16-year delays, 2,532% cost overruns shock House panel

16-year delays, 2,532% cost overruns shock House panel
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First Published: Thu, Apr 12 2007. 04 56 AM IST
Updated: Thu, Apr 12 2007. 04 56 AM IST
In a scathing assessment of India’s attempts at building up its power-generation capacity, a parliamentary committee on energy has disclosed that the country’s hydroelectric projects have cost 388% to 2,532% more than originally estimated.
The committee, chaired by Gurudas Kamat, a member of the ruling Congress Party, also said that some of the projects have taken nine to 16 additional years to be completed.
Such delays are among the reasons the government has fallen short of its ambitious plans to add power capacity.
For instance, 35%, or 14,393 Megawatts (MW) of the 41,110MW of new capacity that was to be created in the five years from 2002 to 2007 was supposed to come from hydro projects. But only 7,886MW, or just over half of the planned additions, have come online.
This is significant because India’s thermal power capacity addition plans have already faltered in the past. Meanwhile, of the 76,460MW that is now being targeted over the next five years, through 2012, hydroelectric power projects are supposed to contribute over a fifth, or 21%, of planned capacity.
The committee also blames the power ministry for the long delays. “The committee is surprised to note that, in spite of all the measures, there have been abnormal delays in the execution of some hydro projects...The committee is inclined to believe that proper assessment of certain foreseeable factors, such as (those relating to) geology and funds, is not done with due seriousness and recommends the ministry to take adequate steps in that direction.”
While the average lead time of a new hydroelectric power project is around five years, the projects have been hampered due to reasons as varied as delays in investment decisions, contractual problems, land acquisition problems, geological surprises and natural calamities, such as floods.
The committee specifically pointed to the 388 % cost overrun for the 1500MW Satluj Jal Vidyut Nigam Ltd Nathpa Jhakri project. The National Hydroelectric Power Corp.’s 390MW Dulhasti project saw a cost overrun that amounted to a whopping 2,532%.
It took Nathpa Jhakri nine years to be completed, while Dulhasti was commissioned this year, 16 years after it was originally scheduled to be commissioned.
Other projects that have been delayed include Sardar Sarovar Narmada Nigam Ltd’s 1400MW project on Narmada, NHPC’s 280mw Dhauliganga project and Assam State Electricity Board’s 100 MW Karbi Langpi project.
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First Published: Thu, Apr 12 2007. 04 56 AM IST