Energy Efficiency Services Ltd cancels smart meters order to Chinese firm

State-run Energy Efficiency Services Ltd (EESL) has cancelled Rs 500 crore contract placed on a China-backed PT Hexing as it failed to comply with the local content norms. EESL will conduct fresh bidding for about 30 lakh smart meters in which, Indonesia-based PT Hexing that is backed by a Chinese firm, and other foreign firms will have to seek approval from the Department for Promotion of Industry and Internal Trade (DPIIT), as per the latest public procurement norms to participate in the tenders.

EESL managing director Saurabh Kumar said the cancellation of the contract has “nothing to do with the origin of investment. They failed in the terms of contract for domestic manufacturing.” EESL had not begun deployment of the initial batch of smart meters that arrived from PT Hexing. The tender for procurement of two million smart meters was won by PT Hexing under global bidding about two years ago. The Department for Promotion of Industry and Internal Trade (DPIIT) under the Ministry of Commerce and Industry on June 4 modified public procurement norms to give preference to companies whose goods and services have more than 50% local content. The revised order on public procurement classifies suppliers into class-I, II and non-local suppliers, based on which they will get preference in government purchases of goods and services.

ET Energy World
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