The results of NTPC's bulk
tendering process for nine
supercritical power units of 800-
mw has churned out interesting results
that could potentially define a new
paradigm in the power equipment
industry in India. The most striking
observation has been that BHEL —
India's biggest power equipment
supplier failed to emerge as the lowest
bidder (L1). Future supercritical plants
are likely to see a new crop of equipment
suppliers and an interesting
competition between BHEL, domestic
manufacturers that have formed joint
ventures with foreign players, and of
course Chinese players.
NTPC had invited separate bids for
boilers and turbine-generators for nine
supercritical units of 800-mw,
aggregating 7,200 mw. This equipment
is to be deployed in four projects spread
over Orissa, Chhattisgarh and
Karnataka (see Table 1).
TABLE 1: NTPC'S BULK TENDERING |
Project |
Location |
Capacity |
Lara |
Chhattisgarh |
2x800 mw |
Darlipali-Stage 1 |
Orissa |
2x800 mw |
Gajmara-Stage 1 |
Orissa |
2x800 mw |
Kudgi-Stage 1 |
Karnataka |
3x800 mw |
For the boiler package, Doosan Heavy
Industries of Korea emerged as the
lowest bidder. According to the tender
documents, Doosan will be entitled to
supply five units while BHEL will
supply four units. It may be mentioned
that BHEL will be entitled to supply
equipment, regardless of its bid,
provided it matches the winning quote.
Accordingly, BHEL will be supplying
four boiler packages at the L1 rate. The
other aspirants for the boilers package
were Larsen & Toubro, BGR Energy
Systems and Thermax.
For the turbine-generator (TG)
package, BGR Energy Systems was the
lowest bidder for all nine units.
Accordingly, BGR will be mandated to
supply five units. Regarding remaining
four, it is learnt that while BHEL will be
supplying two units, L&T-MHI will be
contracted to supply two units. When
contacted, a highly-placed NTPC
official confirmed the L1 winners for
both packages but refrained from
commenting on the final award of the
packages as it was yet in process. The
TG package saw nine entities in the race
with five qualifying to submit their
price bids. Bharat Forge-Alstom and
Toshiba were the other two contenders.
Aggressive bids: The winning bids
were found to be very aggressive, even
up to 20 per cent lower than the
victorious bids of NTPC's previous
round of bidding when it had ordered 11
sets of supercritical equipment of 660-
mw rating. (This round of bidding
incidentally is yet under finalization as
some bidders have challenged their
disqualification.) Doosan in emerging
L1 for the boiler package had quoted
1.60 crore per mw while BGR Energy is
believed to have quoted
0.94 crore per
mw for the TG package.
L1 BIDDERS
Doosan: The boiler package deal will
boost Doosan's presence in India. The
South Korean company is already
involved as equipment supplier to
three power projects aggregating over
7,300 mw. For the 4,000-mw Mundra
UMPP being developed by Tata Power,
Doosan is supplying supercriticalgrade
boilers. It is also supplying
similar equipment for NTPC's 3x660-
mw Sipat project in Chhattisgarh. For
the GMR Group, Doosan has won the
complete main plant package (BTG)
for the 1,370-mw Raipur coal-fired
power project in Chhattisgarh.
Doosan Heavy Industries is moving to
building a manufacturing plant in
India. In February this year, it acquired
the Chennai power equipment (boiler)
plant of Austria's AE&E Group in a
€20.5-million deal. BGR Energy
Systems, based in Chennai, has
traditionally been a "balance of plant"
player and is now emerging as a main
plant supplier to thermal power
projects. To cater to main plant
equipment with supercritical
parameters BGR has forged an alliance
with Hitachi Ltd of Japan and Hitachi
Power Equipment GmbH of Germany.
Two joint ventures—one each for
boilers and turbine-generators—have
been formed. The respective
manufacturing units of these JVs are
likely to go in production by 2012.
Untitled Document
TABLE 2: SUCCESSFUL BIDDERS* |
|
Boilers |
TG Sets |
Doosan |
5 |
— |
BHEL |
4 |
2 |
BGR Energy |
— |
5 |
L&T-MHI |
— |
2 |
*Based on reports |
Reducing margins: Some analysts
are of the opinion that there could be a
surfeit of supercritical power equipment
suppliers in the coming years. A large
number of joint ventures have been
formed between Indian and foreign
companies to set up manufacturing
capacities in the country. Apart from
this, China is a huge favourite amongst
private power players. In the coming 3-4
years, India's total manufacturing
capacity of main plant equipment is
likely to be around 30,000 mw. The longterm
annual demand, on the other hand,
will be in the range of 15,000-17,000 mw
per year.With aggression in bidding
already evident, profit margins of
equipment suppliers might come under
pressure, it is believed.