Sumitomo, China Light, Israel Electric vie for Indian power project

Sumitomo, China Light, Israel Electric vie for Indian power project

Bangalore: Three overseas bidders are competing with six Indian companies to build a $4-billion power plant in Andhra Pradesh, officials said on Tuesday, 16 October.

Sumitomo Corp., China Light and Power and Israel Electric Co. have submitted bids for the 4,000-megawatt project, said a senior government official involved in the bidding process.

The bids will be opened on 24 October and the contract to build and operate the plant awarded next month, said the official, who spoke in a telephone interview on condition of anonymity.

China Light and Power and Israel Electric have teamed up with local partners for the Krishnapatnam project, he said.

The six Indian companies independently bidding for the contract are Tata Power, Reliance Energy, Larsen and Toubro, Essar Power, National Thermal Power Corporation and Sterlite Industries.

A senior official at the Andhra Pradesh Power Generation Corp., in an interview from the state capital Hyderabad, said the criteria for deciding the winner includes the price at which the developer will sell the electricity.

The Krishnapatnam project is one of several 4,000-megawatt plants proposed by India, struggling to close an ever-increasing gap between electricity supply and demand as the economy surges ahead at 9% a year.

The government plans to add 100,000mw of electricity generation by 2012 to supply “power to all" in a nation of 1.1 billion people where industries, farmers and households cope with chronic outages.

“India has one of the weakest electricity infrastructures in the world, and at the same time hi-tech industries for whom power cuts are intolerable," the chief executive of Schneider Electric, Jean-Pascal Tricoire, told AFP during a visit to India in October.

“If a power cut stops a lift from working in one of the many prestigious buildings you see being built now in India, then that building loses its value. A one-hour power cut in a stock exchange costs millions of dollars," he said.

Companies like Schneider Electric, ABB and Siemens that provide electrical systems including power back-ups are eyeing huge sales in India as the country struggles to keep pace with demand.

The government estimates that $475 billion of investment is needed by 2012 in infrastructure including electric power, road, rail and air transport, telecommunications, water supply and irrigation.