Even as a controversy builds up around the change in project specifications for its power project at Anpara C in Uttar Pradesh (UP), Lanco Anpara Power Pvt. Ltd has applied to the Union government for an increase in coal linkage or dedicated coal supplies.

Madhusudan Rao, Chairman, Lanco Group

Lanco won the project by making the lowest bid of Rs1.91 per unit of power and recently signed a power purchase agreement with the UP government.

However, the company’s decision to change the project specification after winning the bid, from two units, each of 500MW capacity to two units, each of 600MW capacity, has attracted the ire of competitors such as Essar Power Ltd and Reliance Energy Ltd, both losing bidders.

The change in project specifications has already been approved by the UP government and Uttar Pradesh Rajya Vidyut Utpadan Nigam Ltd, the state-owned firm that will buy power from the project.

Reliance Energy Ltd has already written to Union power secretary Anil Razdan for, “...intervention in the matter to assure fairness, transparency and equal competition among all bidders and give the bidders opportunity to consider revised bid conditions and submit revised offers."

“The UP government cannot change the basic specifications of the bid," Mukesh Tyagi, head (business development group), at Essar Power had earlier told Mint.

When contacted L. Madhusudhan Rao, chairman, Lanco Group, declined to comment on the issue. However, a Mumbai-based power sector expert who did not wish to be identified said that a change in specifications is “hardly an issue from the technical standpoint". The expert added that much of the controversy had to do with Lanco’s involvement in the project.

Another company that is part of the Lanco Group, Lanco Infratech Ltd, was in the news recently when the 4,000MW ultra mega power project at Sasan was taken away from it and awarded to Reliance Energy Ltd through a rebid because the company had flouted some bid conditions.

“It is for the UP state government to decide on the (Anpara C) project," said R.D. Gupta, member, Uttar Pradesh Electricity Regulatory Commission, the state’s electricity regulator.

Work on the project had earlier come to a halt following strong opposition from the state’s power sector employees and the Left Front on the privatization issue.

Anpara C is a pit-head station that will receive coal supplies from Northern Coalfields Ltd. The total project cost is around Rs4,800 crore and the project is expected to be commissioned by 2011.

UP currently has a demand of around 7,500MW against a supply of 5,500MW.