bid process jammu
TRANSCRIPT
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National Training Programme For Rural
Electricity Distribution Franchisees
10-12 October,2011Venue: JKPDD,JAMMU
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Energy Division2
Bid-Process : NIT / RFP
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Energy Division3
Tendering Process and Commercial Arrangements
Notice Inviting Tender
Developing RFP
Elements of Contracts Agreement
Contents
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Energy Division4
Bid-Process : NIT / RFP
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Tendering Process and Commercial Arrangements
Selection of the franchisee should be done through competitive
route i.e. bidding route to ensure fairness of the transaction
The Tendering Process is initiated once the following prerequisitesare in place
Identifying the suitable franchisee model
Finalising Roles and Responsibilitiesof the Stakeholders
Scrutiny of the envisaged model among the Franchisers staff andtheir consensus-This is purely for the creation of a conducivesystem which go hand in hand with the Franchisee system
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Issue of Notice Inviting Tender
Defining the Franchisee Model
Defining the Roles and Responsibilities
of the Franchisee and Stakeholders
Technical and Financial bid evaluation
Franchisee
selection
Signing of Franchisee Agreement
and Bank Guarantee
Responsibility delegation and
Asset Transfer to the Franchisee
Letter of Award
Consensus by
Franchiser
Bid Submission
Pre-Bid conference -if required
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Notice Inviting Tender
Notice inviting Tender-Advertisement for calling EOIs or bids for
Franchising should cover the following information:
Objective in brief
Name of the area
Date of sale of tender document
Last date and time for sale of tender document
Last date and time of submission of bids
Cost of purchase of tender document
Address from where the tender document can be purchased
Earnest Money Deposit (EMD) amount with details regarding bank draft, etc.
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Developing RFP
Designing Bid Document- Covering all the details which needs to becommunicated to the interested parties like;
Information about the Project
Any legal provision under which the project is promoted
The selection criteria for the bid
Scope of work under the project
The baseline detail of the commercial information
Information for purchase of the document and its availability
Fee submission and the form in which it needs to be provided
Formats for the bids are required to be submitted
The due dates of the submission of the bids and the opening
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Energy Division9
Baseline Information
The most critical factor that shall enable the franhcisee to
bid realistically are the Commercial & Technical information.
The Level of information to be provided in the Bid documentdepends on the following factors:
Rural or Urban franchisee ?
Franchisee Model being envisaged ?
The size of the area selected for the franchiseeimplementation ?
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Energy Division10
Commercial Information
The Commercial Information should cover the
following (should be based on more than oneyear data):
Number of consumers
Connected load
Units billedAmount billed
Arrears
Payments made by the consumers
New connections/Disconnection
Energy supplied to the areaT&D losses
Annual average expenses in the area
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Energy Division11
Technical Information
The Technical Information should cover the following:
Number of Distribution Transformer installed/ damage record & theircapacities
HT/LT line length in the area
Energy consumption pattern
Supply schedule and breakdown history
Substation and their transformation capacities
Number of LT feeders and whether Rural/Urban
In case of any already running augmentation of other schemesplanned should also be informed through theBid Document
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Energy Division12
Eligibility Criteria
Bid Submission and Earnest Money Deposit
In the sequence and according to the processdesigned
Establishing the eligibility criteria
Franchiser needs to select the candidate based on the
already established criteria
These criteria depends on the following:Franchisee Model- Rural/Urban
Size of revenue billing and assessment
Consumer mix in the area to be franchisedSize of investments required over the term of contract period
Financial capacity to cater to the investment requirements
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Energy Division13
Objectives of the Agreement
Franchisee Agreement is a record that contains the details of rolesand responsibility. The agreement needs to be answer the following
questions clearly:
Whether contract protects the franchisee and the franchiser?
Are the rights and obligations of both parties clearly stated?
What is the legal framework within which both franchisee andfranchiser have to function?
Is the contract specific about the type and size of operation that thefranchisee is expected to manage?
Is the nature duration and extent of training to be imparted by thefranchiser outlined in the contract?
Whether the various payments to be made to the franchiser by thefranchisee have been specified?
Other fixed payments.
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Energy Division14
Objectives of the Agreement
Source of essential supply for proper O&M of the system.
If interrupted supply is provided by the utility, what are the arrangementsfor compensation to the franchisee?
Various MIS reports needed to be submitted to the franchiser by thefranchisee.
Duration of the franchisee contract and terms for renewal of the contract.
Area allocated to the franchisee for the intended franchisee operation.
Reasons for termination of the contract and its terms and conditions.
If there is any default in the contract, what are the measures that can bepermitted to rectify the situation?
Arbitration clause.
Whether franchisee is prevented from engaging itself in any other businessactivity for the duration of the contract?
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Energy Division15
Structure of an AgreementThe Agreement may be structures so as to cover the following details;
Information about the project and the area
Roles and responsibilities in detail of the parties
Liabilities and duties in case of Force Majeur
Contract period and Agreement validity
Technical boundaries need be defined
The agreed Bulk supply Tariffor incentive as the case may be and the provisionsof its revision
Responsibility shares in case of accidents and other commercial activities
Targets (if any) for the Franchisee/Franchiser at the end of the contract period
Termination of the agreement
This documents needs to be signed on every page by the parties and in presenceof witness from both parties
All of the above are subjective and may be changed according to the Model envisaged
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Energy Division16
Thank You