Dams · DRP News Bulletin

DRP News Bulletin 04 July 2016 (In Proposed Hydro Policy, Govt Unjustifiably Pushing Hydro Through Subsidies)

New Hydro Policy: Govt unjustifiably pushing hydro through subsidies A comprehensive policy to promote hydropower generation is set to be announced by September—with viability gap funding for projects, compulsory hydropower purchase obligations for distribution companies and a set of good practices that states have to follow. The idea is to address factors that currently drive hydropower costs up way above those of other sources of power and give policy support in its market development, according to a government official, who asked not to be named. The policy being prepared by the power ministry will have provisions for viability gap funding, which will help in meeting the shortfall in project costs and reducing hydroelectricity tariffs for consumers. Hydropower is expensive and in some cases more than double the cost of power from coal-based thermal plants, which is available at Rs.3-5 per unit.The ministry will also expand the scope of power distribution companies’ renewable power purchase obligations to include hydropower from projects with a capacity greater than 25 Mw. At the moment only power from those with less than 25MW is considered renewable power. According to officials, compulsory hydropower purchase from large projects will either be made part of the existing renewable power purchase obligation of distribution companies or a separate requirement, so that its inclusion does not affect the market for other renewable sources of energy like wind, solar or biomass. Govt unjustifiably pushing hydro through subsidies in proposed new hydro policy can be lead story. It is not going to help push hydro.   Continue reading “DRP News Bulletin 04 July 2016 (In Proposed Hydro Policy, Govt Unjustifiably Pushing Hydro Through Subsidies)”