The Union Cabinet has approved modifications to the existing scheme of Budgetary Support for infrastructure development in Hydro Electric Projects (HEP). These changes aim to accelerate HEP development and enhance infrastructure in remote, hilly areas.
Scheme Overview
Launched in 2019 by the Ministry of Power, the scheme initially provided budgetary support for building roads and bridges connecting project components like dams and powerhouses to highways. The revised scheme now includes:
Funding: ₹12,461 crore for projects generating a combined 31,350 MW.
Expansion: Support for constructing transmission lines, ropeways, railway sidings, and communication infrastructure, along with roads and bridges.
Eligibility: Applicable to HEPs over 25 MW, including private projects and Pumped Storage Projects (PSPs).
Additional Measures
Large Hydro Power as Renewable Energy: Large hydroelectric projects with capacities greater than 25 MW are now classified as renewable energy sources, supporting India's green energy transition.
Hydro Power Purchase Obligations (HPOs): These obligations mandate that entities must purchase electricity generated from HEPs, promoting the use of hydropower in the energy mix.
Tariff Rationalization: Steps have been taken to lower the tariffs for hydropower, making it more affordable for consumers.
Flood Moderation: Budgetary support is also being provided to help manage floods by utilizing storage hydropower projects.
Key Challenges
While the modification of the scheme is a positive step forward, HEPs continue to face several challenges:
Financial Constraints: Hydroelectric projects are capital-intensive and require substantial upfront investment, often posing financial hurdles.
Geological Issues: Projects located in hilly areas, especially in the Himalayas, face significant geological challenges during construction.
Power Evacuation Problems: Due to their remote locations, evacuating power from these projects remains a complex issue, often requiring additional infrastructure.
Social and Environmental Concerns: Land acquisition and rehabilitation for large-scale hydro projects often lead to social resistance and displacement issues.
Conclusion
The Cabinet’s approval of the modified scheme marks a significant step towards boosting India’s hydropower capacity, improving project infrastructure, and addressing challenges in this crucial sector.
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