U.P. power utility scraps tender in which Adani Group company was lowest bidder to supply smart meters

State-owned Madhyanchal Vidyut Vitran Nigam Limited abruptly cancelled the tender that included the Adani Group’s bid for the supply of around 7.5 million smart meters estimated at ₹5,400 crore

February 07, 2023 04:15 am | Updated 04:22 am IST - AHMEDABAD

Adani Corporate House at Shantigram outskirts of Ahmedabad. File.

Adani Corporate House at Shantigram outskirts of Ahmedabad. File. | Photo Credit: VIJAY SONEJI

In what’s possibly a major jolt to the Adani Group following the scathing Hindenburg report, in BJP-ruled Uttar Pradesh, a State utility scrapped a tender worth ₹5,400 crore for the supply of smart meters. The State-owned Madhyanchal Vidyut Vitran Nigam Limited (MVVNL) abruptly cancelled the Adani Group’s bid for the supply of around 7.5 million smart meters to the power distribution company or discom. According to sources, the Adani Group company, Adani Transmission Limited, had submitted the lowest bid, yet the discom cancelled the tender citing “unavoidable reasons”.

The MVVNL had invited the e-tender for the appointment of an Advanced Metering Infrastructure (AMI) service provider for smart prepaid metering in the areas under its jurisdiction. Adani Transmission Ltd. had quoted a price of ₹10,000 per smart meter, which was the lowest compared with other bidders, including L&T and GMR.  However, the price quoted by the lowest bidder (the Adani Group) is still considered steep because a cost of ₹6,000 per meter has been fixed under the standing billing guidelines of the Rural Electrification Corporation.

In a notification dated February 4, MVVNL said: “The tender has been cancelled due to unavoidable reasons.” No further statement has been forthcoming from the State authorities on the scrapping of the tender. There is no clarity on whether the decision to scrap the contract was taken at the bureaucratic level or if it was initiated by political bosses in Lucknow. 

“It’s a mystery who took the call and what prompted it,” a source said, adding the decision has been announced just a few days before a mega investment summit the Yogi Adityanath government is organising from February 10-12 in Lucknow to attract investments to Uttar Pradesh.  The ambitious event is modelled on the Vibrant Gujarat Summits launched during Prime Minister Narendra Modi’s tenure as Gujarat Chief Minister, and in the midst of a Parliament session in which Opposition parties are demanding the constitution of a Joint Parliamentary Committee (JPC) to probe significant allegations against Adani Group in the Hindenburg report. 

“There’s no clarity on whether it’s a political decision or simply a technical one taken at the bureaucratic level,” a source from Lucknow told The Hindu

In the run up to the investment summit, the U.P. Government held a roadshow and conference in Ahmedabad, in which U.P. Minister of Energy, and Urban Development, A.K. Sharma, a former Gujarat cadre bureaucrat and trusted aide of Prime Minister Narendra Modi, had one-to-one meetings with heads of corporate houses from Gujarat, including the industrialist at the centre of the storm, Gautam Adani in Ahmedabad on January 19.  Besides Mr Adani, the delegation met Sudhir Mehta of the Torrent Group, Parimal Nathwani of the Reliance Group, and others. Other members of the U.P. delegation included Mr. Yogi’s trusted bureaucrats, Navneet Sehgal and Awanish Awasthy. The latter continues serving as an advisor after his superannuation in 2022. 

Besides MVVNL, other discoms such as Dakshinanchal Vidyut Vitran Nigam Limited, Purvanchal Vidyut Vitran Nigam Limited and Paschimanchal Vidyut Vitran Nigam Limited, representing different regions in the State, had also floated tenders for the supply of more than 25 million smart meters with a combined bid value estimated at ₹25,000 crore. It is likely that the other discoms will also follow suit and cancel their tenders, sources said. 

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