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Small hydropower projects in Arunachal Pradesh are facing delays in execution with some being stalled for almost a decade.
In all, there are nearly 140 hydropower projects (large and small) in the State stuck in the long development period that were allotted after policies came out in 2007-2008.
The delay has also been prolonged due to regulatory changes from the Ministry of Environment and Forests, including the introduction of Basin study, which mandates that the entire river should be studied as a whole before proceeding with a project.
State Commissioner (Power and Finance) Ashish Kundra told BusinessLine that the Arunachal Pradesh is going to take a fresh look at the prevailing hydropower policy.
“The Chief Minister is the minister in-charge of hydropower and is keen to give it a fresh impetus. There is a list of 10 large projects which have been identified in conjunction with Ministry of Power which are tracked regularly but we will have to find innovative solutions to over come the challenges of financial closure,” he said.
There are 95 allotted small hydropower projects with capacities of less than 100 MW in the State.
Of these, 17 have been in the works since 2007 with some yet to receive the Central Electricity Authority of India’s techno economic clearance.
The projects are under various stages of clearances with just 21 having reached the Detailed Project Report stage.
Arunachal Pradesh alone has 50,328 MW of the country’s total 148,701 MW identified hydropower potential above 25 MW, according to the Central Electricity Authority as of January 31 this year.
Of this, only 405 MW has been identified as capacity under operation, while 2,854 MW has been categorised as capacity under construction.
State Hydropower Development Agency officials say that project developers have been shying away from developing projects after initial commitments. There have also been constraints on achieving financial closure for projects that were envisaged with higher tariff commitments as power distribution companies are not looking to sign power purchase agreements.
The Union government had categorised Small Hydropower projects as a priority sector and was looking to declare projects less than 100 MW as renewable energy projects.
Currently, small hydropower projects less than 25 MW are eligible for benefits for renewable energy that include cheap financing and a promised assured off-take of power.
A small hydropower project developer said, “In most countries hydropower is categorised differently. Unlike other renewable energy sources, this acts as a base load. We will be waiting to see how the hydropower policy shapes up.”
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