CHANDIGARH: The 15 months delay in commissioning of 500 MW Lehra mohabbat stage II thermal projects by BHEL would put an additional financial burden of 500 crores on the Punjab State Electricity Board(PSEB) besides the cost of additional power purchases to the tune of 1825 crores.

The  actual cost of  500 MW Lehra Stage II would cross 2200 crores against  the  originally estimated t cost of 1679 crores when the contract was awarded  to BHEL .The delay of 15 months had put an further additional burden of 250 crores by way of higher rate of interest on loan due to non completion of project in time.
The generation loss to PSEB on account of delay of 15 months for each for both  units would be 1695 crores  PSEB would be forced to buy costly power from the grid at market rates which would put an estimated financial burden of Rs 1825 Crores  on PSEB .
    
The PSEB Engineers’ Association in a memorandum to Chief Minister Punjab has pointed out huge time and cost over run at Lehra Mohabbat stage II works. The construction cost at Lehra Mohabbat would be 4.4 crores per mega watt where as in Haryana the 600 MW Yamunanagar project would cost 4 crores per megawatt.
The 600 MW Yamunanagar thermal station of Haryana Power Generation Corporation has overtaken the PSEB’s Lehra Stage-2, 500 MW, and is racing ahead for an early commissioning while the time delays at Lehra are progressively increasing.     

The start of boiler construction of the first 300 MW units at Yamunanagar was 20th March 2006 as against 15 March 2005 for first unit of Lehra Stage II. The first unit at Yamunanagar is expected to be “synchronized” on 25-11-2007 despite a delay of one year while the Lehra unit, having started 1 year earlier is expected to be commissioned only in Feb 08.     The work of Yamunanagar plant awarded to Reliance which is getting the equipment from china while PSEB awarded the contract to BHEL on turnkey basis         
    
In the Memorandum PSEB Engineers’ Association has complained to Chief Minister Punjab that BHEL has failed to attend major discrepancies pointed out by PSEB during the course of construction at Lehra. Highlighting the financial loss, PSEB Engineers’ Association had started that for the construction Lehra project PSEB had obtained soft loans at confessional rates at 3 % lower rate of interest on the condition that the project would be commissioned by 31-3-2007. The further condition of loan was that in case the project slips e. after 1-4-2007 the normal (full) rate of interest which is 3% higher would be charged. Since the 1st unit of Lehra was slipped from Dec 2006 to Feb 08 and 2nd unit from March 2007 to June 2008, PSEB would be paying an extra Rs 250 Cr on account of higher interest on Loan. Further, due to delayed commissioning the Interest during Construction would increase by about Rs 100 CR.
    
The PSEB Engineers’ Association has further pointed out that besides the delay in commissioning there is absolutely no “quality control” at the Lehra Plant, contracts have been a awarded to “vendors” not having the requisite experience. 
    
To cite just one example of poor working of BHEL, recently the “neck welding” of main steam line from Low pressure Turbine  to condenser was checked by PSEB, and found 100% failures  which the association  claimed unheard of and unprecedented.
    
PSEB Engineers association in the memorandum to Chief Minister Punjab has given a damning list of major discrepancies that BHEL has failed to address and a list of “Sub-contracts” awarded to incapable vendors. In case of Turbine the BEHL awarded work of construction to UBEL which further sub constructed it to a Bathinda firm which abandoned the work half way in June 2007 there by derailing the progress of work and delaying the work further. Similarly for Boiler, BHEL is not during the construction work itself but has contracted it to a Bathinda firm.
         
A senior PSEB official said on condition of anonymity that BHEL had earlier executed the stage I works at Lehra Mohabbat and was well versed with all the conditions of the work and there should be no reason for delay. However, BHEL which is already “over-booked” is not in a position to execute on time the various project awarded across the country- and this seems the one of the reasons for the complacency and delay at Lehra.