The state-owned power producer, Karnataka Power Corporation Limited (KPCL) is set to issue a request for proposal (RFP) to pre-qualified bidders for the EPC works for the proposed Bidadi Combined Cycle Power Project (BCCPP). The KPCL is developing the state’s first LNG-based 700 Mw power project at an estimated cost of Rs 4,200 crore at Bidadi, about 35 kms from Bangalore.
“The cabinet has already approved the development of the project. However, KPCL is yet to get one final approval from the state government before it signs the gas transportation agreement with the GAIL India Ltd. We expect the approval to come very soon and start the construction work this year,” Shamim Banu, additional chief secretary, energy department, government of Karnataka said.
KPCL had floated a request for qualification (RFQ) from the interested bidders last year for the EPC works and shortlisted over five companies. The RFP documents would be issued shortly, she said.
During the global investors’ meet (GIM) held in June 2010, the state government had signed an agreement with GAIL India to lay the gas pipeline between Dabhol in Maharashtra and Bidadi near Bangalore to transport gas. Subsequently, GAIL India began laying the pipeline and the work is likely to be completed within the next one year. However, the private sector power developers are still to finalise their plans to set up projects along the pipeline.
The KPCL, which earlier planned to set up a 1,400 Mw project, scaled down its capacity last year to 700 Mw mainly due to the very high prices for the Liquefied Natual Gas (LNG) in the international market. The state cabinet has also approved the KPCL’s proposal to buy LNG on the spot market as the long-term contract involves higher risk and works out expensive for the first block of 1x700 Mw with plus or minus 20 per cent.
“As of now, we have decided to take up the first unit of 700 Mw project due to the high international prices for LNG. We will scale it up later depending on the gas prices,” Banu said. The entire power generated from the project will be allocated to the Bangalore Electricity Supply Company (Bescom) since the plant is near the load centre which could accommodate the requirement of peak load.
Meanwhile, as a short-term measure to manage during the summer months, when the requirement for power goes up, the government would buy 1,000 Mw power on a daily basis, she said.
“We have tied up with private producers for the supply at an average cost of Rs 4.30 per unit everyday. We are hopeful of commissioning the second unit of 500 Mw at the Bellary Thermal Power Station (BTPS) very soon depending on the availability of coal. If that is commissioned we should be able to manage the crisis during summer months quite well,” Banu said.