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Post Award – Activities > Post Award – Issues >. POST AWARD Activities. Post Award Activities. Contract signing CPG Submission Release of Initial Advance (Supply) Finalization of L2 Network Detailed Engineering , Drawing Approval & Type Testing Sub-vendor / Sub-Contractor’s Approval
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Post Award Activities • Contract signing • CPG Submission • Release of Initial Advance (Supply) • Finalization of L2 Network • Detailed Engineering , Drawing Approval & Type Testing • Sub-vendor / Sub-Contractor’s Approval • Quality Plan Approval
Post Award Activities • Inspection and Despatch Clearance • Physical Execution of Work at Site • Project Monitoring • Opening of LC, Processing of Bills and Release of Payment • Technical Approval of Quantity Variation including New Items • Amendment(s) to the contract • Time Extension and Liquidated Damages
Post Award Activities • Contract signing • The formal contract agreement to be signed between POWERGRID and Contractor in two original copies appending other documents like GCC, Tech.Spec and SCC .
Post Award Activities • CPG Submission • To submit to Corporate Contracts for Corp. Packages and Regional Contracts for Site Packages. • CPG to be scrutinized by CC Contracts and sent to Corp.Fin for verification with bank. • Accepted CPG to be forwarded to Regional Finance under intimation to CC Contracts.
Post Award Activities Release of Initial Advance (Supply) • For release of initial advance, the following formalities to be completed : • Unconditional Acknowledgement of LOA. • Submission of CPG and Invoice • Submission of BG for equivalent amount • Finalization of L2 Network.
Post Award Activities Finalization of L2 Network • Responsibility: CMG for CC Packages. • :Reg.PMD for Site Packages • The L2 Network will cover finalization of sub-vendor, quality plan, Engineering activities, Inspection, Manufacturing and supply, civil, erection, testing & commi-ssioning. • Revision in quantities in L2 Network with the approval of ED Region.
Post Award Activities • Detailed Engineering , Drawing Approval & Type Testing • The detailed Engineering activities shall be : Drawing approval, approval of design calculations and receipt of other technical details, witness & approval of type test.
Post Award Activities • Sub-vendor / Sub-Contractor’s Approval • Responsibility : Corp.QA&I for non-QR supply items of Corp.Packages. • Regional Engg / FQA for supply items of site packages. • Sub-contractor proposed by the main contractor for erection / civil portion of Corp.Packages shall be finalized by Region after verifying sub-contractor’s qualification / experience.
Post Award Activities • Quality Plan Approval • Responsibility : Corp.QA&I. • The manufacturing quality plan for a particular equipment / material is generally valid for a period of three years.
Post Award Activities • Inspection and Despatch Clearance • CIP : It is clearance of stage inspection either accepting or rejecting the material. • MICC : issued for billable items as per LOA.
Post Award Activities Physical Execution of Work at Site • L3 Network shall be developed at site for monitoring of day-to-day activities. • Execution site to ensure that only material cleared under category-A CIP is cleared for erection.
Post Award Activities Project Monitoring • Monthly progress reports to be submitted by PMD to ED/Region highlighting the progress of the following activities : • Engg. activities • Sub-vendor approval • Inspection status • Supply status • Site activities • Payment status • Budgetary targets • Status of BGs and Contract Closing
Post Award Activities • Opening of LC, Processing of Bills and Release of Payment • Responsibility :- • Concerned Site & Regional Finance for Corporate Packages. • Concerned Execution site & local Finance for Regional Packages. • LCs to be opened for a quarter on revolving basis. • LC charges to be borne by the Contractor. • Payments in foreign currency : to be made by IF Section/CC.
Post Award Activities • Technical Approval of Quantity Variation including New Items. • Corp.Engg.for corporate packages and Regional Engg.for Regional packages. • Variation may be due to change in quantities as per site requirement or change in scope of work. • All such variations to be processed in two stages – 1st technical approval; 2nd administrative approval for issue of change of order. • Once construction drawings are issued to site, technical approval is deemed to have been accorded.
Post Award Activities • Amendment(s) to the contract • Regional Contracts for Corp.Packages and Regional/Site Contracts for site packages. • On receipt of technical approval, administrative approval to be taken for issue of change order as per DOP. • All Amendments to be signed by not below Manager.
Post Award Activities • Time Extension and Liquidated Damages • The delay in the performance of contract may be on account of (a) Reasons attributable to the owner (b) Reasons due to force majeure conditions (c) Reasons attributable to contractor. • Liquidated Damages is to recover any loss and not a penalty.
Post Award Activities • Completion, Testing, Commissioning and Taking over. • Revised Cost Estimate • Dispute Resolution and Arbitration • Contract Closing
Important Post Award – Issues-1 • Correspondence Desc • Record of Bank Guarantees Desc • Release of Payment – Pending contract amendment Desc • Advancement of Supplies Desc • Performance Certificate to contractors Desc • Issue of Project Authority Certificate Desc
Important Post Award – Issues - 2 • Insurance Desc • Checking of Conductor Length – in respect of consignment received in Transmission Line Stores Desc • POWERGRID’s overhead charges Desc • Completion, Commissioning, Taking Over and release of last payment Desc
Important Post Award – Issues - 3 • Communication with GOI / MOP/ Funding Agencies etc., Desc • Reference to / Clarification Desc • Documents/Files concerning post – award contract execution Desc • Cancellation of Contract Desc • Negative Price Variation Desc • Payment Terms – Advance Payment Desc
Important Post Award – Issues - 4 • Change of Name • Quantity Variation Provisions Desc • Reference Contract Price Desc • Packages Involving More than One Region Desc • Turnkey Contract Desc • Project Manager Desc • Tree Compensation Desc • Audit Co-ordination Desc • Discrepancies in Documents Desc
Important Post Award – Issues - 5 • Retention Period of Contract Documents Desc • Taxes and Duties Desc • Miscellaneous Desc
Correspondence • As per Contract to be followed • Each and every communication received from the contractor that requires response is to be replied promptly • Communication not to include any commitment/liability beyond contractual provision without approval of competant authority • LOA reference and name of the contract to be mentioned • Commercial aspects / issues raised to be prompty and expediously settled. BACK
Records of BGs • Custodian - Finance Department. To maintain proper records • Finance to release status of BGs once in every quarter to trigger off action by all concerned for extention/encashment / release. • Action to be taken at least one month in advance
Records of BGs • If No response from any department, finance to take action on its own for validity extention along with conditional claim. • Approving authority CC Packages – Extension /ED ( Region )
Records of BGs Advance BG • Validity upto 90 days after scheduled TOC. • To be reduced on half yearly basis • Extension is not required after adjustment of total advance. • BG to be released within three months after adjustment of advance. • Proposal for reduction / release to be initiated by Regional / Site Finance. • Incase of extension, the Department seeking extension to put up proposal and ED(Region) to approve.
Records of BGs Contract Performance Guarantee • C.P.G. to be reduced to half after issue of TOC • Execution site to send the proposal along with contractor’s request. • CC packages – AGM/GM to approve Site packages – DGM to approve • Due to considerable recovery if reduction is not possible to obtain approval of ED(Region) for CC packages and AGM/GM for site packages. • Release immediately after warranty period. • All efforts to be made to complete all contract closing formalities before warranty / defect liability period. • If any formalities pending and contractor is not responsible, CPG to be released with approval of ED or AGM/DGM. • The above is only for cases where the formalities takes more than three months after warranty period.
Records of BGs B.G. against final payment / progressive payment • For retention of any BG beyond stipulated period requires approval of ED(Region) / GM or AGM as the case may be. BACK
Tree Compensation • Approval for estimate to be taken before releasing the payment. • Revise if it is expected to exceed the original approval. • Proper record to be maintained. • All trees are to be removed including the saplings. • While handing over the line to O&M, certificate stating that all the trees and saplings are removed and the compensation has already been paid. BACK
Release of payment pending contract amendment To avoid impediment to progress. • After technical approval for the quantities exceeding LOA – pay 90% • Pending approval for new items – pay 75% • Communication to the contractor to go ahead with the works pending issue of amendment. • Action to be taken for early issue of amendment. BACK
Advancement of supplies POWERGRID requirements: • Transfer / diverting of material from one project to other due to urgent requirement. • Initial delay in award for supply contract. • For completion of project ahead of schedule • Obtain approval of Regional Head. • Pay PV at actuals
Advancement of supplies Contractor’s requirement: • To take care POWERGRID interest also. • Disruption due to force majeure conditions like labour problem, riotous condition in the area of production. • Transporters strike. • Any other reason. • Allowed by considering availability of funds, storage space etc. • Approving authority – Director (Projects) • 30 days of advancement alone without any approval. • Warranty as per original contract. BACK
Performance Certificate • Only for completed works: • To be issued for CC packages – CS • To be issued for site packages – Site C&M • Obtain details from site • Issue in prescribed format after approval ED(CS) / ED(Region) as the case may be. • To be issued only to lead partner with copies to other partners. • Partners wise portion can be indicated separately. BACK
Issue of PAC and EDEC • As per exim policy to be issued by region, ED(Region) to issue. • Import content limited to LOA. Price variation can also be considered. • Contractor to make request to CC(CS) to finalise draft PAC and send to region. • Excise Duty Exemption Certificate – Same Procedure to be followed BACK
Insurance • Transit / Marine Insurance for supply of material for supply / supply cum erection / turnkey contracts. • Storage cum erection / installation for supply cum erection / turnkey contracts. • Transit insurance to be valid upto 60 days of receipt of material at stores. • Storage cum erection insurance for owners as well as contractors supplied materials. • Reimbursement limited to owner’s material.
To ensure adequate coverage • For imported material – 165% of CIF value + PV at 10% p.a. on CIF Cost (Maximum of 30% or Limited to as per contract) • Domestic supplies – FOR destination value + ED + ST + other levies + PV i.e. 130% of FOR destination price. • If any adjustment is required for PV, the same is to be taken care of.
Valid upto 20% extra time over the schedule period to avoid extension. • Additional validity if delay is expected in the beginning itself. • Competitive bids to be taken by the contractor. • For Turnkey, supply cum erection, erection contracts – the same methodology to be adopted for insured value for material supplied by the contractor. • To avail discount composite policy to be taken. • If delay in supply of OSM, contractor who can take policy for his supplies with approval of GM / AGM. • Policy in the name of POWERGRID • Pending claim, the agency to make good the material lost including OSM • If policy extended due to fault of contractor, the extra liability to be recovered under LD. BACK
Checking conductor length • Supplier to follow the procedure. • Contractor to weigh 20% of drums – expenses will be borne by the owner • Any shortage to be brought to the notice of supplier within 45 days to take action for lodging claim / to take necessary action. • TOC to be released against undertaking. BACK
POWERGRID OVERHEAD CHARGES • POWERGRID supplied material / equipments when contractor fails/having constraints • Material to be supplied subjected to availability. • Recovery as per norms. BACK
Black listing / Banning Business • Forgery of fraudulent practices including misrepresentation of facts. • Willful indulgence in supply of substandard material whether or not pre-despatch inspection carried out or not. • Repeated failure in fulfilling contractual obligation willfully. • Established litigant nature of the contractor to derive undue benefit. • Proposal to be initiated from concerned department / region. • Clearance by ED(CS)/ED(OS)/ED(Region)/ ED(QA&I)/ED(ENGG). • To be vetted by law and approved by CMD. • Showcause notice to be issued. • Approval from funding agencies wherever required. BACK
Completion, Commissioning and takingover Completed but could not be commissioned - No source of supply, bays are not ready. • Possible to commission within 4 months. • Final payment to be released after commissioning and CPG to be extended accordingly. Commissioning not possible within 4 months • To release balance payment due as per contract. • BG to be furnished for the final payment. • Initially valid for 12 months or 3 months after expected date of commissioning (if it can be anticipated) • Request from contractor and approval by ED(Region) If the commissioning is not possible within validity period of BG. BG to be extended upto a period of 3 years from the date of readiness. • CPG to be extended 1 year beyond the validity of BG i.e. upto 4 years. • TOC only after commissioning in line with the above.
Where system cannot be commissioned within a period of 3 years and reason not attributable to the contractor. • Take over the system with the approval of CMD. • BG for the final payment to be after TOC. • The CPG to be valid for a period of one year from the date of taking over. • Reimbursement of the additional charges incurred by the contractor. • (a) BG charges • (b) CPG charges for extended period • (c) Insurance charges • Obtain approval of ED(reg)
Till taking over, the agency will be the custodian of the project. • To make arrangement for watch and ward • Mobilize team for commissioning as and when required.
In cases where system commissioning is possible at reduced parameters: • In case of commissioning of the system possible within a year, the commissioning of the system at reduced voltage need not be considered. • If system demands for commissioning, the same may be resorted to with approval of Director(Proj). • In case commissioning of the asset not possible within one year, commission at reduced voltage with approval of Director (Proj). • Release the final payment against BG. To be extended upto two years after commissioning at reduced voltage. • CPG to be extended beyond one year of BG validity. • TOC to be issued. • BG charges etc. are to be reimbursed as stated earlier against documentary evidence with the approval of ED(REG). • Till system is taken over, contractor to provide watch and ward. Mobilize team for commissioning when it is required. If commissioning of the link or sub-station possible through other links at specified parameters, the system will be accepted as commissioned. • Any other case to be dealt separately.
Other issues. • Pending commissioning, other contract closing formalities to be concluded. • Advance BG linked to TOC to be released after system is made ready and entire advance is adjusted. • Till the above become part of the contract, this can be utilized as guidelines for ongoing works. • Fore closure of contractor with the approval of CMD. BACK
Communication with GOI / MOP / Funding Agencies • Corporate Planning will coordinate. BACK
Reference to / Clarifications • Avoid unnecessary reference to other departments/offices, specially in routine matters for which the powers are delegated in DOP. • Concerned should study the contract documents and take decision in their areas of responsibility. • Deal effectively with the contractor and safeguard the interest of POWERGRID. • Inadequate understanding shall not be accepted as ground for reference. • Genuine contradiction/shortcoming in terms and conditions in various documents. The concerned responsibility centre will promptly attend to even though the region is responsible for post award. • CC packages, relevant portions of the bid to be made available to region by CC/CS if required for sorting out any issue. BACK