Financial Daily from THE HINDU group of publications
Wednesday, May 24, 2006
Financial Daily from THE HINDU group of publications Wednesday, May 24, 2006 |
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Industry & Economy
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Power Centre favours SPV model for hydro power projects Our Bureau
New Delhi , May 23 The Centre has called for the use of the special purpose vehicles (SPV) model by State Governments and implementing agencies for expeditious development of large hydroelectric power projects in the country. The `Guidelines for development of hydro electric projects', issued by the Ministry of Power today, envisage the SPVs working independently to reach a stage where major tie-ups, statutory clearances and linkages are in place for project construction to take off.
Guidelines
The guidelines call for the need to build storage reservoirs as India's per capita storage capacity for water is among the lowest in the world. "There is a need to build such reservoirs in the upper reaches of the rivers before they enter the plains as suitable sites are mostly on the hills," it said, adding that the guidelines for large storage reservoir multi purpose hydro projects, having live storage capacity of over 30 days, should only be taken up by private sector players through memorandum of understanding with Government or public sector agencies. The guidelines suggest the selection of project developers should be done on the basis of tariff-based bidding. In a bid to push through private sector participation, the guidelines stress on the need for Government intervention to tie up transmission requirements for privately developed projects, along with assistance in obtaining environmental and other statutory clearances and also co-ordination with power purchasers. Also, in order to meet the concerns of financial institutions, the policy calls for adequate payment security mechanisms and booking of transmission corridors.
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