost of TBCB project under bidding (Minium Threshold limit is 500 Crs) or aggregate payments received for projects shall be equal to cost of TBCB project under bidding, but not less than 500 Crs (applicable for EPC)
Individual project experience to be calculated @ 20% of the project cost under bidding but not less than 100 Crs each.
Financial Requirement :
Net worth is to be calculated @ 40% of the required aggregate capital cost of projects/ aggregate payments received for the projects. However, the minimum requirement of Net worth shall be Rs. 250 crore.
The Net worth should be based on unconsolidated/consolidated, audited annual accounts of any of the last three (3) Financial Year’s, immediately preceding the bid deadline. TBCB Standard Qualifying Requirements as per Standard Bidding Document<br>
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Only Annual Transmission charges in Rs. Million to be quoted, Same Shall be payable for 35 Years
Monthly tariff = Annual tariff * (no. of days in that month/no. of days in the year) Financial bid Submission<br>
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MSETCL has established a dedicated TBCB team is headed by CE(TBCB) under the leadership of CMD, MSETCL.
Development of comprehensive policies and Standard Operating Procedures (SOPs) to govern all aspects of TBCB participation including pre-planning, bid preparation, and project execution is under process.
MSETCL, TBCB Cell is taking initiatives to encourage Reputed EPC players for Pre- Bid tie up by revising QR and GTC for TBCB Projects
Financial Modeling Consultant has been appointed for Tariff estimation
Survey Agencies with experience in TBCB projects are empaneled .
Technical Specification of Major equipment's like Transmission line, ICT and major substation equipment are being modified for Cost optimization and latest specification in line with BPC MSETCL as a bidder: Initiatives for participation in TBCB projects<br>
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MSETCL as a bidder: Pre-bid activities support from Field office<br>
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MSETCL as a bidder: Post-bid activities Execution of project within Targeted Cost and time
Close monitoring of construction progress as per L2 Schedule/agreed schedule
Timely initiation of Statutory proposals within Targeted timeframes.
Progress reporting to BPC and Intimations of events like Force Majure, hindrances.
Initiation of proposals for Contractual Amendments during executions within time.
