Hydel Policy To Allow 100% Equity For Ipps

The Union power ministry will soon announce the new hydel power policy whereby independent power producers (IPPs) will be allowed 100 per cent ownership and will also be allowed to form joint ventures for promoting hydel projects.

This was disclosed by power secretary EAS Sarma at a workshop on hydel power held here yesterday.

Elaborating on the proposed hydel policy, Sarma said that the government plans to follow an integrated hydel development plan under which one organisation would undertake development of projects along the associated river basins.

For this, the existing public sector undertakings will play a crucial role in the development of hydel projects, Sarma added.

Power minister R Kumaramangalam, who was also present at the workshop, said in his inaugural address that the government would concentrate on developing hydel projects.

Based on the low hydel-thermal mix, the minister said that the government needed to take the initiative to develop hydel projects. He added that the hydel sector would continue to be under the state sector as long as there was no mechanism to fully negate the unforeseen risks that crop up during the construction of the project.

According to the power secretary, the present hydro- thermal mix had declined from 50:50 to 25:75 over the last four decades.

In order to just maintain the same mix (25:75), Sarma said that the country needed to add around as much as 22,000 mw over the next 10 years.

Based on these estimates, Sarma said that the government would have to rope in private sector investments failing which the government would be unable to match the required investments. In this regard the proposed hydel policy would address the problems of unforeseen risks and would play a pivotal role in kick-starting the hydro-sector.

As bulk of the hydel potential is along the Himalayan belt, the country needed to adapt suitable technology to develop projects along this belt, Sarma elaborated. At present, the country has an estimated hydro potential of 84,000 mw out of which only 22,000 mw has been tapped.