Chief Minister Jairam Thakur said that the Centre had taken the decision to add power generated by hydel projects (HPO) in the non-solar renewable purchase obligations to states and Union Territories. This ruling will give a boost to the hydro power sector in Himachal, he added. Funds would also be granted for infrastructure like bridges and roads near hydel projects.
The Chief Minister said, “Tariff rationalization will provide flexibility to developers and will increase project life to 40 years.”
Previously, hydro projects up to 25 MW capacity were deemed to be renewables and were suitable for many incentives like monetary assistance and cheaper credit. With the government’s latest decision, hydro-projects generating more than 25 MW can also make use of these advantages.
"Union Cabinet approves a slew of measures to promote hydro power sector," an official statement said.
In addition, the Cabinet decision may also add hydro generation of about 45 GW to the present 74 GW which includes solar, wind and small hydro. The goal is to have 175 GW of renewable energy by 2022 and with the inclusion of large hydro to clean energy segments, India will be ready with 225 GW of renewable energy by 2022.
At the moment, hydro power tariff is costlier than other means of generating electricity. These decisions will help to rationalise rates by hydro power projects.