The government is considering incentives and certain concessions to hydroelectric power projects in Jammu & Kashmir that are currently at the exploratory stage, senior government officials told ET.
Through the initiatives, the Centre is seeking to make these projects economically viable and competitively priced, reflecting the Modi government’s aim to fast-track hydropower capacity in the union territory, the people said.
The deliberations are currently at a preliminary stage but have gathered pace since these projects are expected to play a crucial role in speeding up hydropower capacity in the region amid India’s decision to keep the Indus Water Treaty with Pakistan in ‘abeyance’.
“Discussions are going on, but nothing has been finalised yet. These could be given to projects whose tariffs are not coming to be viable,” one of the officials said.
The power ministry and NHPC did not respond to email queries. Jammu & Kashmir Power Department could not be immediately reached for a comment.
The union territory’s overall installed capacity is 3.4 GW, of which around 67% is owned by NHPC, according to Central Electricity Authority data.
State-owned NHPC, which operates 2.25 GW of projects in the region, is looking to speed up the exploration process of four additional hydropower projects totalling around 3 GW, one of the persons said. This is in addition to the 3 GW of projects under construction by the company in the region.
While NHPC projects that are operational are fully owned by it, the under-construction ones are in collaboration with Jammu and Kashmir State Power Development Corporation (JKSPDC).
The discussions are centred around offering free power to the union territory in a staggered manner, the people said.
The Centre’s grant to J&K for its equity share in joint ventures, if the projects go ahead with joint development, is also being discussed, the people said. Water cess waiver for a few years, and rebate on state GST are among other financial benefits being deliberated upon.
Similar incentives have been provided to NHPC’s four under-construction projects in the region, which are in a joint venture format with the union territory. For instance, in the Kwar Hydroelectric project—which is under development—a grant of Rs 616.30 crore has been given to JKSPDC from the Centre for the former’s 49% equity contribution. Grants for stakes in the other three under-construction projects have also been provided.
So far, NHPC has been preparing detailed project reports and techno-feasibility reports for four additional projects. These have now been accelerated. The power producer is exploring Uri-I stage-II of 240 MW, Dhulasti stage-II of 260 MW, Sawalkot of 1,856 MW, and Kirthai-II of 800 MW—either directly or through joint ventures.
“If today, the project is not viable, then we have to make it so, for which, you have to give the benefits. That discussion is going on,” another person said.
Through the initiatives, the Centre is seeking to make these projects economically viable and competitively priced, reflecting the Modi government’s aim to fast-track hydropower capacity in the union territory, the people said.
The deliberations are currently at a preliminary stage but have gathered pace since these projects are expected to play a crucial role in speeding up hydropower capacity in the region amid India’s decision to keep the Indus Water Treaty with Pakistan in ‘abeyance’.
“Discussions are going on, but nothing has been finalised yet. These could be given to projects whose tariffs are not coming to be viable,” one of the officials said.
The power ministry and NHPC did not respond to email queries. Jammu & Kashmir Power Department could not be immediately reached for a comment.
The union territory’s overall installed capacity is 3.4 GW, of which around 67% is owned by NHPC, according to Central Electricity Authority data.
State-owned NHPC, which operates 2.25 GW of projects in the region, is looking to speed up the exploration process of four additional hydropower projects totalling around 3 GW, one of the persons said. This is in addition to the 3 GW of projects under construction by the company in the region.
While NHPC projects that are operational are fully owned by it, the under-construction ones are in collaboration with Jammu and Kashmir State Power Development Corporation (JKSPDC).
The discussions are centred around offering free power to the union territory in a staggered manner, the people said.
The Centre’s grant to J&K for its equity share in joint ventures, if the projects go ahead with joint development, is also being discussed, the people said. Water cess waiver for a few years, and rebate on state GST are among other financial benefits being deliberated upon.
Similar incentives have been provided to NHPC’s four under-construction projects in the region, which are in a joint venture format with the union territory. For instance, in the Kwar Hydroelectric project—which is under development—a grant of Rs 616.30 crore has been given to JKSPDC from the Centre for the former’s 49% equity contribution. Grants for stakes in the other three under-construction projects have also been provided.
So far, NHPC has been preparing detailed project reports and techno-feasibility reports for four additional projects. These have now been accelerated. The power producer is exploring Uri-I stage-II of 240 MW, Dhulasti stage-II of 260 MW, Sawalkot of 1,856 MW, and Kirthai-II of 800 MW—either directly or through joint ventures.
“If today, the project is not viable, then we have to make it so, for which, you have to give the benefits. That discussion is going on,” another person said.
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