NTPC revives power equipment award process, places orders worth Rs. 6,000 crore

India is planning to set up a bulk of its capacity on supercritical and advanced ultra-supercritical equipment

NTPC Ltd, which failed to award contracts for power equipment since 2009 because of land and legal issues, has placed orders worth Rs. 6,000 crore with Doosan Heavy Industries and Construction Co. Ltd and Toshiba JSW Turbine and Generator Pvt. Ltd for its 2,400megawatts (MW) Kudgi project in Karnataka.

“We have placed the orders for Kudgi as it was the only project for which land was available,” chairman and managing director Arup Roy Choudhury said. “It is a good start.”

Key hurdle: NTPC chairman and managing director Arup Roy Choudhury says orders have been placed for Kudgi as it was the only project for which land was available.

The supercritical equipment order, which was earlier supposed to be part of India’s biggest power generation contract, is for three units of 800MW each. While Doosan has been awarded the boiler part of the tender valued at around Rs. 3,796 crore, Toshiba JSW, a joint venture of Toshiba Corp. and the JSW group, has been given an order worth Rs. 2,300 crore for supplying turbine generators. Toshiba Corp. owns a 75% stake in the venture.

The equipment will help NTPC improve plant efficiency and achieve economies of scale. By 2032, about half the country’s generation capacity is expected to be coal-based.

To mitigate the shortfall in coal, India is planning to set up a bulk of its capacity on supercritical and advanced ultra-supercritical equipment, which are more efficient.

NTPC had sought bids for around Rs. 22,000 crore of boilers and turbine generators for nine units of 800MW earlier last year for proposed projects at Kudgi, Lara (1,600MW) in Chhattisgarh, and Darlipali (1,600MW) and Gajmara (1,600MW) in Orissa. The projects will have a total capacity of 4,000MW each after all the phases of development are completed.

NTPC requires an acre of land per megawatt. Mint reported on 27 December that the utility has been unable to place bulk orders for four projects (nine units of 800MW each) as it has been unsuccessful in acquiring land for the proposed projects at Lara, Darlipali and Gajmara.

While Doosan will get orders for boilers for two additional units of 800MW each, the remaining four units will go to state-controlled Bharat Heavy Electricals Ltd (Bhel). Similarly, a joint venture of BGR Energy Systems Ltd and Hitachi Power Europe GmbH and Bhel will get remaining turbine generator orders for four and two units, respectively.

“The other orders will be placed in due course of time as and when we get the land for other projects,” said another NTPC executive, requesting anonymity.

NTPC is also set to place orders worth another Rs. 22,000 crore for 11 supercritical boilers and an equal number of turbines of 660MW each with the Supreme Court ruling that Ansaldo Caldaie Boilers India Pvt. Ltd, a unit of Italian boiler maker Ansaldo Caldaie SpA, had failed to technically qualify for the bidding process.

The bidding process for supercritical boilers was stalled by Ansaldo Caldaie Boilers India’s petition to the Delhi high court in 2011 after it was disqualified by NTPC on technical grounds. The high court had directed NTPC not to open commercial bids until it decided on the matter and finally ruled in Ansaldo’s favour. NTPC then appealed the decision in the Supreme Court.

NTPC will now invite price bids from Bhel and the joint ventures of BGR Energy Systems Ltd and Hitachi Power Europe GmbH; and Larsen and Toubro Ltd and Mitsubishi Heavy Industries Ltd, which had technically qualified for the boilers order. While the joint venture of Bharat Forge Ltd and Alstom SA has already emerged as the successful bidder eligible for the award of five turbine units, Bhel and Toshiba JSW are to be awarded two units each.

Toshiba will also supply two 660MW sets for the Salaya-II thermal power plant run by Essar Power (Gujarat) Ltd. The company has also received a letter of intent for the purchase of two 660MW turbine and generator sets for an NTPC project in Uttar Pradesh. Toshiba JSW will have a capacity of 3,000MW by 2013, and 6,000MW by 2015, the company’s managing director, Itaru Ishibashi said last week.

NTPC currently has an installed power generation capacity of 36,104MW and projects totalling 14,088MW under construction.