As a special measure to address the rise inpowerproject costs due to the Covid-19 pandemic, the finance department has permitted the electricity department to acceptcostescalations from the contractor as long as it does not exceed10%of the original amount. The finance department said that if cost escalations exceed the expendituresanctionby more than 10%, a revised expenditure sanction will have to be sought from the finance department.
However, cost escalations will be permitted only if the cost of the project is more than Rs 2 crore and if the time frame for project completion is more than four months.
The relaxation and delegation of powers to accept revised expenditure sanctions comes based on recommendations of a special committee constituted by the to study the shortage of labour and non-availability of material as a result of the lockdown and the restrictions thereafter, due to the increase in Covid-19.