Form No: CPL/F/02

Planning & Budgeting CHECKLIST & GUIDELINES

Capital Planning SHEET: 1 of 11
TITLE: BU-PRG Recommendation Note REV NO: 05
DOC. NO: CPL/CHK/01 EFFECTIVE DATE: 16-09-21

SCHEME APPRAISAL REPORT

MAJOR CAPITAL BUDGET 2022-23
For review by BU-PRG in Meeting no. XX/2021-22, Dated: DD-MM-YYY

For Recommendation by BU-PRG

1.1 Business Unit and Location : Shared Services – Central Electrical Maintenance -
TATA STEEL MERAMANDALI
1.2 Scheme Description : Emergency power availability by installation &
commissioning of Black Start Diesel Generator
1.3 Nature of Investment : Sustenance

1.4 Estimated Cost (Rs Cr.) : 96 Cr. (Excluding GST)

1.5 Phasing of Expenditure : Project Cost (NGST Rs.

Financial Year
Cr)
FY23-24 0
FY24-25 36
FY25-26 60
1.6 IRR : N/A (There is no tangible returns)

1.7 NPV @ 10.10 % WACC (post : NA

tax)

1.8 Discounted Payback period : NA

1.9 Cost of Delay (EBITDA/month) : NA

1.10 Foreign Exchange : NA

1.11 Project Completion : 36 Months

1.12 Project Owner : Mr. Amit Agarwal

1.13 Project In-Charege : Mr. Harendra Pratap Singh

1.14 Manpower Impact : N/A

1.15 Shutdown Requirement : No Interconnection with the existing system during planned
shut-down
1.16 FEL1 Readiness :

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 Form No: CPL/F/02
Planning & Budgeting CHECKLIST & GUIDELINES
Capital Planning SHEET: 2 of 11
TITLE: BU-PRG Recommendation Note REV NO: 05
DOC. NO: CPL/CHK/01 EFFECTIVE DATE: 16-09-21

1. Background

At TSM, presently there are 165 x 2 + 150 x 2 + 33 x 1 + 77 x 1 + 20 x 1 + 12 x 1 MW of generating

sets (as mentioned in Table A) in the plant to meet the load requirements of the plant.
All these generator sets are directly or indirectly connected to the 220KV lines coming from the OPTCL
Grid.
At normal conditions, the generators run in synchronization with the grid. Excess and shortage of
generation is managed by export & import of power with grid respectively.
In certain conditions, due to faults at grid/in- house we are disconnected from the grid and even
complete black-out occurs (if islanding fails) – Details in Table B.
During such cases of complete black out conditions, we have to wait for restoration of OPTCL Grid
power to charge our station switchgears and then start our auxiliaries of boiler/TG Sets using that grid
power. After this in-house generation is availed.
Note – It cannot be obtained without OPTCL Supply because our in-house generation has failed & to
charge station switchgears, external supply is needed. Using the external (OPTCL Supply) we will run
our auxiliaries to light-up the plant again.

Inhouse Power Generation (Table A) :

Power House Number of Total Capacity

S.N. Capacity/Unit Major Customer
Name Units (MW)

SMS-1, Intake Pump House, BF

1 AEL 2 150 300
1&2 – 50%, CO 1&2 – 50%,
Caster – 50%, 1120TPD Oxygen,
2 AEL 1 165 165 Sinter 2&3 – 50%, Compressor
House – 50%, BOF – 50%

BF 2 – 50%, CO 1&2 – 50%,

3 BFPP 2 1 165 165 1200TPD Oxygen, Sinter 2&3 –
50%, BOF – 50%,

4 BFPP 1 1 20 20 Compressor House – 50%, BF 1

5 BFPP 1 1 12 12 – 50%

6 110MW PP 1 33 33
DRI Units
7 110MW PP 1 77 77

Total 776

Black Out Details (Table B):

S.N Black Out Details Duration for Grid Power restoration

1 11.03.2021 5

2 07.08.2021 8

3 02.12.2022 1

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Plant Power consumption load

S.N. Plant unit name Peak Power load Avg. power load Remarks

1 BFPP 2 145 MW 120 MW Maintained as per load

requirement of TSM
2 BFPP 1 16 MW 12 MW
3 AEL 270 MW 240 MW
3 110MW 100 MW 60 MW
4 Total TSM plant 531 MW 432 MW

Business Case and Essentiality

• At present there are 3 major power generating stations, namely – BFPP 1, 2 & AEL.

• Capacity of BFPP 1 is 20MW + 12MW, BFPP 2 is 165MW & Capacity of AEL is 150 + 150 +
165MW. (Details mentioned in Table A)

• This generation is sufficient enough to sustain the load of complete plant except HSM & CONARC
(as these are highly varying loads).

• Using the generation of AEL & BFPP1&2, base production of the plant can continue even if power
is disconnected from the OPTCL Grid.

• At black outs, we have to wait for OPTCL Grid power to charge our station switchgears through
which auxiliaries of boilers & TG are started and after this in-house generation of BFPP/AEL is
obtained.

Note: Auxiliaries means the motors of boilers, cooling water system, compressors. These help in
generating steam from boilers, circulation of cooling water for generators, supply of compressed
air for operation of valves. Collectively all help in generation of power from generators.

• In many cases, OPTCL Grid power takes a very long time for restoration due to major faults at the
OPTCL Grids/Transmission line. During this time, the boilers & furnaces gets cooled down and
after power restoration - cold start takes high time.

• This increases the startup time of our in house generation & steel plant production is highly
hampered.

• Example: Similar incident had earlier occurred on 11.03.2021, when Grid fault occurred & Islanding
system failed.
(On 11.03.2021, due to fault at grid end. 220kV Line 2 ‘Y’ & ‘B’ Phase Conductor at grid end got
snapped and it took about 5 Hours for its restoration. Even Line-1 was charged after 1.5 Hours.
Due to this delay, it took more than 12 hours to start full-fledged production of the plant) (Details
in Table B)

• Again, at blackout condition, if there is a fire incident in any of the site then it would be difficult to
extinguish the fire due to unavailability of power in pumps feeding water to fire hydrant lines.

• The water for fire extinction comes from the raw water pump house, which do not have any DG
Pumps or Emergency power supply.

• Also, as we have a contract demand of 90MVA - time taken to start up complete plant would be
delayed after grid power restoration. It is because, we have to slowly start up each plants keeping
in mind that power import does not exceed 90MVA.

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2. Evaluations of Alternative Options/ Option Analysis

Capex
Timeline
SN Alternative /Opex Advantages Disadvantages Remarks
(In months)
(Rs Cr)
Depends on the
severity of fault at
Waiting till 220KV Line &
No capital Plant production
1 grid power is Nil OPTCL or even
expenditure hampered
restored any internal
transmission line
fault
Alternative
No other
option as
alternati
proposed
2 ve N/A N/A N/A N/A
shall be
availabl
indicated
e.
here.

3. Proposal:
o As there are 3 major power generating stations – BFPP 1, 2 & AEL, as per study done by
TCE - it is proposed to install black start emergency diesel generator sets of capacity:
31.2MW (4 X 7.8MW) which will sustain the auxiliary loads of these power plants. Emergency
power to BFPP 1, 2 & AEL will be fed by 33KV tie-lines. (Dependency on 220KV Line during
black-outs will be eliminated).
o Now, instead of procurement of new DG Sets (whose cost will be around 200Cr., as given by
TCE in Nov.22), we plan to move existing HT DG Sets - 2 x 12MW from Sahibabad & 1 x
12MW DG Set from Khopoli to Meramandali works for the start up of BFPP 1, 2 & AEL.
▪ This combined 36MW Capacity will be sufficient for the startup of BFPP 1, 2 &
AEL.
▪ These DG Sets at Sahibabad & Khopoli are presently in idle condition & won’t be
running due to stringent environmental norms.
▪ By shifting the units from Sahibabad & Khopoli we will be utilizing the existing asset &
the black start purpose at Meramandali plant will also be solved.
Note: As there was no in-house generations in Sahibabad & Khopoli, the DGs were installed for
running of plant independently without the help of Govt. grid.
Presently due to stringent environmental norms, the DGs aren’t running there & is in idle state.
Power requirements of Sahibabad & Khopoli is met by import from Govt. grid or via power
wheeling from other Tata Steel generating units.
Note:
• Feasibility study of complete project is suggested. This will give us:
o More optimized cost estimation.
o Details/health condition & emissions regarding complete equipment.
4. Project Scope:

a. The project includes the following:

• DG’s health assessment & detailed engineering relating to its installation at the new site,
assessment of new equipment to be procured to replace the worn outs.
• Dismantling, loading, shifting/transportation & unloading of DG (Engine/Alternator) & other
auxiliaries.
• Civil related jobs for installation DG Sets.
• Installation & commissioning of DG Sets.

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 As per the assessment done after site visit at Sahibabad, the scope of work is broadly classified
in following 5 categories:

1. Equipment which can be directly shifted to the new site in Odisha.

2. Equipment which would require upgradation OR its faulty components must be
replaced after shifting.
3. Equipment which cannot be shifted & have to be newly procured.
4. Civil requirements at new site.
5. Additional services which are required to make the DG Sets operational at new site.

Each of this classification has following sub-works: Mentioned in Annexure A

Location of installation of DG: MRSS-2 existing 220KV AIS (which will be converted to GIS).

Digitalization/ Automation

• DG can be auto-started sensing the drop in grid’s voltage.

• Monitoring of DG Load & running parameters can be done.
• Existing LDC or MRSS-2 Switchgear room can be used as control room.

Safety

• Related safety standards to be followed for DG/Switchgears/Transformers.

• Compliance to SPCB norms will be done.

Operations

• Black out restoration SOP will be revised & same to be communicated to entire steel plant.
• Operation team to follow the recommended SOP for starting of boiler & turbine auxiliaries.
Impact on number of Control Room

• New control room to be set up for monitoring & operation of new proposed DG Sets.
• Provision for uninterrupted reliable communication with the DG Sets control room to be made
with control rooms of power plants.
Land
• Existing land – 220KV AIS of MRSS 2 to be used for installation of DG Sets.
• MRSS 2 GIS Building (Old LDC Room) to be used for control room

Utilities
Water
• To be taken from MRSS 2 (Already available)
Power
• To be taken from MRSS 2 (Already available)

Regulatory Challenges

Clearance required from following authorities:

• CCOE (Chief Controller of Explosives)
• Factory Inspectorate Approval
• State Pollution Control Board (SPCB)
• CEIG (Chief Electrical inspector to Government)
• Petroleum and explosives safety organization (PESO)
• Road transport & Highway authority (for transportation of equipment)

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Execution Strategies

• Installation process to be carried out after conversion of existing MRSS 2 220KV

Switchyard into GIS.
• Also, feasibility study is required to make the transportation plan of 202 Ton Engine, 60
Ton Alternator along with other auxiliaries as there are space constraints in Sahibabad for
moving out the machinery out of the buildings.
• Detailed engineering is required for:
o Proposing details/drawings of civil/structural requirements in TSM.
o Checking the validity of electrical scheme for interconnection.
• This is an exhaustive task which requires coordination of multiple agencies like –
Mechanical, Civil, Engineering Projects, OEM Support & various other vendor partners.
• The budget for this is about Rs. 90 Cr.

Packaging strategy
• N/A

5. Project Cost (all figures are in Cr.)

Amount
Input Tax
Gross of (Net of Basis of
SN Category Credit (in
GST (Rs.Cr.) tax) (in estimates
Cr.)
Cr.)
Dismantling & shifting the
On assumption
healthy equipment to the new
1. 17.7 2.7 15 basis
site in Odisha (along with
insurance)
Note: Assumption
Upgradation of existing
is based on
2 equipment & replacement of 14.16 2.16 12
experience of
worn-out parts
past projects.
Procurement of new
3 29.5 4.5 25 Detailed study is
equipment
needed for
4 Civil & structural work 29.5 4.5 25
proper cost
5 Cost of additional services 17.7 2.7 15
estimation.
6 Contingency (5%) 5.42 0.82 4.6
Total 113.98 17.38 96.6

6. Key Project Outcomes / KPI:

Unit of Base
Parameters As Is To Be Benchmark
Measurement Year
Start Up of
plant after black Hours 2023 12 1
out

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7. Environment and Carbon Emission KPIs:
(Indicate Air Pollution (CO2, Sox, Nox, Fugitive, etc.), Water Consumption, Effluent Discharge,
Solid Waste Management as per EC/CTO norms along with Benchmark. Also, indicate the
percentage recycling of water and wastes generated.)

Unit of Base
Parameters As Is To Be Benchmark
Measurement Year
NOX mg/Nm3 2023 0 368
The mentioned
SO2 mg/Nm3 2023 0 29.2 figures are as per
the reports from
Sahibabad.
CO2 (%) (v/v) 2023 0 9.5

8. Regulatory Challenges:

Provide the details of statutory requirement, if any, with expected timeline of clearances. Indicate the statutory
clearances addressed to enable the site work.

Statutory clearances required are:

• CCOE (Chief Controller of Explosives)

• Factory Inspectorate Approval
• State Pollution Control Board (SPCB)
• CEIG (Chief Electrical inspector to Government)
• Petroleum and explosives safety organization (PESO)
• Road transport & Highway authority (for transportation of equipment)

9. Financials:

Not Applicable, as the project does not give any tangible savings.

The estimated cost of project on assumption basis would be Rs. 96.6 Cr. (Including additional 5% cost
in contingency cases- NGST)

10. Phasing of Expenditure: (all figures are in Cr.)

Input tax
Year Gross of GST credit (at Net of GST
18% GST)
FY23-24 0 0 0
FY24-25 36 6.48 42.48
FY25-26 60 10.8 70.8
TOTAL 96 17.28 113.28

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11. Risk and Mitigation Strategy

Risk Category Risk Description Mitigation Plan

Failure of DG to start
Technological Risk
at the time of
emergency.
Tripping of DG while
Operational Risk simultaneous start of
HT Motors
The equipment will have a systematic plant of
maintenance & regular trails to ensure its
healthiness during emergencies.
SOP to be prepared for starting of plant in
blackout from the DG Sets.
Hardwiring interlocks to be provided to inhibit
simultaneous starting of HT Motors.

Increase in cost due

Capex Increase to fluctuation in Timely placement of the order. Contingency @
commodity cost and 5% already taken in account.
labor wages
Project manager will be assigned to look after
Delayed Delivery Project Delay the delay & to come up with new action plan to
ensure project completion is on time.

(Risk assessment of all new growth/strategic projects above Rs 700 crores per project (US$100m) should be carried out and
signed off by ERM before the project is placed to Peer Review Group)

12. Project Schedule of Major Milestones (include the project schedule of major milestones till
commissioning and hand-over of project)

Timelines
ACTIVITIES
(MM/YY)
Approval of project Dec.23
Placement of order Apr.24
Study of the project & detailed engineering Aug.24
Drawing approvals Oct.24
Shifting of equipment Dec.24
Erection of structures & buildings Dec.25
Supply of additional equipment Jul.26
Installation, Testing, Commissioning & Trails Dec.26

Considering approval of the project in 36 (month)

Signature of BU Project Owner

Signature of BU-PRG Chairman

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Annexure :1

Project Owner to arrange for sign-off from relevant stakeholders as per following table

SN Yes / No/
Parameter Signoff from
NA
1 Validating operational assumption & KPI impact Project Owner
Chief of the operating
2 Higher production volume
division
3 Product Mix / Realization Marketing and Sales
4 Capital/ Revenue nature F&A
Chief Power System &
5 Power & Gas
Energy
-Chief Corporate
6 Land
Administration
Building up of new infrastructure or relocation of an
7 Infrastructure Committee
existing one
Chief Environment
8 Approval from Environment Management
Management
Chairman of Electrics &
9 Approval from Obsolescence Committee Automation Obsolescence
Management Committee
10 Approval from ME&VRC Chairman ME&VRC
11 Automation/Digitalization Chief IT (BU)
Scope Matrix

Case 1: E&P full responsibility: Pre-approval -

Project readiness, Post approval- Execution

12 Case 2: BU with support of E&P: Partial help from GM D&E/ Project Owner Case 2
E&P as per Annexure 2

Case 3: BU full responsibility: Pre-approval -Project

readiness, Post approval- Execution

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Annexure A:

1. EQUIPMENT WHICH ARE TO BE SHIFTED TO NEW SITE

Sl. No. Equipment

1.1 2 X 12MW DG (Engine & Alternator)
1.2 Synchronization Panel
1.3 10T EOT Crane
1.4 18kL Lube Oil Tank
1.5 300kL LDO Tank
1.6 1MW; 11kV DG_Eme. Aux. backup for 12MW DG Units
1.7 3 X (30bar) IR Compressors [Starter]
1.8 Exhaust Systems

2. EQUIPMENT WHICH WOULD REQUIRE UPGRADATION OR ITS FAULTY COMPONENTS MUST BE

REPLACED AFTER SHIFTING.

Sl. No. Equipment Remarks

To be shifted
Auxiliary motors,
2.1 Except Raw water pump, cooling tower fans & make up
fans, pumps
water pump which are to be newly procured.
2.2 PLC (Siemens S5) To be upgraded to S7
Fuel supply
2.3 Related motors, valves, sensing elements, tanks etc. to
systems
be surveyed. To be shifted if the same is in working
Air & Water supply
2.4 condition ELSE it is to be newly procured.
systems

3. EQUIPMENT WHICH ARE TO BE NEWLY PROCURED

Sl. No. Equipment

3.1 11kV Switchgear (2 Incomers, 4 Outgoings & Bus Coupler)
3.2 1nos. Of New 40MVA T/F to be procured to sync. with our system
3.3 2nos. Earthing Transformers
3.4 Connecting pipelines for lube oil & LDO
3
3.5 Cooling Tower (450m )
3.6 Related HT & LT Cables

4. CIVIL RELATED JOBS WHICH ARE TO BE DONE AT NEW SITES

Sl. No. Civil Structures

4.1 Chimney [Existing Height - 105m]
4.2 Building Size [Existing Dimensions: W – 36m, L – 40m, H – 20m]
4.3 Building Civil Foundation
4.4 DG Foundation [Existing size - 202 Ton (Engine) & 60 Ton (Alternator)]
4.5 Cooling Tower Foundation
4.6 Building/structural requirements for fuel/air & water supply systems
4.7 Construction of pump house for the DG Sets

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 5. ADDITIONAL SERVICES WHICH ARE REQUIRED TO MAKE THE DG SETS OPERATIONAL AT
NEW SITE

Sl. No. Activities

5.1 Dismantling of existing equipment
5.2 Transportation of the equipment via Rail/Road
5.3 Installation of equipment at new site
5.4 Commissioning & testing of systems
5.5 Installation of EOT Cranes
5.6 Overhauling of the DG Sets
5.7 Fabrication, laying & connection of pipelines
5.8 Fabrication & laying of cable trays
5.9 Fabrication, laying & termination of cables
5.10 Construction of earth pits
5.11 Water source of required capacity at new site
5.12 Electrical power source for HT DG Auxiliaries.

PICTURES FROM THE SITE VISIT AT SAHIBABAD TO HAVE AN IDEA ABOUT THE SIZE OF THE
PROJECT:

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 Form No: CPL/F/02
Planning & Budgeting CHECKLIST & GUIDELINES
Capital Planning SHEET: 11 of 11
TITLE: BU-PRG Recommendation Note REV NO: 05
DOC. NO: CPL/CHK/01 EFFECTIVE DATE: 16-09-21

Annexure 2: Scope Matrix for BU Executed projects which needs E&P support

L1 Project Environment
Project Phase Concept Note Basic Design Cost Estimation Risk Assessment PRG Note
Schedule Impact

A. Pre-Approval –
Readiness of project
for PRG

(BU-PRG BU E&P E&P and BU E&P BU BU E&P

Recommended and
Prioritized Schemes
Only)

E&P Support* Required for:

Relocation,
Enabling and Structural Utility & Water
Project Phase Civil Engineering EIC Engineering Procurement Execution
Layout Engineering Engineering
Preparation
B. Post Approval:
E&P E&P E&P E&P E&P E&P E&P
Execution of
Projects
* Only after mutual agreement between E&P and BU
E&P: Engineering and Projects BU: Business Unit

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