1.

0 Commercial Terms

1.1. The ownership of the turbine shall be on BOOT Basis - Build- Own -Operate and
Transfer. The bidder shall Design, Build, Finance, Own, Operate, Maintain a low-
pressure steam turbine generator of minimum 1.2 MW Net power (i.e. after
deducting auxiliary power from total power produced) capacity based on the
technical conditions specified above at the Sulphuric Acid plant of FACT Cochin
Division at Ambalamedu, Kerala and shall transfer the ownership of the turbine,
including all the accessories, after the end of 5 years. The bidder shall own, operate
and maintain the equipment during the first five years, after commissioning.

1.2. FACT shall be obliged to purchase the power generated by the bidder during the
BOOT- period (first 5 years) at a cost to be specified by the bidder.

1.3. FACT Guarantees to provide steam to operate the turbine for a minimum time of
70% days in an year, considering 24 hours of operation in a day (i.e. 365 days X
70% = 256 days = 256 X 24 hours = 6,132 hours per annum). This can go up to a
maximum of 330 days (7,920 hours) in an year, leaving about a total of 35 days for
annual turnaround (ATA) works and other stoppages of the Plant due to short-term
maintenance works.

1.4. Accordingly, the Annual Minimum Generation (AMG) considered for Commercial
conditions will be Guaranteed Capacity of the TG in kW (as per data obtained
through tests during commissioning time) multiplied by annual minimum time (i.e.
AMG = 6,132 X Guaranteed Capacity in kW). And, the Monthly Minimum
Generation (MMG), for commercial purpose, shall be considered as AMG/ 12 i.e.
8.33% of AMG.

1.5. The payment to the Contractor by FACT shall be based on MMG as calculated
above or actual generation as the case may be, subject to the conditions mentioned
below for deviation in quantity of generated electricity.

1.5.1. Normal Operation i.e. Actual monthly generation more than or equal to
Monthly Minimum Generation (MMG) [corresponding to annual CUF of
70%]

a. Payment will be made for the monthly generated electricity as per the quoted rate,
for generation in the range of 8.33% to 9.50% (corresponding to an annual CUF of
80%) of AMG.

b. The applicable rate will be half of quoted rate, for generation in excess of 9.50%
of AMG, as a measure to incentivize FACT for better utilisation of steam.

1.5.2. Shortfall in Generation i.e. Actual monthly generation less than Monthly
Minimum Generation (MMG)
 a. If the reasons for shortfall in generation are attributable to FACT, payment will be
made for MMG, calculated at 70% CUF as mentioned elsewhere.

b. If the reasons for shortfall in generation are attributable to the Contractor, the
payment will be limited to actual generation.

c. For generation as low as less than 20% of Monthly Minimum Generation (MMG),
irrespective of the reasons for shortfall, the quantity generated shall be consumed
by FACT without any charge payable to the Contractor. This shall be suitably
adjusted later, along with the bill for 12th month, based on correct assessment of
the reasons for shortfall.

d. The Contractor is obliged to produce power whenever steam is available at

specified conditions. If the turbo-generator is not operational for a period of more
than 15 days in an year (or equivalent hours) due to reasons attributable to
Contractor, FACT shall recover a penalty of ₹ 1 lakh per day, for downtime in
excess of 15 days.

1.6. Even though payments are made to the Contractor on monthly basis as explained
above, an annual electricity bill payable to the Contractor, after considering the
annual performance of the equipment, shall be prepared after the 12th month.
Minimum amount payable considering 70% CUF, rate reduction, if any owing to
better performance, penalty for shortfall etc. applicable shall be based on the annual
performance data. Any difference in amount so calculated for the year, shall be
paid/ recovered from/ to the Contractor, and shall be adjusted in the bill for 12th
month.

1.7. LT Power to be provided for auxiliary requirements by FACT shall be deducted

from the claim of the bidder. A wattmeter for measuring the same shall be installed
by FACT.

1.8. All relevant records related to generation of electricity, production log sheet etc.
shall be signed by both parties at the end of every month and copies shall be kept
for verification later. This shall form the reference for payment settlement in the
year end.

1.9. The Contractor shall hand over the ownership of turbo-generator system in its
entirety to FACT after the end of five years without any financial cost to FACT.
Any failure in turbine operation during this period of 5 years shall be the
responsibility of the bidder and shall be rectified at his cost. No payment shall be
made to the Contractor by FACT towards operation, maintenance etc. during this
period for whatsoever reasons.

1.10. No extension in operational period of five years shall be provided to the Contractor
in this regard.