Cabinet clears ₹2,585 crore scheme for small hydro power projects

Scheme aims to add 1,500 MW capacity and attract ₹15,000 crore investment while supporting states and improving grid reliability and clean energy output

The Union Cabinet on Wednesday approved a scheme for small hydro power plants with a total outlay of ₹2,585 crore for five years ending 2031. The scheme, applicable to plants with less than 25 megawatt capacity, will help set up 1,500 MW capacity projects and also attract a total investment of ₹15,000 crore, the Union Cabinet said in a statement.

 

The scheme provides for financial assistance of ₹30 crore for each project in North Eastern States and districts with international borders, capped at ₹3.6 crore per MW or 30 per cent of the project cost, whichever is lower. 

For other states, the Centre will provide financial assistance of ₹20 crore per project, capped at ₹2.4 crore per MW or 20 per cent of the project cost, whichever is lower. 

 

The scheme will also support states and Central government agencies to prepare detailed project reports for nearly 200 projects, for which an amount of ₹30 crore has been allocated. It is expected to enhance grid reliability and achieve carbon emission reduction of 4.3 million tonnes per annum.

 

Small hydro power plants do not require dam construction or environment clearance, provide power in remote areas, and have a project life of more than 40 years. India currently has a small hydro power capacity of 5,100 MW at 1,196 sites.

 

However, the potential is enormous, with a scope of 21,000 MW capacity that can be set up at 7,133 sites across states.