The UP government today finally cleared the decks for the award of the 1,980-MW Bara thermal power project to come up at a cost Rs 9,000 crore in Allahabad district to Jai Prakash Industries, whose bid was found to be lowest with Rs 3.02 per unit.

The bid for the Bara project was floated for the third time. In the third bid, Lanco Kundapalli, a Hyderabad-based firm, emerged as the lowest bidder by quoting Rs 3.09 per unit, closely followed by JP group with Rs 3.10 per unit and Reliance energy Rs 3.12 per unit.

The state government had requested the bidders to reconsider the bids and reduce the price. The JP group agreed to reduce the price by 8 paisa and its bid became lowest with Rs 3.02 per unit. The two other firms, Lanco and Reliance, did not participate in the re-bidding today, it is learnt.

The government was in such a tearing hurry to award the project to the JP group that all formalities like the report of the bid evaluation committee to the energy task force (ETF) headed by the chief secretary was completed today.

The ETF will now submit its report to the Cabinet after which the “letter of intent” will be issued by the UP government to the successful bidder. The official sources neither confirmed nor denied whether the cabinet approval has been obtained and the letter of intent issued to the JP group.

The government had first invited the bids for this project in April 2008. Then, Lanco Kondapalli emerged as the lowest bidder with Rs 2.28 per unit. The government, however, found the bid price too high and unsustainable in the long run and cancelled the bid to float global tenders again.

In the second bid in June 2008, the Anil Dhirubhai Ambani group’s Reliance Energy Limited outbid Lanco to emerge as the lowest bidder by quoting Rs 2.64 per unit. This bid too was cancelled as this price was also found to be high and unsustainable.

The third bid was to be opened in December but was delayed on the request of the bidders due to global recession. The bid was opened earlier this week. Lanco again emerged as the lowest bidder by quoting Rs 3.09 per unit followed by JP with Rs 3.10 and Reliance Rs 3.12 per unit.

The 1,320-MW coal-based Karchana thermal power project in Allahabad has already been awarded by the BSP government to the JP group, which is also implementing the Rs 40,000-crore Ganga Expressway, the dream project of Chief Minister Mayawati, and also the Taj expressway project on the left bank of the river Yamuna from NOIDA to Agra.

The joint action committee of the power employees unions has condemned the government move to award the project to a private bidder. “It’s a loot of the people’s money as the project was not given when the bid was as low as 2.24 per unit and now the same project has been awarded at the rate of Rs 3.02 per unit,” said Shailendra Dube, convener of the committee.