Hydropower, SHP Update

August 16, 2016 1:39 am0 commentsViews: 291

hydro power

Hydro-power is a crucial component in the country’s energy mix as it also helps reduce the country’s carbon footprint, says R Srinivasan.

As per Central Electricity Authority’s (CEA) assessment, India is endowed with economically exploitable hydro-power potential to the tune of 148,700 MW of installed capacity. In addition, hydro-potential from small, mini and micro schemes has been estimated as 6,782 MW from 1,512 sites. As per reports, as on 31 March 2016, the present installed capacity is 42,783 MW and 4,274 MW of small hydro power (SHP) units have been installed.

Despite hydroelectric projects being recognised as the most economic and preferred source of electricity, the current hydro share in the energy mix has fallen to around 15% from around 46% in the 1960s. Also as per CEA data in June the renewable energy sector has for the first time, helped by policy initiatives and early stage private investments in solar and wind power, surpassed hydro-power generation. Even worldwide, where over 20% of the world’s electricity is generated by using hydro-power, the theoretical potential of hydro-power is about four times greater than the amount that has been tapped. Yet, the actual amount of electricity that will ever be generated by hydro-power will be much lower than the theoretical potential due to environmental concerns and economic constraints.

Asked to comment on India’s hydro potential, in view of the fall in the share of hydro (from 46% earlier) in the country’s electricity basket and what measures would help overcome the current untapped hydro potential, Bruno Godin, Business Leader, Hydro India, GE Renewable Energy, said, “The share of hydro has declined rapidly in the recent past owing to various bottlenecks that have hindered the growth of this segment. With the total exploitable hydro potential pegged at 150,000 MW, India is currently ranked fifth in the world in terms of usable potential. To tap this huge potential of hydro-power, it is critical for the country to draw out transparent and clear cut policies that leave no scope for ambiguity or misinterpretation.

Land acquisition is one of the biggest challenges and a model guideline for land policies that facilitates streamlined clearances and speedier project implementation needs to be put in place. Hydropower projects are also capital intensive; they require high upfront costs to address greater complexities in design, engineering, social impact mitigation, etc.

To address this challenge, State governments should consider deferment of free power share in the initial years for repayment of the loan period, when project developers face maximum repayment strain and provide higher depreciation in early years to enable developers to meet their repayment obligations. National Clean Energy Fund (NCEF) should also be explored as a new and sustainable source of funding for hydro-power projects.

The exploitation of hydro potential has not been up to the desired level due to constraints such as non-availability of long-term financing, inaccessibility of certain areas, problems due to delays in land acquisition, environmental concerns, inadequate technical and financial capability of developers, rehabilitation and resettlement (R&R) issues, delays in procuring clearance and approvals, delays due to protests that lead to time and cost overruns, etc. Also construction and operation of hydro-power dams can affect the riverine systems as well as fish and wildlife populations. In this context, research by the University of Stirling in UK (May 2016) found that reservoir islands created by large hydropower dams, considered akin to sanctuaries to protect animal and plant species, actually undergo sustained losses every year.

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