Currently, Power Grid holds 30 per cent equity stake in PTC followed by NTPC and Power Finance Corporation (PFC) holding 15 per cent each. It is the remaining 40 per cent equity which is being offered to UTI, LIC and IDFC. Negotiations between the FIs and PowerGrid over equity stakes have already begun.

According to the chairman designate, PTC, who is also the director, projects, Powergrid, R K Madan, PTC will start commercial operations after its registration next month.

Madan informed that the promoters agreement was signed between PowerGrid, NTPC and PFC last week and the new company is expected to be registered by the first week of May.

PTC with an authorised capital of Rs 150 crore, would initially startwith a equity of Rs five crore out of which PowerGrid would pump in Rs 1.5 crore as its share in the new company.

Madan said the setting up of the PTC would enable mega projects of leading IPPs to negotiate with one buyer only and would help alleviate the difficulties of IPPs for negotiating PPAs with the states. PTC's operations would also include handling surplus power from sources other than mega projects.

However, Madan said, PTC will supply power to only those state electricity boards (SEBs) who have gone into reforms and especially those which are setting up state electricity regulatory commissions (SERCs).

"Once business picks up, trading will increase and there could be generation of business anywhere between Rs 1,000 crore to Rs 5,000 crore", Madan added.

In addition to this PTC is also in the process of finalising financial consultants, who will advise the new company on issues relating to raising and investing of resources. Besides devising a security package, the consultants would alsowork out a draft tripartite agreement to be signed between th1e PTC, state governments and the Reserve Bank of India.

ICICI Securities and SBI Caps have already been shortlisted, and one of them will be finalised by end May.

Giving details about the response to the mega power projects offered for private sector participation, Madan said that there has been a overwhelming response for the 1500 mw Cudalore power project in Tamil Nadu from 29 potential bidders in the first round, out of which Powergrid shall shortlist 10 by April 29.

Besides Cuddalore, the process of pre-qualification and shortlisting of potential bidders for the 2000 mw Pipavav power project in Gujarat has also started.

In response to the notification for pre-qualification, 27 firms have registered their interest by way of purchase of pre-qualification documents.

Madan said that Powergrid will also set up multi-site projects in the West coast with an aim to enhance developers and promoters. The projects will use LNG as afuel.

Power majors make a beeline for 2000mw Pipavav project
Leading power majors including Daewoo, Enron, Alstom Energy, L&T, PSEG, ABB, Total, CLP Power, Texaco, GVK, Reliance, Ashok Leyland, BHEL, Power Gen, Siemens, British Gas, Shell, EDF, CEPA are in the race for the 2000 mw Pipavav mega power project in Gujarat.

As many as power companies have purchased the pre-bid documents for Pipavav and about 29 companies have bought documents for Cuddalore in Tamil Nadu. Out of 27 companies for Pipavav, 13 are the ones which have also bought bid documents for Cuddalore.

At a recent meeting between Power Grid and the bidders for the Cuddalore project, it was decided that as against the earlier decision of shortlisting only 5 parties, ten parties would be qualified in the first round.

In addition to this, it was also decided that the guidelines for marking system to be adopted by Power Grid for shortlisting successful candidates would be made open to all the bidders.

Officials said that thisdecision was taken with the consent of the international consultants appointed for advising on the setting up of the mega power projects.

The international consultants include Dresdner Kleinwart Benson, Lehmeyer and Feshfields, who are working out the financial technical and legal details related with the setting up of mega power projects.