icb evaluation

Evaluation of bids underInternational Competitive Bidding

(ICB)

1. Before proceeding with detailed evaluation, it should be ascertained whether the bids:

i) meet the eligibility requirements specified in Paragraphs 1.6 to 1.8 of the Bank Guidelines;

ii) have been properly signed;[Judgment should be used in applying the above tests. For instance, if the bidding document stipulated that each page is to be signed or initialed, and a bidder omitted to sign one or more pages containing more supporting information, this should not be a ground for disqualification. Similarly, minor discrepancies e.g., if a bidder has failed to furnish the required number of copies or has failed to use the supplied form for filling in the prices, but has submitted a similar form on his own letterhead could be rectified through the clarification process without giving any benefit to the bidder and without prejudice to other bidders’ interest].

iii) are accompanied by the required authorization/undertaking (for agents and subsidiaries) as specified in the document.

Evaluation of bids under ICB2

iv) are accompanied by the required securities;

[Where the bidder has quoted for more than one pack, if the bid security furnished is inadequate for all the packs, the Purchaser shall take the price bid into account only to the extent the bid is secured. For this purpose, the extent to which the bid is secured shall be determined by evaluating the requirement of bid security to be furnished for the packs included in his bid (offer) in the serial order of the Schedule of Requirements of the Bidding Documents.]

v) are substantially responsive to the requirements of the bidding documents;

vi) provide any clarification and or substantiation that the Purchaser/Employer is required to determine responsiveness; and

vii) are otherwise generally in order.


2. Judgement should be used in ascertaining the above. The purchaser may waive any minor informality or non-conformity or irregularity in a bid, which does not constitute a material deviation, provided such waiver, does not prejudice or affect the relative ranking of any bidder. In those cases, for the purpose of evaluation, adjustments should be made for the costs to the purchaser of any quantifiable non-material deviations or reservations.

The evaluation will exclude and not take into account any allowance for price adjustment during the period of execution of the contract.


Substantial Responsiveness

3. A substantially responsive bid is defined as under in SBD (Works) and SBD (Goods).

SBD Works

“28.2 A substantially responsive bid is one which conforms to all the terms, conditions and specifications of the bidding documents, without material deviation or reservation. A material deviation or reservation is one

(i) which affects in any substantial way the scope, quality or performance of the works;

(ii) which limits in any substantial way, inconsistent with the bidding document, the Employer’s rights or the bidder’s obligations under the contract; or

(iii) whose rectification would affect unfairly the competitive position of other bidders presenting substantially responsive bids.”


SBD Goods

“24.2 Deviations from or objections or reservations to critical provisions such as those concerning Bid Security ITB Clause 15), Applicable Law (GCC Clause 30), and Taxes and Duties (GCC Clause 32) will be deemed to be a material deviation.”

In addition Deemed Export Benefits (ITB Clause 11.2), Performance Security (GCC Clause 7), Warranty (GCC Clause 15), Force Majeure (GCC Clause 25) Limitation of Liability (GCC 29) are also to be treated as critical provisions for the above purpose.


UNACCEPTABLE DEVIATIONS

* Late Bid Submission

* Ineligible Bidder

* Unsigned Bid

* No Acceptable Bid Security

* Bidder / JV not as prequalified

* Price Adjustment Vs Fixed Price

* Unacceptable Alternative Design

* Non-Conforming Time Phasing

* Unacceptable Subcontracting

* Qualification on Arbitration Rules, Location and other Clauses indicated in Clause 24.2 of ITB [SBD Goods].


DEBATABLE DEVIATIONS

* Different Payment Terms

* Non Compliance Local Regulations

- Labour, Imports, Duties, Taxes, etc.

* Completion/Maintenance Periods

* Special Methods of Construction

* Questionable Subcontracting

* Omission of (Minor) Works/Items

* Limited Liabilities

* Modified Liquidated Damages

* Different Codes/Standards

- Materials, Workmanship, Design, etc.


4. If a bid is not substantially responsive, i.e., it contains material deviations from or reservations to the terms, conditions and specifications in the documents, it should not be considered further.

5. No bidder should be requested or permitted to alter his bid after the bid has been opened. In order to evaluate his bid, if any clarification is required, the same can be called. The request for clarification and the response shall be in writing and no change in the price or substance of the bid shall be sought offered or permitted. [Bids should not be rejected solely on account of non-submission of historical information. Bidders should be given one opportunity to furnish the necessary information by giving adequate time. Where necessary purchaser/employer may also consider verifying the information independently before considering rejection of lower offers for non-submission of historical information].


6. No preferential treatment should be given to any bidder or class of bidders either for price or for conditions unless specifically cleared with the Bank and stipulated in the Project Agreement.

Any procedure, under which the bids above or below a pre-determined assessment of bid values are automatically disqualified, is not acceptable.


7. Conversion to single currency :

The bid price is the sum of all payments to be made to the bidder in various currencies . To facilitate evaluation and comparison of bids, the department will convert the amounts in various currencies in which the bid price is payable to Indian Rupees [Borrower’s Currency] at the selling rates for similar transactions published by any Scheduled Bank in India as per procedure stipulated in the bidding document.


Arithmetical Errors

8. Goods

(a) Arithmetical errors will be rectified on the following basis. If there is a discrepancy between the unit price and the total price that is obtained by multiplying the unit price and quantity, the unit price shall prevail, and the total price shall be corrected. If the supplier does not accept the correction of the errors, its bid may be forfeited. If there is a discrepancy between the words and figures, the amount in words will prevail.


Civil Works

(b) “Bids determined to be substantially responsive will be checked by the Employer for any arithmetic errors. The Employer will correct errors as follows:

- where there is a discrepancy between the amounts in figures and in words, the amount in words will govern; and

- where there is a discrepancy between the unit rate and the line item total resulting from multiplying the unit rate by the quantity, the unit rate as quoted will govern, unless in the opinion of the Employer there is an obviously gross misplacement of the decimal point in the unit rate, in which case the line item total as quoted will govern and the unit rate will be corrected.


The amount stated in the Bid will be adjusted by the Employer in accordance with the above procedure for the correction of errors and, with the concurrence f the Bidder, shall be considered as binding upon the Bidder. If the Bidder does not accept the corrected amount the Bid will be rejected, and the Bid Security may be forfeited in accordance with ……………………….. .”


Evaluation of Goods

9. (a) The evaluation of a bid will exclude and not take into account:

- in the case of goods manufactured in India (borrower’s country) or goods of foreign original already located in India (borrower’s country), sales and other similar taxes which will be payable on the goods if the contract is awarded to the bidder;

- in the case of goods of foreign origin offered from abroad, Customs Duty and other similar import taxes which will be payable on the goods if the contract is awarded to the bidder; and

- any allowance for price adjustment during the period of execution of the contract if provided in the bid.


(b) The comparison shall be EXW price of the goods offered from within India (borrower’s country), such price to include all costs as well as duties and taxes paid or payable on components and raw material incorporated in the goods, and the CIF port of destination price of the goods offered from outside India.[CIP in the case of container/Air delivery/multimode transport goods]

(c) Evaluation of the bids should take into account, in addition to the bid price and the price of incidental services, the following factors in a manner and to the extend indicated in the documents:


- the cost of port clearance, inland transportation, insurance and other costs within India (borrower’s country) incidental to the delivery of the goods to their final destination;[Excluding customs duty]

- the delivery schedule offered in the bid;

- deviations in the payment schedule from that specified;

- the cost of the components, mandatory spare parts and service;


- the availability in India (borrower’s country) of spare parts and after sales service for the equipment offered;

- the projected operating and maintenance costs during the life of the equipment;

- the performance and productivity of the equipment offered; and

- other specific criteria indicated in the Bidding Data.


The bids should be loaded appropriately as per the bidding documents for any deviations with reference to the requirements.

(d) Bonus or additional credits for bid evaluation should not be given for offered features that exceed the required standards or specifications viz. additional horse power or capacity unless there is a specific provision for this in the bidding document.


(e) Bids often omit a particular component or options or accessories or a minor attachment (viz. toolkit or spare wheel in a vehicle). If the item offered for supply is otherwise functional and if the omissions are minor and these parts can be procured separately, the bid may be loaded for parts not included in the scope of supply and evaluated. In other cases, the bid should be treated as non-responsive.


(f) Bidders offering goods from within India (borrower’s country), must ascertain their selves availability of deemed export benefits, if any. They are to be solely responsible for applying for deemed export benefits, which they have considered in their offer and the purchaser will not compensate the bidder in case of failure to receive such benefits for any reason whatsoever. Any such duties or taxes additionally payable during the performance of the contract will be to the bidders account and the Purchaser shall entertain no separate claims on this behalf.


Applicable for India only.

Where the bidder has quoted taking into account the Deemed Export Benefits, he must give all information required for issue of a Project Authority Certificate in terms of the Import Export Policy alongwith his bid. This Certificate will be issued on this basis only and no subsequent change will be permitted. Where the Purchaser issues such a Certificate, Excise Duty will not be reimbursed separately.

Such a provision should be made in the bidding documents and bids of the bidders who do not accept this provision should be declared as non-responsive and rejected.

(g) All substantially responsive bids should be evaluated in detail as per the procedure stipulated in the bidding documents.


Applicable for India only.

Domestic Preference

(h) Bids will be classified in one the three groups as follows:

Group A Bids offering goods manufactured in India for:(i) labour raw materials and

components from within India (borrower’s country)account for more than 30% of the EXW price; and

(ii) the production facility in which they will be manufactured or assembled has been engaged in manufacturing or assembling such goods at least since the date of the bid submission;

Group B All other bids offering goods manufactured in India (borrower’s country); and

Group C Bids offering goods of foreign origin that have been already imported or to be imported by the Purchaser directly or through the supplier’s local agent.

[The above is as per new Guidelines]Evaluation of bids under ICB23

In the comparison of evaluated bids, the purchaser will grant a margin of preference to goods manufactured in India (borrower’s country) in accordance with the following procedures provided the bidder shall have established to the satisfaction of the purchaser and the Bank that it complies within the criteria specified in the ITB as stated above.

The following general guidelines are borne in mind in the application of domestic price preference in the evaluation of goods:

i) Application of a preference margin is permissible only when the loan agreement provides for it by specific reference in the Procurement Schedule and the bidding documents specifically outline the procedure for its application;


ii) The goods under procurement are ‘manufactured goods’ involving assembly fabrication, processing, etc., where a commercially recognized final product results that is substantially different in the basic characteristics from its components and raw materials;

iii) The goods offered by foreign and domestic bidders are identical or comparable in respect of quality, size, capacity and performance;


iv) that, among the bids, there is a qualified domestic bid (Group A) which, irrespective of the nationality of the bidder has offered goods assembled/ manufactured in India (borrower’s country):

(a) In which the value of labour, raw material and components from India (borrower’s country) will account for more than 30% of the EXW price of the product offered; and

(b)The production facility in which those goods will be manufactured or assembled has been engaged in manufacturing assembling such goods at least since the time of bid submission;


v) The qualified domestic bid (Group A) shall quote the ex-factory price for the goods under procurement, say, an engine, and not break up the price partly as CIF covering imported components, and partly on ‘ex-factory’ basis covering the local costs;

vi) The ex-factory price quoted by the domestic manufacturer shall include all duties, taxes, levies, tariff, etc., paid or payable on the raw material and components purchased in the domestic market or imported;


vii) The margin of preference shall be added to the CIF/CIP price of foreign bids and not subtracted from the domestic bid;

viii) The margin of preference shall be equal to 15% of the CIF/CIP value of the goods offered in each such bid, whichever is less; and

ix) The margin of preference may be applied even if the Purchaser is exempt from payment of customs tariff.

(Data necessary to verify compliance on the above is to be sought from the bidders, by the purchaser alongwith his bid)

(i) The Purchaser will first review the bids to confirm the appropriateness


of and to modify as necessary, the bid group classification to which the bidders assigned their bids in preparing their bid forms and price schedules.

(j) All evaluated bids in each group will then be compared among themselves to determine the lowest evaluated bid of each group. The lowest evaluated bid of each group will next be compared with the lowest evaluated bids for the other groups. If this comparison results in a bid from Group A and B being the lowest, it will be selected for the award of the contract.


(k) If as a result of the preceding comparison, the lowest bid is from Group C, all Group C bids will then further be compared with the lowest evaluated bid from Group A after adding to the evaluated bid price of the imported goods offered in each Group C bid for the purpose of their comparison only:

- The amount of Custom Duty and other import taxes, which a non-exempt importer would have to pay or paid for the importation of the goods offered in each Group C bid;

Or

- 15% of the CIF/CIP bid price of such goods,

- If the Group A bid in the further comparison is the lowest, it will be


selected for award. If not, the lowest evaluated bid from Group C as determined from the comparison under Paragraph (j) above will be selected.

- In the case of single responsibility or turnkey contracts for the supply of a number of discrete items of equipment as well as major installation and /or construction services no margin of preference will apply. However with Bank’s “no objection”, bids for such contracts may be invited and evaluated on the basis of DDP (named place of destination) prices for goods manufactured abroad. – see foot note 62 of guidelines.


DOMESTIC PREFERENCE (ILLUSTRATIONS)

CASE 1

Procurement of Vehicles All figures in USD

Evaluation on Price Alone A1 B1 C1 C2 C3

Price Ex-factory CIF 10,000 9,900 10,500 11,300 12,000

Step 1

Lowest Bid in Each Group 10,000 9,900 10,500

Ranking 2 1 3

Award B1

DOMESTIC PREFERENCE (ILLUSTRATIONS)CASE 2

Procurement of Vehicles All figures in USDEvaluation on Price Alone A1 B1 C1 C2 C3Price Ex-factory CIF 10,000 9,900 9,500 11,300 12,000Step 1Lowest Bid in Each Group 10,000 9,900 9,500Ranking 3 2 1Since LEB is in Group CStep 2Lowest in GP A and all GPC Bids 10,000 9,500 11,300 12,000Domestic PreferenceCustoms Duty or 15% of CIFCustoms Duty 30% of CIF so -- 1,425 1,695 1,80015% of CIFTotal for Comparison 10,000 10,925 12,995 13,800Ranking 1 2 3 4Award A1

DOMESTIC PREFERENCE (ILLUSTRATIONS)

CASE 3 – Procurement of Vehicles

Evaluation on Price plus All figures in USDOperating (NPV) cost for 4 years A1 B1 C1 C2 C3- Price ex-factory / CIF 10,000 11,000 12,000 13,500 9,000- NPV of Operating Cost 10,000 10,000 6,000 8,000 9,100TOTAL EVALUATED COST 20,000 21,000 18,000 21,500 18,100Step 1Lowest Bid in Each Group 20,000 21,000 18,000Ranking 2 3 1Since the lowest is from Group CStep 2Group A and all Group C 20,000 18,000 21,500 18,100Domestic Preference MarginDuty 30%15% of CIF Price -- 1,800 2,025 1,350Total for Comparison 20,000 19,800 23,525 19,450Ranking 3 2 4 1Since the lowest is from Group C go back to Step 1 (to ascertain the lowest among C without Domestic Preference Margin)

2 3 1

Award C1


Evaluation of Civil Works

10. (a) All substantially responsive bids should be evaluated in detail as per the procedure stipulated in the bidding documents.

(b) Evaluated bid price will be calculated by adjusting the bid price as follows:

- Making any correction for errors;

- Excluding provisional sums and the provision, if any, for contingencies in the summary Bill of Quantities but including Day work, where priced competitively;

- Converting the amount resulting from applying the above to a single currency;


- Making an appropriate adjustment on sound technical and/or financial grounds for any other quantifiable acceptable variations, deviations or alternative offers;

- Making an allowance for varying times for the completion offered by the bidders, if permitted in the Bidding Data and in the manner prescribed therein; and

- Applying any discounts offered by the bidder for the award of more than one contract, if bidding for this contract is being done concurrently with other contracts.


(c)The Employer reserves the right to accept or reject any variation, deviation, or alternative offer. Variations, deviations, alternative offers, and other factor that re in excess of the requirements of the bidding documents shall not be taken into account in the bid evaluation.

(d)The estimated effect of the price adjustment provisions of the Conditions of Contract, applied over the period of execution of the contract, shall not be taken into account in bid evaluation.


(e) If the bid, which results in the lowest Evaluated Bid Price, is seriously unbalanced or front loaded in relation to the Engineer’s estimate of the items of work to be performed under the contract, the Employer may require the bidder to produce detailed price analyses for any or all items of the Bill of Quantities, to demonstrate the internal consistency of those prices with the construction methods and schedule proposed. After the evaluation of the price analyses, taking into consideration the schedule of estimated contract payments, the Employer may require that the amount of the performance security set forth be increased at the expense of the bidder to a level sufficient to protect the Employer against financial loss in the event of default of the successful bidder under the contract.


Preference for Domestic Bidders

(f) (i) Domestic Bidders shall provide all evidence necessary to prove the following criteria to be eligible for a 7 ½ % margin of preference in the comparison of their bids with those of non-eligible bidders;

A “domestic bidder” is one that meets the following criteria:

(a) for an individual firm:

(i) is registered in the country of the borrower;

(ii) has more than 50% ownership by nationals of the country of the Borrower;


(iii) does not subcontract more than 10% of the contract price, excluding provisional sums, to foreign contractors.

(b)for a joint venture (JV) of domestic firms:

(i) individual member firms shall satisfy (a)(i) and (a)(ii) above;

(ii) the JV shall be registered in the country of the Borrower;

(iii) the JV shall not subcontract more than 10% of the contract price, excluding provisional sums, to foreign firms.


(iii) The following procedure will be used to give effect to the margin of preference. After the bids have been evaluated in accordance with the provision in the bidding documents, the responsive bids will be classified into the following groups:

Group A Bids offered by domestic bidders meeting the criteria set forth in Paragraph (i) above and by joint ventures meeting the criteria set forth in Paragraph (iii) above

Group B Bids offered by other bidders.


For the purpose of further evaluation and comparison of the bids only an amount equal to 7 ½ % of the evaluated bid price (adjusted) will be added to such evaluated bid price of bids classified in Group B.

The suggested format for the evaluation and comparison of the bid evaluation report for civil works is circulated.


PREFERENCE FORDOMESTIC CONTRACTORS

EVALUATION PROCEDURE (Clause 32.4)

* Divide Bidders into:- Group A [Domestic Contractors] and- Group B [Other Contractors]

Bidders A A1 B B1

Bid Price 1,140 1,200 1,150 1,160

Adjusted Bid Price* 1,040 1,100 1,000 1,050

RANKING (2) (4) (1) (3)

Dom. Pref 7.5%** -- -- 75 79

TOTAL 1,040 1,100 1,075 1,129

RANKING (1) (3) (2) (4)

Contract Award x

_______________________* Corrected for Errors, and net of provisional sums

[Clause 31.2 a, b, c and f]

** Applied to adjusted Bid Price


PREFERENCE FORDOMESTIC CONTRACTORS

NOTE:Provisional sums (PS) and contingency allowances (CA) are not competitive elements of bidding, and should be excluded from Bid Comparison. Their inclusion can distort the evaluation process when preference is applied, as shown in the example below.

CASE 1: PS/CA Excluded:

GROUP A GROUP BCorrected Bid Price 107 100Less PS/CA -20 -20Adjusted Bid Price 87 80Add 7 ½ % Preference -- 6Evaluated Bid Price 87 86Ranking Order (2) (1)

CASE 2: PS/CA Included:

Corrected Bid Price 107 100Add 7 ½ % Preference -- 7.5Evaluated Bid Price 107 107.5Ranking Order (1) (2)


LIFE CYCLE COST METHOD

* Cost to own and operate item during its useful life

Initial Purchase Price

Adjusted for extras, delivery variations in payment term etc.-- Value of adjustments added

to bid price

Operating Cost during life of item

Fuel, spare parts, maintenance (x years)

-- Annual costs discounted to NPV

Ownership cost during life of item

Economical useful life (x years)

-- Resale or scrap value discounted to NPV


* Efficiency Cost Method

Capitalize differences in efficiency in operation of items i.e., boiler, turbine, transformer etc. during life

* Productivity Cost Method

Determine life cycle cost per unit of output for comparison purposes

Life cycle cost of plant (x years) NPV divided by total unit output of plant


BID EVALUATION FOR URBAN BUSES

DOMESTIC BID FOREIGN BIDPRICE EXFACTORY/FOB PES 900,000 DM 100,000

OCEAN FREIGHT AND INSURANCE

-- DM 5,625

PRICE EXFAC./CIF PORT OF ENTRY

PES 900,000 DM 105,625

PRICE EXFAC./CIF CONVERTED TO COMMON CURRENCY (USD)

45,000 42,250

INLAND TRANSPORTATION 200 1,500EVALUATED COST DELIVERED AT SITE

45,200 43,750

PENALTY FOR DEVIATION IN PAYMENT TERMS

-- 50

DELIVERY/COMPLETION EVALUATION

1,200 --

WARRANTY -- 100

TOTAL EVALUATED COST 46,400 44,350

PRICE PREFERENCE (15% OF CIF)

-- 6,337

EVALUATED COST WITH PREFERENCE

46,400 50,687

RANKING 1 2


ON “LIFE CYCLE COST” BASIS

Total Evaluated Cost (without preference)

46,400 44,350

Fuel Cost for 8 years 52,000 46,000

Maintenance Cost for 8 years 34,000 28,000

132,400 118,350

Minus Depreciated Cost/Resale Value

- 2,000 - 5,000

Life cycle Cost 130,400 113,350

Domestic Preference (15% of CIF)

6,337

Evaluated Cost with Preference 130,400 119,687

Ranking 2 1


BID EVALUATION USING LIFE CYCLE COSTING FOR

PROCUREMENT OF 100 HIGHWAY TRUCKS

RELEVANT PART OF THE BID EVALUATION CLAUSES IN THE BIDDING DOCUMENTS

The evaluation and comparison of bids shall be based on the life cycle cost for the vehicles during the first 6 years, worked out in the following manner.

1. INITIAL PRICE:

- CIF Price quoted for trucks offered from abroad

- ex-factory/ex-showroom price for vehicles offered from within the country


(Contd.……)

2. OPERATING AND MAINTAINENCE COSTS:

2.1 Fuel costs shall be computed on the basis of 100,000 Km of operation per year at a fuel price of 0.80 USD per liter, discounted to net present value at a discount rate of 10 percent.

2.2 Spare parts cost shall be based on 100,000 Km per year of operation, based on the guaranteed figures provided by the bidder for each year, discounted to net present values at a discount rate of 10 percent. If guaranteed figures are not provided, purchaser may use estimated figures based on past experience if available.


(Contd.…..)

3. DEPRECIATED COST:

3.1 Purchaser shall estimate the depreciated cost of the vehicle offered based on the guaranteed life prior to the first major overhaul, or based on past experience, but in no case more than 8 years.

4. BIDDERS SHALL FURNISH ALL THE DATA REQUIRED FOR THE ABOVE COMPUTATIONS, AS FURTHER OUTLINED UNDER CLAUSE OF THE TECHNICAL SPECIFICATIONS.


BID EVALUATION USING LIFE CYCLE COST 100 HIGHWAY

TRUCKS All Figures in USD

A C1. INITIAL COSTS

Bid Price Ex-factory/CIF 65,000 70,000Evaluation Adjustment for Delivery Schedule 6,000 --Evaluation Adjustment for variation in payment terms -- 1,000

TOTAL 71,000 71,000

2. OPERATING AND MAINTENANCE COSTS

Fuel Guaranteed cost for each year (8,000) (6,000)NPV for 6 years 34,840 26,130

Spares Guaranteed cost (Average) for each year (5,000) (4,000)NPV for 6 years 21,775 17,420

TOTAL 56,615 43,550

3. DEPRECITED VALUE (DEDUCT)

Life Depreciated Value

(6 Yrs.)0

(8 Yrs.)12,500

4. TOTAL LIFE CYCLE COST 127,615 102,050RANKING 2 1


BID EVALUATION USING LIFE CYCLE COSTING FOR THE PROCUREMENT OF

A 500 MW COAL-FIRED POWER STATION BOILER COMPLEX

RELEVANT PART OF THE BID EVALUATION CLAUSES IN THE BIDDING

DOCUMENTS

Bids will be evaluated on life cycle principles by evaluating the initial cost and the cost of operation of the plant over a period of 20 years. The evaluation of the operating costs will be based on the capitalized cost for each percent of boiler efficiency above the minimum acceptable, as specified in the technical specification, discounted to present value at a discount rate of 10 percent. The evaluation will be on the following norms:

1. Bid Price for the boiler and mandatory spares.

2. Price for spares required for the first five years of operations, capitalized to present value at 10 percent.


(Contd. ……)

3. Adjustments to bid price for omissions, deviations and exceptions to technical and commercial conditions in the bidding documents.

4. Capitalized cost savings for boiler efficiency at the rate of US$ 500,000 per each 0.1 percent above 80 percent.

5. Capitalized cost for the auxiliary power consumption at US $ 2,000 per KW.


BID EVLAUATION USING LIFE CYCLE COSTING 500 MW COAL-FIRED POWER

STATION All figures in USD

(In Thousands)

1. INITIAL COSTS A CTOTAL QUOTED PRICE, INCLUDING MANDATORY SPARES

185,000 200,000

2. ADJUSTMENTS(A) FOR OMISSIONS IN

MANDATORY SPARES3,000 --

(B) COMMERCIAL EXCEPTIONS(delivery, payment terms)

15,500 12,000

(C) TECHNICAL EXCEPTIONS(omission of equipment, capacity shortage, etc.)

28,000 24,000

INITIAL COST 231,500 236,0003. ADJUSTMENTS FOR FOLLOW-

ON COSTS(A) NPV OF SPARES FOR FIVE

YEARS40,000 28,000

(B) NPV OF SAVING FOR HIGHER EFFICIENCY

-12,000 -18,000

(C) NPV OF AUXILIARY POWER CONSUMPTION

5,000 7,000

TOTAL ADJUSTMENT FOR FOLLOW-ON COST

33,000 17,000

3. TOTAL EVALUATED COST ON 264,500 253,000


LCC PRINCIPLESRANKING 2 1

BID EVALUATION USING LIFE CYCLE COSTING OIL PALM PLANT

RELEVANT PART OF THE BID EVALUATION CLAUSES IN THE

BIDDING DOCUMENTS:

The evaluation and comparison of responsive bids shall be based on the total life cycle cost for six years, per unit of output. The life cycle cost shall be the sum of the initial purchase price of the plant and the cost of operation in electric energy for six years of operation at a unit cost of US $ 0.10 Per KWH, discounted to present value at 12 percent.


BID EVALUATION USING LIFE CYCLE COSTING OIL PALM PLANT

BID EVLAUTION AND COMPARISON

All Figures in USD

(in Thousands)

A B

INITIAL COSTS

1. Initial Cost 9,500 10,300

2. Operating Cost per Year (1,200) (1,000)

Operating Cost for 6 yearsNPV at 12 percent

4,933 4,111

3. Total Life Cycle Cost 14,433 14,411

4. Output per year (Tons) 3,600 4,000

5. Evaluated Cost Per Ton of Output

4.01 3.60

RANKING 2 1

A – 12 Million KWH @.10 Per KWH B – 10 Million KWH @.10 Per KWH


Award of Contract

11. Contract should be awarded to a bidder, whose bid has been determined to be substantially responsive and who has offered the lowest evaluated bid price provided further that the bidder is determined to be qualified to perform the contract satisfactorily and meets the qualification criteria specified in the bidding document. If the lowest evaluated bidder (in the same name and style) does not meet the qualification criteria, his bid should be rejected and a similar determination should be made for the next lowest evaluated bidder; the process continued, if necessary.


A bidder should not be required as a condition of award to undertake responsibilities for work not stipulated in the bidding document or other wise to modify his bid as originally submitted.

12. Where bidders were pre-qualified, the updated pre-qualification information supplied with the bid with special reference to current financial status and work commitments acquired since pre-qualification, should be verified and regardless of pre-qualification, the contract should not be awarded to a bidder who is found lacking the financial and technical resources required to undertake the work at the time of award.


13. If the contract is being let on a ‘Slice and Package’ basis, the lowest evaluated bid price (the combined cost of all the lots) will be determined in conjunction with other contracts to be awarded concurrently taking into account any discounts offered by the bidders for the award of more than one contract.

Single Bids

14. Where only one bid is received, efforts should be made to ascertain the reasons. If it is determined that publicity was not adequate, bid specifications or any of terms were restrictive or unclear, the bid should be cancelled and invited afresh after amending the specifications/terms.

If however, it is determined that bid specifications are not restrictive and the prices quoted are reasonable and bid is technically and commercially responsive, the single bid should be considered for award.


15. If the extension of bid validity is required, it should be sought from all bidders before stipulated expiration date (for valid bids only) and not from the lowest alone, and the Bank notified. The extension shall be made for the minimum period required to complete the evaluation. In the case of fixed price contract, if the award is delayed by a period exceeding 60 days beyond the expiry of the initial bid validity, the contract price will be adjusted by a factor specified in the request for extension. Bank’s prior concurrence is required if the extension is longer than 60 days beyond the original validity period.


16. In the case of prior-review contracts, the evaluation report and the recommendations for the award alongwith the comparative statement should be sent to the Bank for review and clearance before communicating the award of the contract.

Rejection of Bids

17. Regardless of value, if all bids are proposed to be rejected and the bids re to be re-invited, the Bank should be consulted before such action. The Bank does not favour negotiations.


18. In the case of the civil works, the system of rejecting bids outside a pre-determined margin or ‘bracket’ of prices should not be used without prior clearance with the Bank.


Sub-contracting

19. Sub-contracting proposals should be evaluated keeping in view the following:

- All bidders are expected to indicate clearly in the bid, if they proposed sub-contracting elements of the works amounting to more than 10% of the Bid Price. For each such proposal the qualification and the experience of the identified sub-contractor in the relevant field should be furnished alongwith the bid to enable the employer to satisfy himself about their qualifications before agreeing for such sub-contracting and include it in the contract.

- However sub-contracting for certain specialized elements of the work is not unusual and acceptable for carrying out the works more effectively; but vertical splitting of the work is not acceptable.


Construction Methodology

20. This should be evaluated for acceptability and got modified at the time of signing of agreement.

Performance Security

21. Performance security should be obtained for the prescribed amount and in an acceptable form in the currency of the contract in accordance with the conditions of the contract. Additional security should be taken to cover the risks of unbalanced bids in the case of civil works.


22. The performance security should normally remain valid as stipulated in the bidding document.

23. Failure of the successful bidder to sign the contract or furnish the performance security within the specified period shall constitute sufficient grounds for the annulment of the award and forfeiture of the bid security in which event the purchaser/ department may make the award to the next lowest evaluated bidder or call for new bids.


Enclosure VI

SUGGESTED FORMAT OF BID

EVALUATION REPORT FOR CIVIL WORKS (ICB)

1. Scope of contract and approximate cost:

- Outline brief description of works covered

by bid invitation.

- Compare project cost estimate with the actual cost of the proposed contract with explanations for difference.


2. Bidding document:

Furnish the following details and discuss in brief:

- Approval by World Bank/Government;

- Variations from the approved

document, if any;

- Specifications and drawings

(approval);

- Implementation schedule and

stipulated time for completion; and

- Important bidding conditions (in brief), such as, price adjustment, domestic preference, if any, etc. (Do not repeat them; briefly refer to them).

(Enclose copy of bidding document with amendments if any, if not sent earlier — Annex I)


3. Bid invitation process:

Furnish the following details and discuss:

- Date of publication of General and Specific Procurement Notice in U. N. Development Business *;

- Bid invitation advertisement in national newspapers and dates of publication * ;

- Date of issue of bid invitation to embassies *;

- Period in which the bidding documents were made available for sale;

- Number of bidders who purchased the bidding documents and their nationality;

- Date of closing and extensions, if any;

- Pre bid conference (dates, place and attendance), minutes of meeting and resulting amendments, if any; and


- Date and time of public bid opening, attendance, highlights of the bid opening meeting, etc.

(Enclose copies of Bid Invitation, Prebid minutes, copies of amendments issued, minutes of bid opening - Annexes II, III, IV and V)

* Where bidders are prequalified, the reference to Bank’s no objection to prequalification, no. of bidders prequalified, and the date of issue of bid invitation to them should be furnished.


4. Bid response:

- State number of offers received and the nationality.

- Furnish details of offers received:

Group: In time Late Total

Domestic

Others

___________________________________________

Total

- Comment on the response (too few, expected number, more than expected and reasons thereof)


- Convert bid prices to Rupees (indicate exchange rates used and source — Annex VI)

- Furnish table of bid prices as read out at the bid opening meeting and as converted:

Sl.No. Name of bidder

Nationality Bid price as quoted and read out

Bid Price in Rupees (local currency)

Remarks


5. Clarifications sought and responses received, if any after bid opening.

6. Preliminary examination of bids:

- Discuss preliminary examination for eligibility (ITB Clause 3), arithmetical errors, completeness, legal validity (has been properly signed and has submitted power of attorney etc.), bid validity, bid security and substantial responsiveness to commercial and technical aspects of bidding documents.

- List arithmetical errors and corrected bid prices.

- furnish details of all bids in Annexure VII.


- List the bids rejected as non responsive at this stage.

Sl. No. Name of bidder Bid price Brief reasons for rejection

7. Evaluation of substantially responsive bids:

- State evaluation criteria and methodology cross referencing to bid documents, assumptions made, if any in evaluation (Annex VIII).

- Discuss separately for domestic and other bidders conditions if any and loading of bid prices for accepted deviations for commercial and technical aspects.


- Prepare evaluation table showing the rankings in ascending order as under:

Group Name of Bidder

Rank Bid Price in Rupees(Local currency)

Evaluated bidPrice in Rupees(Local currency)

Domestic

Others

123

123

(Furnish details as in Annex IX)

- Discussion of offers:- Domestic bidders

* Other bidders* Domestic preference* Determination of lowest evaluated

responsive bid after taking into consideration domestic preference.


8. Postqualification/Verification for prequalified bidders:

- State criteria if any outlined in the bid document.

- Furnish actual qualification of selected bidder and determine whether the selected lowest evaluated responsive bidder is qualified to satisfactorily perform the contract.

- If the determination is negative, bid of the lowest bidder will have to be rejected and the next lowest evaluated bid considered to make a similar determination of bidder's capability to perform satisfactorily.

(Details in Annex X)


9. Construction Methodology:

- Discuss the proposed construction methodology and other details of the selected bidder [submitted by him in terms of Clause 5.3 of ITB] and comment on its acceptability.


10. Sub-Contracting:

- Comment on sub-contracting proposed and discuss qualification/experience of sub-contractors determining whether this is acceptable keeping in view

[i] All bidders are expected to indicate clearly in the bid, if they proposed sub-contracting elements of the works amounting to more than 10% of the Bid Price. For each such proposal the qualification and the experience of the identified sub-contractor in the relevant field should be furnished alongwith the bid to enable the employer to satisfy himself about their qualifications before agreeing for such sub-contracting and include it in the contract.

[ii]However, sub-contracting for certain specialized elements of the work is not unusual and acceptable for carrying out the works more effectively; but vertical splitting of the works for subcontracting is not acceptable.


11. Recommendations:

- Furnish important features of bid recommended for award such as:

- Advances- Price adjustments, if any- Performance security- Additional security proposed for

unbalanced bids, if any- Bid validity- Stipulated period of completion- Other important terms and conditions


12. Value of contract proposed for approval:

- Value of bid, currency wise

- Total value of the bid.

(Enclose contract information sheet of selected bidder — Annex XI)

Signature of Evaluating Officer

Approval of Competent Authority


Enclosures (enclose only those which were not forwarded earlier):

1. Copy of bidding document (Annex I)2. Copy of bid invitation and press

advertisement (Annex II)3. Prebid minutes (Annex III)4. Copies of amendments issued (Annex IV)5. Minutes of bid opening (Annex V)6. Currency exchange rate as published by

competent authority (Annex VI)7. Assessment of bids (Annex VII)8. Assumptions made in evaluation (Annex

VIII)9. Comparative Statement of Offers (Annex IX)10.Details of post-qualification/verification of

qualification for prequalified bidders (Annex X)

11.Contract information of selected bidder (Annex XI)


Annex VII/1

Assessment of Bids

Sl. No.

Particulars Bidder 1.................

Bidder 2.................

Bidder 3.................

Bidder 4.................

Bidder 5.................

1. Name of Bidder

2. Country of Origin

3. Classification(Group A / B)

4. Total Bid Price :(a) in Bid Currency/

Currencies

(b) in Indian Rupees after conversion

5. Credentials-----------------------Letter of Authorization

6. Commercial Assessment*

7. Technical Assessment*

8. Decision on Responsiveness

9. Capacity cum Capability* Assessment (Post / Pre Qualification)

* For details see attachment.


Annex VII/2

EVALUATION OF THE BIDS

Analysis for Responsiveness of Bid:

Sl. No.

Particulars and Clause Reference Name of Bidder 1

.................

Name of Bidder 2

.................

Name of Bidder 3

.................1. Validity of Bid ITB 16

2. Bid Security ITB 17

5.1 Form of Bid Security

5.2 Bank and Branch

5.3 Expiry Date

5.4 Amount

3. Letter of Authorization ITB 20.2

4. Bid Form ITB 13.1

5. Exceptions to Clauses, if any

6. Price Adjustment, if any ITB 14.4

7. Bid Currency ITB 15.1

8. Unbalanced bids, if any ITB 31.5

9. Technical Deviations, if any

10. Decision on Commercial Responsiveness

Note: Add parameters as required to suit the item under procurement and as specified in your bidding document.


Annex VIII

Brief details of Assumptions made in Evaluation

a)

b)

c)

d)


Annex IX

Comparative Statement of Offers

Sl.No.

Item of Bill of Quantities

Quantity Unit Estimate Bidder 1 Bidder 2

Rate in Rs.

Value in Rs.

Rate in Rs.

Value in Rs.

Rate in Rs.

Value in Rs.

Grand Total:


Annex X

Post Qualification

Criteria as specified in the bidding document*

Bidder 1 Bidder 2 Bidder 3

1.

2.

3.

4.

Note:1(*).List all criteria specified in the bidding document and give comments on how bidder meets or fails in criteria.

2. Give details for the recommended bidder and other lower bidders whose offer is evaluated as non-responsive / who have been determined as not meeting with this criteria.


Annex XI

Details of recommended offer

RUPEES FOREIGN CURRENCIES TOTAL IN

1................

2................

3................

RUPEES

1. Value of bid, currency-wise

2. Advances: Mobilization/Equipment

3. Interest on advance, if any

4. Performance Security

5. Additional Performance Security for Unbalanced bids, if any

6. Retention money

7. Milestones to be achieved

8. Liquidated damages for different milestones


Enclosure VII

SUGGESTED FORMAT OF BID EVALUATION REPORT FOR GOODS &

EQUIPMENT (ICB)

1. Scope of contract and approximate cost:

- Outline brief description of Goods and

Services covered by the bid invitation.

- Compare the project cost estimate with the actual cost of the proposed contract with explanation for difference.


2. Bidding document:

Briefly discuss and indicate:

- Details of approval by World Bank/ Government

- Variations from the approved document, if any

- Specifications (Approval reference, if any)

- Requirement of accessories/spares, if any

- Delivery requirements

- Important bidding conditions such as:

(Do not repeat the condition; briefly refer to them.)

* price adjustment

* loading for:

(a) delivery schedule(b) payment schedule(c) performance and productivity(d) operating and maintenance costs

- domestic preference

[Enclose copy of bidding documents and amendments if any, if not sent earlier (Annex I)]


3. Bid invitation process:

Furnish the following details:

- Date of publication of General and Specific Procurement Notice in UN Development Business

- Bid invitation advertisement in national News papers and dates of publication

- Date of issue of bid invitation to embassies

- Period in which the bidding documents were made available for sale

- Number of firms who purchased the bidding documents and their nationality

- Date of closing and extensions, if any

- Pre-bid conference (date, place and attendance), minutes of meeting and resulting amendments, if any; and

- Date and time of public bid opening, attendance, highlights of the bid opening meeting etc.

[Enclose copies of Bid Invitation, Prebid minutes, copy of amendments issued and minutes of bid opening (Annexes II, III, IV and V).]


4. Bid response:

- State number of offers received and the nationality

- Furnish details of offers received along with comments on bidder’s classification of bids :

Group In Time Late Total Comments

ABC

Total :

(Note: Group A & B Bidders should quote ex-factory, ex-showroom, ex-warehouse or Off-the-Shelf as applicable and not as partly CIF covering imported components and partly on ex-factory covering local costs. Group C Bidder can quote vice versa)


- Comment on the response (too few, expected number, more than expected, and reasons thereof)

- Convert bid prices to Indian Rupees (indicate exchange rates used and source — Annex VI)

- Furnish Table of bid prices as read out at bid opening (in ascending order):

Sl.No. Name of bidder

Nationality Bid price as quoted and read out

Bid Price in Rupees

Remarks


5. Clarifications sought and responses received, if any, after bid opening:

6. Preliminary examination of bids:

- Discuss preliminary examination for eligibility (ITB Clause 2), arithmetical errors, completeness, legal validity (has been properly signed and has submitted power of attorney etc.), bid validity, bid security and substantial responsiveness to commercial and technical aspects of bidding documents.

- List arithmetical errors and corrected bid prices

- List reservations if any of Group A bids to the note on deemed export benefits (Clause 11.2 of ITB) and discuss responsiveness of such offers.

- Furnish details of all bids in Annexure - VII.

- List the bids rejected as non-responsive at this stage.

Sl. No. Name of bidder Bid price Brief reasons


7. Evaluation of substantially responsive bids:

- State evaluation criteria, methodology cross referencing to bid documents, assumptions, if any, made in evaluation (Annex VIII).

- Discuss briefly offers and adjustments, if any:

Commercial aspects:

- omissions- inland transportation- delivery schedule- deviation in payment schedule- spare parts- operation and maintenance- performance and productivity etc.

Technical aspects:

- efficiency- productivity- training etc.


- Prepare evaluation table showing all adjustments and ranking as under:

Group Rank Name of bidder/ Manufacturer/ Agent

Evaluated For destination price in Rupees

A 123

B 123

C 123

(Details in Annex IX)


- Brief discussion of offers:

- Group AGroup BGroup C

- Determination of the lowest evaluated responsive bidder from Groups A and B.

- Discuss application of domestic preference with justification of domestic bids' eligibility for preference and the level of prevailing import duties on the goods.

- Determination of the lowest evaluated responsive bid from Groups A, B and C for award by taking into account domestic preference.


8. Post qualification:

- State criteria, if any, outlined in the bid document.

- Discuss actual qualification of selected bidder to demonstrate whether the selected lowest evaluated responsive bidder is qualified to satisfactorily perform the contract. (If the determination is negative, lowest bid will have to be rejected and the next lowest evaluated bid considered for a similar determination of bidder's capability to perform satisfactorily.)(Details in Annex X)


9. Recommendations:

- Furnish important features of recommended bid such as:

- Bidders name

- Model, quantity and total bid price for:

* basic machine* list of tools* list of special accessories* list of 2 years maintenance spares

Total: ____________ (in currency of bid)

- Source of origin

- Payment terms

- Agency commission

- Delivery

- Inspection


- Insurance

- Freight

- Performance security

- Specifications

- Other important terms and conditions

- Date of expiry of validity of the selected bid.

(Enclose contract information sheet of selected bidder, Annex XI)

Signature of Evaluating officer

Approval of competent Authority


Enclosures (enclose only those which were not forwarded earlier):

1. Copy of bidding document (Annex I)2. Copy of bid invitation and press

advertisement (Annex II)3. Prebid minutes (Annex III)4. Copies of amendments issued (Annex IV)5. Minutes of bid opening (Annex V)6. Currency exchange rate as published by

competent authority (Annex VI)7. Details of assessment of bids (Annex VII)8. Assumptions made in evaluation (Annex

VIII)9. Evaluated bid prices of offers (Annex IX)10.Details of post-qualification (Annex X)11.Contract information of selected bidder

(Annex XI)


Annex VII/1

Assessment of Bids

Sl. No. Particulars

Name of Bidder 1................

Name of Bidder 2................

Name of Bidder 3................

Name of Bidder 4...............

Name of Bidder 5................

1. Manufactured by

2. Country of Origin

3. Indian Agent

4. Classification(Group A / B / C)

5. Model Offered

6. Model Number

7. Total Bid Price and Currency

8. FOB Value / Ex-Works Currency

9. CIF Value in bid currency (foreign) and in

In Foreign Currency

Indian rupees In Indian Rupees

10. Cost per unit as per Bid Document in Indian Rupees

11. Credentials-----------------------Letter of Authorization

12. Commercial Assessment*

13. Technical Assessment*

14. Decision on Responsiveness

* For details see attachment.


Annex VII/2

EVALUATION OF THE BIDS

Commercial Analysis for Responsiveness of Bid:

Sl. No.

Particulars and Clause Reference Name of Bidder 1

.................

Name of Bidder 2...............

Name of Bidder 3...............

1. Model Offered

2. Model No.

3. Manufd. By

4. Country of Origin ITB 2

5. Bid Security ITB 15

5.1 Form of Bid Security

5.2 Bank and Branch

5.3 Expiry Date

5.4 Amount

6. Validity of Bid ITB 16

7. Letter of Authorization ITB 13.3(a)

8. Bid Form ITB 9.1

9. Exceptions to:

Delivery; ITB 26.5(b)

Payment Terms; and ITB 26.5(c)

Others

10. Bid Currency ITB 12

11. Performance Statement ITB 13.3(b)


Annex VII/3

Sl. No.

Particulars and Clause Reference

Name of Bidder 1

.....................

Name of Bidder 2

.....................

Name of Bidder 3

.....................

12. Decision on Commercial Responsiveness

Note: Add parameters as required to suit the item under procurement and as specified in your bidding document.


Annex VII/4

Technical Evaluation of the Bids :

Sl. No.

Particulars Technical Clause

Reference

Name of Bidder 1

.....................

Name of Bidder 2

.....................

Name of Bidder 3

.....................

1. Model No

2. Mfd. By

3. Model Type

4.

5.6.7.8.9.10.11.12.13.

14. Decision on Technical Responsiveness

1. List the mandatory and optional features which are checked and compared as detailed in your technical specifications to determine on conformity to technical specifications.

2. This should also cover all deviations listed by bidder in response to Clause 14.3 (c) of ITB.


Annex VIII

Brief details of Assumptions made in Evaluation

a)

b)

c)

d)


Annex IXPage 1 of 2

Comparative Statement of Responsive Offers

Items PriceBidder's Name Bidder's Name Bidder's Name

(Groups A and B separately)

Cost per unit (in Rs.)

1. Ex-factory/ ex-showroom/ ex-warehouse or Off-the-Shelf prices

2. Excise duty (if quoted separately)

3. Packing & forwarding charges

4. Inland freight

5. Insurance

6. Other charges, if any

TOTAL

7. Discounts, if any

8. Total unit cost as quoted

9. No. to be supplied

10. Total cost as quoted

11. Delivery period offered

12. Delivery period loading

13. Payment terms loading

14. Other loadings

15. Total evaluated price with loading

16. Ranking


Annex IXPage 2 of 2

Items Price Converted to Indian Rupees

Bidder’s Name and Country



Group C

Cost per unit (in Rs.)

1.

i)

a) CIF including agency commission as quoted per machine

b) Ex-factory price (for items supplied locally from India)

2. Port clearance & incidentals

3. Inland Freight

4. LC charges, if any

5. Other charges per unit, if any

TOTAL6. Discounts, if any

7. Total unit cost

8. No. to be supplied

9. Total cost

10. Delivery period offered

11. Delivery period loading

12. Payment term loading

13. Other loadings

14. Total evaluated price with loading

15. Loading for domestic preference [The amount of customs duty and other import taxes as applicable or 15% of 1 (a) above, whichever is lower]

16. Total evaluated price after loading for domestic preference

17. Ranking

Annex X

Post Qualification

Criteria as specified in the bidding document*

Bidder 1 Bidder 2 Bidder 3

1.

2.

3.

4.

Note:1(*).List all criteria specified in the bidding document and give comments on how bidder meets or fails in criteria.

2. Give details for the recommended bidder and other lower bidders whose offer is evaluated as non-responsive / who have been determined as not meeting with this criteria.


Annex XI

Details of Recommended Offer

Name of Bidder___________________________________________

Sl. No.

Name of Item Specification or Part No.

Unit Qty. Rate Value*

1. Basic item

2. List of Tools

3. List of special accessories and spares

4. List of spares for 2- year maintenance

5.

Total Cost*

* All values in Bid Currency

NR/ls Wednesday, July 23, 2003/tt/file_convert/5475ab98b4af9fae0a8b5c3b/document.doc
