CONTRACT SERVICES

04/22/12

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PROCESS ADOPTED FOR FINALISATION OF DOCUMENTS • • WPP of NTPC was being followed Need felt for updating to suit Transmission Sector requirements, based on experience gained over the years POWERGRID WPPP finalised
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04/22/12

04/22/12

Process For Document Finalisation…. • Services of Consultant taken • Wide consultations were under-taken within POWERGRID • A no. of drafts were prepared and comments were sought from all concerned • Final draft was placed on

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Process For Document Finalisation…. • Copy of document circulated to funding agencies (World Bank, ADB etc) , Ministry, CVC, CAG etc Comments received were deliberated and suitably incorporated
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04/22/12

II(Post Award) 5 .The WPPP is organised into two Vols Volume –I (Pre award) 04/22/12 Volume.

3 Benchmarking of time schedules for various activities. 4 Providing Methodology/ Guidelines to deal with real issues/ situations.WPPP is aimed at : 1 Transparency and consistency in decision making 2 Mapping of roles & responsibilities of different departments. Covering entire gamut of Activities from conception of the Project to Completion 04/22/12 6 .

has been given in the document itself. 04/22/12 7 . the procedure for modification/ addition in WPPP.Review of WPPP envisaged after one year of implementation Further. which may be necessissated based on experience or other reasons.

Vol –I (Pre-Award) Covers          04/22/12 Project Conception and approval Internal Zero Date Package list -Corporate / Site MNW Finalisation of Cost Estimate Qualification Requirement of Bidders Selection of Bidding Process Finalisation of Bidding Documents Calling of Tenders 8 .

.Vol –I Covers Contd……. Bid Receipt and Opening Evaluation of Bids Post Bid Discussions Award of Contract Various Pre-award Issues 04/22/12 10 11 12 13 AND 9 .

Salient Points of Vol –I Standardisation of :    Package list Qualification requirement Bidding Documents Approvals at higher level required only in case of deviation from standard - 04/22/12 10 .

POWERGRID has limited experience. specialised in nature.Salient Points of Vol –I …. Specifies decision methodology for selecting Bidding Process and mode of calling tenders. eg Two Stage Bidding for Packages which are: Technically Complex. Specs fast changing (Price bids from Bidders conforming to an acceptable common technical standards & other conditions/ QR) 04/22/12 11 .

Salient Points of Vol –I ….. Spells out evaluation methodology in details including that for   Arithmetic corrections Cost compensation for commercial/ technical deviations Seeking post bid clarifications When to carry out negotiations   04/22/12 12 .

taking care of financial implications 04/22/12 13 ..Salient Points of Vol –I …. Specifies Methodology to deal with change in sub-vendors. if requested by recommended bidder during post bid discussions.

 Defines Applicability of WPPP . monitored through MNW Pre-Award actions and advance Expenditure on New Projects prior to approval . after bid opening. to be summarily rejected 14    04/22/12 .to avoid delay Late Bid..not applicable in case of Restoration Works All activities to commence from Internal Zero Date.Salient Points of Vol –I ….

Salient Points of Vol –I …. No negotiation upto a variation of (+ve) 10% 04/22/12 15 . during bidding methodology to deal with is spelt out –   Bid Evaluation – Comparison with estimate on overall basis.  Single response against Open Tender – to be treated as Open Tender Change in BOQ..

to be included in bid price Octroi / Entry Tax – reimbursable on bought-out items also Separate procedure for procurement of software solutions 16 04/22/12 ..Salient Points of Vol –I ….  Owner supplied materials in case of site packages .deduction from RA bill allowed site     Works Contract Tax .BG done away with CPG / Security Deposit for packages .

Drawing approval and Type Testing Sub-vendor/Sub-Contractor’s approval Inspection and Despatch Clearance 04/22/12 17 .VOLUME II.POST AWARD AREAS COVERED Contract Signing Arranging CPG Release of Initial Advance (Supply) Finalisation of L2 Network Detailed Engineering.

VOLUME II.POST AWARD AREAS COVERED….contd 04/22/12 Project Monitoring Opening of LC. Processing of Bills and Release of Payment Technical Approval for variations Administrative approval for issue of amendment Time Extension and Liquidated Damages Commissioning and Taking Over Revised Cost Estimate Dispute Resolution and 18 ..

POST AWARD (IMPORTANT AREAS) Time Extension And Liquidated Damage Guidelines for decision making • No LD to be imposed if net delay is not attributable to the Contractor • Token LD to be levied if net delay is attributable to Contractor & Loss not suffered by POWERGRID • Methodology for calculating 19 04/22/12 .VOLUME II.

POST AWARD LD(Contd) Methodology to find out delay attributable to the Contractor Total Delay= A Delay due to force majeure =B Delay attributable to POWERGRID =C Concurrent period in B & C = X Net period of delay on account of Force Majeure and POWERGRID= B+C-X Net period of delay on account 04/22/12 20 .VOLUME II.

POST AWARD LD(Contd) Loss. if any.VOLUME II. suffered by POWERGRID viz. • Extra payment to other contractor • Extra payment to other agencies • Compensation to generating company towards deemed generation • Delay in return on investment • Exchange rate fluctuation in a foreign currency contract. 21 wherever applicable 04/22/12 .

VOLUME II.POST AWARD LD(Contd) Methodology to work out LD Amount if the delay is attributable to contractor and loss suffered by POWERGRID Loss > Full LD Amount as per contract Leviable LD= Full LD Loss < Full LD Amount as per contract Leviable LD= Loss+ Token LD subject to 22 04/22/12 .

if23 04/22/12 .VOLUME II. payment to the contractor shall continue in case of Corporate packages without deduction on this account on the consideration that the retention amount and BGs (against retention etc) are available.POST AWARD LD(Contd) Pending finalisation of LD. However deductions towards LD from progressive payment can be made only after approval of ED(Region).

acting as co-ordinator. after ascertaining receipt of all certificates All activities except release of CPG/SD of Contract closing to be24 . To be issued by not less than Manager A Contract to be treated as closed on Release of CPG/SD on successful completion of warranty period and on Issuance of CCP-13 Closing of a Contract to be formally declared by the concerned Contracts Deptt.VOLUME II.POST AWARD CONTRACT CLOSING 04/22/12 Monitoring for Contract closing to commence on completion of 8090% of scope Contract Closing Certificates 13 in number..

CPG to be reduced to 50% on taking over Quarterly review of status by ED(region) in respect of all critical BGs on the basis of MIS prepared by PESM 25 .POST AWARD CUSTODY AND RELEASE OF BGs 04/22/12 Finance to be custodian Streamlined procedure for monitoring all BGs Advance BG will be released on adjustment of full advance.VOLUME II.

PV as per actuals 26 .POST AWARD 04/22/12 ADVANCEMENT OF SUPPLIES Advancement of supplies may be on account of the following .VOLUME II. Once advancement allowed.Requirement from POWERGRID .For timely completion of POWERGRID’s project Advancement to be normally allowed except for fund/storage constraints as it is positive step No approval required for advancement upto 30 days.

01% of Contract price for every 1% reduction 27 .VOLUME II. Payment at unit rates upto quantities originally provided in the contract …….15% of contract price No limit for individual items If overall contract price exceed 15% ….unit rate for the quantities executed beyond (+15%) to be negotiated and finalised A token compensation @ 0.POST AWARD QUANTITY VARIATION PROVISIONS (CONTD…) Revised Procedure 04/22/12 Uniform Quantity Variation Provisions in all types of contract Overall limit of +/.

CPG Value. CPG value. LD amount. Advance amount. advance amount resulting in ‘simplified’ contract 28 .VOLUME II. Contract price as originally awarded Amendment to Contract Price will not affect LD amount.POST AWARD 04/22/12 Reference Contract Price For different purposes such as Quantity Variation.

04/22/12 29 .VOLUME II.POST AWARD TURNKEY CONTRACT AND LUMPSUM PRICE Lumpsum price of items to remain unchanged irrespective of quantities actually executed Unless scope change is effected by POWERGRID.

04/22/12 30 .VOLUME II.POST AWARD Change of sub-vendor as per WP policy(volume I) to be followed during post award stage.

POST AWARD Acceptance of BG from a Bank other than specified in contract To be accepted in exceptional circumstances with the approval of ED (finance) 04/22/12 31 .VOLUME II.

VOLUME II. • On receipt of technical clearance / technical approval communication to be sent to contractor and all concerned with the quantum of work to be taken up by the contractor so that progress of work continues pending issue of 32 .POST AWARD 04/22/12 Procedure for taking up new work / quantum of work exceeding the contract item pending Contract Amendment • Any new work / quantum of work exceeding the contract item shall be taken up only after technical clearance / technical approval.

VOLUME II.POST AWARD PROJECT MANAGER For a more coordinated approach in major/important/ specialized projects Normally at a level of AGM & above 04/22/12 33 .

ED(CS). ED(Region) headed by 34 .VOLUME II. ED(Engg/LD&C/Telecom). at least one attempt shall be made for amicable settlement by a standing committee as follows. for Corporate awarded packages : ED(Fin).POST AWARD 04/22/12 ARBITRATION / DRP Normally Arbitration / DRP shall be avoided to the extent possible Prior to reference of a dispute by contractor to Arbitration / DRP.

VOLUME II. Thereafter the same can be destroyed if not under examination / scrutiny by any investigating authorities) 04/22/12 35 .POST AWARD Retention of documents All documents pertaining to award and implementation against a contract shall be retained for a period of eight financial years after the closing of the contract.

using the experience gained over the years and. procedures hitherto followed for contract administration and reengineers the processess. provides benchmark time schedules for different activities 36 04/22/12 .Thus the WPP formalises and consolidates the policies.

DOP for O&M 04/22/12 37 .Delegation of Powers  Contents : .Delegation by Board to CMD .DOP for construction stage of approved projects .

Delegation of Powers  Contents - (Contd): DOP for Personnel Powers in CC DOP for Admin Powers in CC DOP for P&A powers in Regions DOP for Consultancy DOP for Bond Cell 04/22/12 38 .

rules and regulations and instructions on system and procedure “ Full Powers” not to exceed powers of CMD 04/22/12 39 .Delegation of Powers  Salient - - Points Concurrence by Finance necessary unless otherwise specified Subject to observance of relevant policy guidelines.

e. 10 Cr. beyond 20 Cr. authorised to exercise all or any power rested in Board except as in Annexure-A of DOP .Award of Contracts upto Rs. By Sub-committee.By Exception i.. By Board 04/22/12 40 .Delegation of Powers  Powers of CMD . 10 to 20 Cr.

which is more than 10% for any component part of project.Feasibility Reports. . Projects Reports and Estimates etc. 04/22/12 41 .Delegation of Powers  Powers excluded from Delegation to CMD .Any deviation in estimate approved by Board/ GoI. costing more than 5 Cr.

.Write off of stores. plant and machinery more resulting in net loss of more than 10 lakhs 04/22/12 42 .) .Consultancy Contracts beyond 50 lakh as against 10 Cr.Delegation of Powers  Powers excluded from Delegation to CMD (contd. For others .

Delegation of Powers  Canons - of Financial Propriety Expenditure should not be prima facie more than occasion Demands Same vigilance to be exercised as of own money Allowances not to be source of profit Subject to approved budget 04/22/12 43 .

Delegation of Powers  Powers of Executives (some examples) (Construction Stage) .Technical & Administrative approval of Cost Estimates ED upto 500 lakhs Manager upto 10 lakhs 04/22/12 44 .

Delegation of Powers  Approval tender) of Award of Contracts (open ED upto 500 lakhs GM upto 150 lakhs Dy Manager upto 5 lakhs 04/22/12 45 .

Thank You 04/22/12 46 .

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