Reports Hydropower Devt India Hydropower Devt India

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    Hydropower

    Developmentin IndiaA Sector Assessment

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    Hydropower Development n Inda: A Sector Assessmentv

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    A Sector Assessment

    K. Ramanathan

    P. Abeygunawardena

    Hydropower

    Developmentin India

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    Hydropower Development in India: A Sector Assessmentii

    2007 Asian Development Bank

    All rights reserved. Published 2007.

    Printed in the Philippines.

    Cataloging-In-Publication Data

    Publication Stock No. 031607

    Asian Development Bank.

    Reference document on hydropower development in India

    1. India 2. Hydropower development

    The views expressed in this book are those of the authors and do not necessarily reflect the views

    and policies of the Asian Development Bank (ADB) or its Board of Governors or the governments

    they represent.

    ADB does not guarantee the accuracy of the data included in this publication and accepts no re-

    sponsibility for any consequence of their use.

    Use of the term country does not imply any judgment by the authors or ADB as to the legal or

    other status of any territorial entity.

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    Contents

    Acronyms and Abbrevatons v

    Preface v

    Executve Summary x

    I Introducton 1

    II Overvew of Indan Power Sector 3

    III Plans for Future Power Development 5

    IV Hydropower Development n Inda 8

    V Strateges for Accelerated Hydropower Development 12

    VI Prvate Sector Partcpaton 17

    VII The Small Hydro Segment 20

    VIII Energy Securty Issues and Regonal Cooperaton n Hydropower Development 24

    IX Conclusons 27

    Appendxes 29

    A Breakdown of Installed Generaton Capacty n Utltes 29

    B Lst of Low Tarff Schemes under 50,000 MW Hydroelectrc Intatves 30

    C Requrements for Obtanng Clearances and Approvals 32

    D Regulatory and Tarff-related Issues n Hydropower Generaton 40

    E Draft Gudelnes for Allocaton of Hydrostes to Prvate Developers 43

    F Hydropower Development n Uttaranchal 49

    G Hydropower Development n Hmachal Pradesh 55

    H Hydropower Development n Skkm 61

    I Hydropower Development n North-Eastern Regon 65

    References 70

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    Hydropower Development n Inda: A Sector Assessmentv

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    v

    Acronyms and Abbreviations

    CAMPA Compensatory Afforestaton Fund Management and Plannng Authorty

    CAT catchment area treatment

    CCEA Cabnet Commttee on Economc Affars

    CEA Central Electrcty Authorty

    CERC Central Electrcty Regulatory Commsson

    CPIB Commttee of Publc Investment Board

    CPSU central power sector unt

    CNG compressed natural gas

    CWC Central Water Commsson

    DPR detaled project report

    EA Electrcty Act 2003

    EIA envronmental mpact assessment

    EMP envronmental management plan

    EPS Electrc Power Survey

    FI fnancal nsttuton

    GDP gross domestc product

    HP Hmachal Pradesh

    HPERC Hmachal Pradesh Electrcty Regulatory Commsson

    HPSEB Hmachal Pradesh State Electrcty BoardIPP ndependent power producer

    JPVL Japrakash Power Venture Lmted

    LADA local area development authorty

    LNG lquefed natural gas

    MNES Mnstry of Non-Conventonal Energy Resources

    MOEF Mnstry of Envronment and Forests

    MOF Mnstry of Fnance

    MOP Mnstry of Power

    MORD Mnstry of Rural Development

    MOU memorandum of understandng

    NEA Nepal Electrcty Authorty

    NEEPCO North-Eastern Electrc Power CorporatonNHDC Narmada Hydro Development Corporaton

    NHPC Natonal Hydroelectrc Power Corporaton

    NTPC Natonal Thermal Power Corporaton

    NPV net present value

    NPRR 2003 Natonal Polcy on Resettlement and Rehabltaton, 2003

    NEP Natonal Electrcty Plan 2005

    NER North-Easthern Regon

    PAF Project-affected famly

    PFC Power Fnance Corporaton

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    Hydropower Development n Inda: A Sector Assessmentv

    PIB Publc Investment Board

    PFR prefeasblty report

    PGCIL Power Grd Corporaton of Inda Lmted

    RFP request for proposal

    R&R resettlement and rehabltaton

    SEB state electrcty board

    SHP small hydro project

    SEIAA state/unon terrtory envronmental mpact assessment authorty

    SEAC state/unon terrtory level expert apprasal commttee

    SERC state electrcty regulatory commsson

    SJVNL Satluj Jal Vdyut Ngam Lmted

    SPCB state polluton control board

    SPDCL Skkm Power Development Corporaton Lmted

    THDC Tehr Hydro Development Corporaton

    TEC techno-economc clearance

    THPA Tala Hydro-electrc Project Authorty

    TOR terms of referenceUERC Uttaranchal Electrcty Regulatory Commsson

    UPCL Uttaranchal Power Corporaton Ltd.

    UTPCC Unon Terrtory Polluton Control Board

    WEIGHTS and MEASURES

    BU (bllon unt) Unt of energy, equal to 1x109

    kWh (klowatt-hour) Unt of energy, equal to 1 unt

    MW (megawatt) Unt of power, equal to 1x106

    GW (ggawatt) Unt of power, equal to 1 bllon (109) watts

    MT (metrc ton) Unt of weght, equal to 1,000 kg or 2,204.6 pounds

    CONVERSION

    Rs1 mllon Equal to Rs1x106

    Rs1 bllon Equal to Rs1x109

    Rs1 lakh Equal to Rs1x105

    Rs1 crore Equal to Rs1x107

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    v

    Preface

    Ths report s ntended to be a reference document for varous partes nvolved n hydropower de-

    velopment n Inda. It provdes an assessment of the hydropower development potental n Inda.

    Although the report s somewhat techncal n nature, t should be of nterest to the Government,

    nongovernment organzatons, and cvl socety n general. The report would serve ts purpose ft helps to renforce publc awareness and concern to make the Indan energy sector more dverse

    and sustanable.

    Energy securty s a major concern n many of our developng member countres. Inda

    s no dfferent to ths. In order to mantan the requred power demand-supply balance and to

    meet ts goal of Power For All by 2012, Inda needs to nstall an addtonal 100,000MW power

    generatng capacty. Ths s a major challenge and we hope Indas vast hydropower potental can

    contrbute to ths n an envronmentally sustanable and socally responsble manner. In ths report,

    an assessment has been made to understand the hydropower potental. A sgnfcant contrbuton

    from hydropower resources to meet the emergng needs of the power sector seems techncally

    feasble and cost-effectve.

    The Energy Dvson of South Asa Regonal Department prepared ths report n collaboraton

    wth the Energy and Resources Insttute, New Delh, Inda. I wsh to convey my sncere apprecatonto the authors for brngng out ths report at ths juncture.

    Kuno Senga

    Drector General

    South Asa Regonal Department

    Asan Development Bank

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    Hydropower Development n Inda: A Sector Assessmentv

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    x

    Executive Summary

    A fast growng power sector s crucal to sustan Indas economc growth. Inda has an assessed

    hydropower potental to the tune of 84,000 MW at 60% load factor; out of ths only about 20%

    has been developed so far. In the past varous factors such as the dearth of adequately nvest-

    gated projects, envronmental concerns, resettlement and rehabltaton ssues, land acqustonproblems, regulatory ssues, long clearance and approval procedures, power evacuaton problems,

    the dearth of good contractors, and n some cases, nter-state ssues and law and order problems

    have contrbuted to the slow pace of hydropower development. There have been large tme and

    cost overruns n case of some projects due to geologcal surprses, resettlement and rehabltaton

    ssues, etc. However, consderng the large potental and the ntrnsc characterstcs of hydropower

    n promotng the countrys energy securty and flexblty n system operaton, the Government s

    keen to accelerate hydropower development.

    Most of the above concerns are beng addressed through a number of legslatve and

    polcy ntatves at the central and state levels. As dscussed n detal n the report, these nclude

    preparaton of a shelf of well-nvestgated projects and streamlnng of statutory clearances and

    approvals, establshment of ndependent regulatory commssons, provson for long-term fnancng

    for projects, ncreased flexblty n sale of power, etc. In May 2003, the Prme Mnster of Indalaunched a 50,000 megawatt (MW) hydro ntatve. Under ths scheme, detaled project reports

    (DPRs) are beng prepared for 73 schemes, whch have an ndcatve frst year tarff below Rs2.50.

    Ths would provde a shelf of farly well nvestgated low tarff projects to prospectve developers.

    Rsk perceptons n takng up the projects and the possbltes of tme and cost overruns are also

    expected to get mnmzed. Of these schemes (total about 32,000 MW), 70 are located n the

    Brahmaputra, Indus and Ganga basns n the north and north-eastern part of the country.

    The Government has formulated a number of measures to address the