New Delhi: The power ministry wants to adopt the so-called ultra mega power project, or UMPP, model to build hydropower projects in India, and has written to three states with high hydroelectricity potential to allocate one big site each for the purpose.
The UMPP model calls for creating special purpose vehicles—firms that work with state governments and local bodies to aquire land and obtain environmental and other clearances. These vehicles are then transferred to the successful bidder of the project.
“We have been asked to step up efforts to increase the hydropower capacity in the country and ultra mega hydropower projects are a step in that direction,” said a senior power ministry official who didn’t wish to be named.
Making room: The site of the Lower Subansiri hydel project, on the Assam-Arunachal Pradesh border. (Photo: Indranil Bhoumik / Mint)
The power ministry has written to Uttarakhand, Himachal Pradesh and Arunachal Pradesh, asking them to identify and allocate projects with a potential of over 500MW, to be awarded through the UMPP model. “The states have to come on board for the attempt to be successful, as nothing can be done without their co-operation,” the official said.
The role of the state government is critical as hydropower projects take a big toll on the environment, besides displacing local residents.
According to power ministry data, Arunachal Pradesh hydropower potential of around 50,328MW, and Himachal Pradesh and Uttarakhand have potentials of 20,376MW and 16,500MW, respectively.
Meanwhile, some power sector experts are sceptical about the efficacy of the move.
“It is a good concept but it will be a challenge to execute it,” said Shubhranshu Patnaik, an executive director at audit firm PricewaterhouseCoopers.
“Hydro projects are extremely site-specific and are not as modular as thermal projects. A huge amount of preparation is required. The detailed project reports need to be prepared upfront,” he said. “Unfortunately, this is not what the states have done at the time of awarding the hydropower projects.”
With the share of the hydropower generated in the country falling from 40% to 25% in the past 20 years, the government is worried, as the sector makes up only 32,000MW of the country’s 143,000MW power-generating capacity.
India is seeking to add 78,577MW of generating capacity in the next five years, and 16,553MW of that is expected to come from hydropower.
Several hydropower projects in the country have been delayed and India has met a little less than half the target of 14,393MW set for hydropower generation in the five years to 2007.
The UMPP model for the thermal sector has met with limited success, and of the 10 proposed projects only four are on track. The power ministry is now seeking political intervention from states where projects are stuck over suitability of sites, and has called for a meeting with chief ministers of Chhattisgarh, Maharashtra, Orissa, Tamil Nadu and Karnataka on 4 August, as reported by Mint on 27 July.