Hydro Power Generation: High Tariff, Green Clearances Trouble Sector

Hydro Power Generation: High Tariff, Green Clearances Trouble Sector

Huge time and cost overruns, high upfront cost to establish projects, long-drawn process to get green clearances, additional cess imposed by various state governments on projects, high tariff and reluctance of states to sign power purchase agreements (PPAs) are the some of the difficulties that are currently impeding the hydroelectric power development in the country, according to the Union power ministry.

The difficulties were listed by Archana Agrawal, joint secretary in the Ministry of Power, while giving a presentation on September 6 to R K Singh, who took charge as Minister of State (Independent Charge) for Power and Renewable Energy on September 5. According to the presentation, 18 hydro projects of 6.2 GW capacity are currently “stalled midway”. Currently, while 592 hydro projects of total 145.3 GW capacity have been allotted across the country, only 30.7 per cent of the projects have been completed as yet, according to the power ministry.

The first issue was about “huge time and cost overruns”. By giving the examples of four different hydro projects — Teesta L/D/ III, Nathpa Jhakri, Tehri and Koldam — the presentation stated: “Hydropower projects are getting completed at two or more times the sanctioned cost. (Moreover), hydropower projects are getting completed at double the sanctioned time.” According to the minutes of this meeting, Singh “desired framing of timelines for commissioning of all underconstruction projects”. Singh added that “these timelines should be justified and should be in bi-monthly blocks starting October 1, 2017”. Read More…

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