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Business News/ News / India/  Scheme for mini hydro projects in the works

New Delhi: The Centre is planning to start a programme to support small hydro power projects in the country.

Currently, there is no programme to support the sector in India. Bhupinder Singh Bhalla, secretary, Union ministry of new and renewable energy said an initial draft has been prepared for a scheme.

“We want to come out with a new scheme for small hydro. It is still under planning. There was a scheme till 2017, but there has been no scheme since then. We have not had a scheme for small hydro for a long time. An initial draft has been prepared and it still under consideration," he said.

The secretary however said that no decision have been made yet on the support required for small hydro projects.

“We think there is a need to support the small hydro sector. I think the support is required but what kind of support and at what level, how soon, these are yet to be answered," Bhalla said.

Hydro power plants of 25 MW or below are classified as small, and they come under the purview of the ministry of new and renewable energy (MNRE).

Currently, the installed capacity of small hydro power projects is 4.9 GW, which accounts for 1.2% of the total power capacity. India has an estimated potential of 21.1 GW from 7,133 sites for power generation from small and mini hydro projects, according to the Hydro and Renewable Energy Department (HRED), of IIT Roorkee.

Hilly states including Arunachal Pradesh, Himachal Pradesh, Jammu & Kashmir and Uttarakhand constitute around half of this potential. Other potential states are Maharashtra, Chhattisgarh, Karnataka and Kerala.

Focused attention is required for these states through close interaction, monitoring of projects and reviewing policy environment to attract private sector investments, .

Other locations of identified small hydro project sites include Andhra Pradesh, Assam, Bihar, Chhattisgarh, Goa, Gujarat, Haryana, Jharkhand, Karnataka, Kerala, Madhya Pradesh, Maharashtra among others.

The secretary said that the government is looking at the policy approach for wind energy, with a renewed focus on offshore wind. The government is looking at ways to make the bidding process for offshore wind transparent through the policy changes.

“Now the policy will be changed slightly. Its for wind sector as a whole...Offshore is highly capital intensive, that has to be seen through a different prism. We have to figure out how to do transparent bidding in the offshore wind," he said.

Government came up with the National Offshore Wind Policy in 2016. Under the new approach, government plans to provide viability gap funding to attract investments in offshore projects.

Last month, the ministry announced that the government will invite bids for 8 GW of wind power projects annually till 2030 through a new bidding process. Centre has also done away with the reverse bidding method, and would now go for a ‘single stage two envelope closed bid’ process.

The push for offshore wind energy comes on the back of the slow progress in the segment over the years despite the government coming up with a dedicated policy in 2016.

The focus on small hydro and offshore wind gains momentum also because of the government’s aim to achieve 500 GW of installed renewable energy capacity by 2030. The installed capacity of wind energy in the country stands at 41.93 GW, which is 10.2% of the total power capacity.

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Rituraj Baruah
Rituraj Baruah is a senior correspondent at Mint, reporting on housing, urban affairs, small businesses and energy. He has reported on diverse sectors over the last six years including, commodities and stocks market, insolvency and real estate. He has previous stints at Cogencis Information Services, Indo-Asian News Service (IANS) and Inc42.
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Updated: 08 Feb 2023, 12:10 AM IST
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