NHPC has reportedly threatened to ban BHEL from bidding for future projects following a controversy regarding NHPC's Subansiri hydropower project in Arunachal Pradesh.

NHPC had invited bids for the 2,000 MW Subansiri project in Arunachal Pradesh to which both BHEL and Alstom had responded. Due to some "errors" in BHEL's bid, it had to be revalued. The contract eventually went Alstom's way since the price quoted by the French company was lower than BHEL's, on a comparable basis. The contract is valued at around Rs.1,600 crore.

Following some conditions in the bid document, NHPC is technically in a position to blacklist BHEL from bidding in future.

The matter has been escalated to the Union power ministry, and Alstom's bid is reportedly going to be audited by an independent agency.

Meanwhile, NHPC has already sent the letter of award of the electro-mechanical package to Alstom. The matter is likely to be resolved by the first week of March 2005, according to NHPC officials.