PIB clears ₹26,070 crore investment for 1,720 MW hydro project in Arunachal

The Public Investment Board (PIB) on Thursday approved an expenditure of ₹26,069.50 crore for the proposed 1720 MW Kamala hydro project in Arunachal Pradesh, a source said.

The project will generate 6,869.92 MU of green energy annually on completion, thereby contributing to Government of India's energy transition initiatives and its Net Zero target by 2070, the source told PTI.

The Kamala hydroelectric project is a storage-based scheme with a flood moderation component, proposed on the Kamala River (a major tributary of the Subansiri River), located in Kamle, Kra Daadi and Kurung Kumey districts of Arunachal Pradesh.

The project involves construction of a 216-metre high concrete gravity dam and an underground powerhouse with a scheduled completion period of 8 years.

 

In addition to power generation, the project also envisages to provide flood relief in the Brahmaputra valley.

The project will be implemented on Build-Own-Operate-Transfer (BOOT) basis through a joint venture with 74 per cent equity with NHPC and 26 per cent owned by Government of Arunachal Pradesh (GoAP).

The completion cost of the project is estimated at ₹26,069.50 crore, including IDC and financing charges of ₹4,815.64 crore.

The project is proposed to be financed with a debt-equity ratio of 70:30, supported by Government of India grants for enabling infrastructure (Rs 1,340 crore) and flood moderation component (Rs 4,743.98 crore), along with 100 per cent SGST reimbursement by GoAP.

Considering these aspects, the levelized tariff of the project is ₹5.97/unit.

Key benefits from the project include flood moderation in the Brahmaputra basin, 12 per cent free power to GoAP, yielding about ₹486 crore annually, contribution of ₹40 crore per year to Local Area Development Fund (LADF).

The project will also lead to regional infrastructure development, and significant employment generation (about 300 direct jobs and 2,500 contract workers during peak construction period).

Besides, the state government will earn a first-year return of about ₹127 crore on the ₹750 crore Central Financial Assistance (CFA) included in its 26 per cent equity contribution.

The source also said that the power ministry has given in-principle approval for ₹3,000 crore expenditure for testing facilities across the country.