NTDC, Discos: private firm accused of introducing inferior quality tap changer

National Transmission and Dispatch Company (NTDC) has accused one private company of manoeuvering to introduce Chinese tap changers in NTDC and Discos that have no proven track record.
Managing Director NTDC, Zia-ur-Rehman, in a letter to the Ministry of Water and Power, a copy of which has also been set to the Deputy Manager (legal), Public Procurement Regulatory Authority (PPRA), Muhammad Farooq, stated that there is no truth in alleging that a local agent caused Rs 9 billion loss to the national exchequer or influenced the procurement agencies to accept an inferior type of OLTC in power and auto-transformers. If one 220kV auto-transformer in the system is off for 10-days (minimum period to repair a faulty OLTC), NTDC will not be able to dispatch energy worth Rs 1 billion approximately, he added.
As per international studies, 60 percent to 70 percent failures of transformers are caused by OLTCs, which is why NTDC/Discos purchase power and auto-transformers fitted with high quality OLTCs from MR Germany/ABB etc with proven track-record for decades.
"Not only NTDC recommends the best quality OLTCs, but also world-wide all main utilities of Europe, Middle East, America, Iran, Australia, Africa etc purchase transformers fitted with OLTCs from MR Germany/ABB to ensure reliability of the system," MD, NTDC added.
According to him, for the last 2/3 years, a local agent, M/s 7AAs, is attempting to manoeuvre to introduce Huaming made Chinese OLTCs in the NTDC/Discos system which has no track-record nor was previously used in the system. He further stated that M/s 7AAs have started malicious litigation with NTDC at different fora including Competition Commission of Pakistan (CCP) , and also moved one Chief Minister on the same issue which is nowadays under hearing in Lahore High Court (LHC) and causing delay in opening of NTDC ADB tender.
As regards the Advisor Transparency International, Pakistan letter of October 22, 2013 mentioned alleging Rs 9 billion loss to the national exchequer, as referred to by Ministry and PPRA it would be sufficient to refer here to another letter of September 19, 2013 of the same agency, in which the agency appreciated the stand of NTDC for purchasing quality OLTC / equipment while highlighting that the NTDC failed to stop Iesco for importing inferior quality tap changer from Chinese company by M/s 7AAs who are defaulter in various supply orders of Iesco, Lesco and recently supplied poor quality aerial bundle cable to Hesco, Zia-ur-Rehman continues in his letter.
"How can a cartel be made by the purchaser when tenders are floated on ICB basis and all transformer manufacturers/suppliers are free to bid yet NTDC can not change its high risk-management decision," he further argued.
He added that all these purchases are made by observing PPRA Rules and Procurement guidelines of banks, ie ADB, World Bank etc which require evaluation of equipment on the basis of appropriate quality and whole life cost rather than lowest price.