Government Approves INR 12,461 Cr Support for 31,350 MW Hydro Electric Projects
The Union Cabinet has approved the modification of the scheme of budgetary support for the cost of enabling infrastructure for Hydro Electric Projects with a total outlay of INR 12461 crore to be implemented from FY 2024-25 to FY 2031-32.
September 12, 2024. By EI News Network
The Government of India has been taking several policy initiatives to address the issues impeding Hydro Power development, viz., remote locations, hilly areas, lack of infrastructure etc.
To promote the hydropower sector and to make it more viable, the government in March 2019, approved measures, namely declaring large hydropower projects as Renewable Energy sources, Hydro Power Purchase Obligations (HPOs), tariff rationalisation measures through escalating tariffs, budgetary support for flood moderation in storage HEP and budgetary support for the cost of enabling infrastructure, i.e., construction of roads and bridges.
For the faster development of Hydro Electric Projects and improvement of infrastructure in the remote project locations, the government has made some modifications to the earlier scheme.
The modified scheme has widened the ambit of the budgetary support for the cost of enabling Infrastructure by including four more items apart from the construction of roads and bridges.
Now, it will cover the cost incurred for the construction of the transmission line from the power house to the nearest pooling point including the upgradation of the pooling substation of State/Central Transmission Utility, ropeways, railway siding, and communication infrastructure. The strengthening of existing roads/bridges leading to the project will also be eligible for central assistance under this scheme.
The scheme has a total outlay of INR 12,461 crore for a cumulative generation capacity of about 31,350 MW to be implemented from FY 2024-25 to FY 2031-32.
The scheme will be applicable to all Hydro Power Projects of more than 25 MW capacity including the private sector projects which have been allotted on a transparent basis. This scheme will also be applicable to all Pumped Storage Projects (PSPs) including Captive/Merchant PSPs, provided that the project has been allotted on a transparent basis. A cumulative PSP capacity of about 15,000 MW would be supported under the scheme.
The projects whose Letter of Award of the first major package is issued up to June 30, 2028, would be considered under this scheme.
Further, the limit of budgetary support for the cost of enabling infrastructure has been rationalised to INR 1 crore/MW for projects up to 200 MW and INR 200 crore plus INR 0.75 crore per MW exceeding 200 MW, for projects above 200 MW.
Moreover, for exceptional cases the limit of budgetary support may go up to INR 1.5 crore/MW provided sufficient justification exists.
“The budgetary support for the cost of enabling infrastructure will be provided after appraisal of the cost of enabling infrastructure by the DIB/PIB and approval of the competent authority as per extant guidelines,” noted a statement released by the government.
This revised scheme is expected to speed up the development of hydro-electric projects and improve infrastructure in remote and hilly project locations. It would provide a large number of direct employment opportunities to the local people along with indirect employment/entrepreneurial opportunities through transportation, tourism, and small-scale business.
Above all, it would encourage fresh investments into the hydro power sector and incentivise the timely completion of new projects.
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