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									  Hydro Development -
The Challenges and Response


            R.V. SHAHI
                             ICOLD Conference
            SECRETARY
                             Montreal (Canada)
        MINISTRY OF POWER
                                 June 20, 2003
       GOVERNMENT OF INDIA
                                             1
       Share in generation - Global scenario
                  1973                                            2000

                   Nuclear
          Gas                    Hydro                   Gas                  Nuclear
                    3.3%
         12.1%                   21.0%            Oil   17.4%                 16.9%
                                                 7.9%
 Oil
                                     Others **
24.7%                                                                                   Hydro
                                       0.7%
                                                                                        17.1%
                                                                                  Others **
                                                          Coal                      1.6%
                        Coal                             39.1%
                       38.2%

              6,121 TWh                                         15,379 TWh
          ** Other includes geothermal, solar, wind, combustible renewables & waste

   •    Hydro share has reduced from 21% to 17.1%
   •    Nuclear share increase significant from 3.3% to 16.9%
                                                                                                2
 Hydro Potential - Global Scenario
  Only 18% of hydro potential utilised in India




                                                         310000
            Potential (MW)
            Installed capacity (MW)
           % Potential utilized
        58%




                                        170000
                       160000




                                                                          150000
                                41%
                                                 31%
                                                                  18%
                                65678




                                                                  56000
                                                 52427
                                                                                   18%
47000

        27360




                                                                                   27010
Norway                 Canada             Brazil          China              India
                                                                                           3
Power Supply position in India

            Power Shortages (%)         Peak Shortages (%)

       20.5
                           18.0

                                          13.0               12.2
                    11.5
                                  7.8                  8.8
 7.3




  1992-93            1996-97      2000-01              2002-03



                                                                    4
       Hydro development : Rationale


          54%      60%
                                    71%       75%
Fuel
Mix


          46%      40%
                                    29%       25%

           '70     '80               '90      2003
                   Years

                 Hydro     Thermal + Others

                                                     5
                      Thrust on hydro

 Consistent shortages caused emphasis on short lead projects

    •   Increase in thermal proportion

        -   Abundant coal reserves / shorter project lead /
            lesser R&R problems

•   Still shorter lead of gas projects caused emphasis off the longer
    lead hydro projects

•   Nuclear also developed as reliable mode of thermal generation




                                                                          6
                                                              Contd…...
                      Thrust on hydro                         Contd…...




 Despite      best   efforts   during   planning   stage,   the   hydro
    development constrained due to longer gestation construction
    period

•   environmental constraints

•   rehabilitation & resettlement problems

•   inadequate investigations :

    -   geological / hydrological surprises



                                                                           7
                                                              Contd…...
                    Thrust on hydro                    Contd…...



 Turnaround now in hydro development
•   Government of India committed quantum jump in financial
    allocations
•   Varied facilitating measures undertaken


# Added during last twenty years              - 13,666 MW
    To add during five years (2002-07)        - 14,393 MW




                                                                   8
                                                       Contd…...
                     Thrust on hydro                         Contd…...



 Hydro the preferred source
•   Clean power       - no pollution ramifications during operation
•   Most cost effective option, free from inflation linked to fuel
    consumption
•   Effective tool for load management - to counter large variations
    between peak and off peak requirements and frequency variations
•   Supports and supplements socio economic development of the
    region
    -   hydro potential mostly in areas which need substantial support
        for economic development
•   Integrated solution for power, drinking water and irrigation

                                                                         9
      Initiatives on hydro development
Policy on hydro development by Government of India :
 Ensuring higher capacity addition through :
  •    Enhanced Central Sector outlay
  •    Advance Action plan for next ten years
 Exploitation of untapped hydroelectric potential
  •    Ranking Studies
  •    Basin wise Action Plan
  •    Preparation of feasibility studies and DPRs
       -     50,000 MW hydro initiative



                                                                  10
                                                       Contd...
                                                          Contd…...



 Promoting small and mini hydel projects
  •   25 MW and below fall under ‘non conventional’ category -
      qualify for benefits


 Tariff dispensation
  •   Rationalization of hydro tariff by allowing premium on sale rate
      during peak period
  •   CERC has approved 5% hydro development surcharge on
      annual fixed charges for Central hydro stations



                                                                      11
                                                           Contd...
                                                            Contd…...


 Facilitating and expediting measures undertaken
  •   Three stage clearance procedure for Central Sector/ Joint
      ventures
  •   Simplified clearances further liberalized by Electricity Act, 2003
  •   Resolution of inter State issues on sharing of water and power
  •   Support for land acquisition, R&R, Catchment Area Treatment
  •   Emphasis on quality of Survey and Investigations
  •   Renovation, Modernization & Uprating of existing stations




                                                                        12
 Hydro development - the process

       Potential
      assessed                         150,000 MW
 (845 Schemes)

 Ranking Study
of unharnessed
        R anking St ud y          107,000 MW
   399 schemes


Hydro Initiative
(162 schemes)              50,000 MW


                                                    13
    50,000 MW Hydroelectric Initiative

   162 schemes identified with installed capacity of
    50,560 MW located in sixteen States

   Initiative launched in May 2003

   Consultants identified to undertake Feasibility Studies

•   Preparation of Preliminary
    Feasibility Reports        - Dec.’03 - Sep.’04



                                                                14
                                                     Contd...
50,000 MW Hydroelectric ……..                          Contd…...

 Detailed Project Reports      - Jan.’04 - Jan.’06

    for promising projects, depending on PFRs results
    • DPR preparation also through reputed International
      Consultants
    • Process of selection of Consultants for DPR of large
      projects through ICB
    Clearances / sanctions   - Sep.’04 - Jul. ‘06


    Implementation           - 2007 - 2017

                                                              15
      Major Challenges and Response
Environment protection

 Comprehensive legislation in place with well laid out principles
  and guidelines

 Environment Impact Assessment (EIA) studies carried out to
  evaluate pre and post construction scenarios

 Minimum use of forest area and close monitoring to ensure
  efficient implementation of EMPs

  •   Plan to create Forest Banks for compensatory afforestation




                                                                     16
                                                          Contd...
                                                        Contd…...



Rehabilitation and resettlement

  Lessons learnt from past - greater synthesis now between project
  developers, affected persons and authorities

 A national R&R policy being contemplated

 In parallel Ministry of Power has stepped up coordinated efforts
  with local / state authorities

  •   Project specific monitoring mechanism put in place to ensure
      implementation of R&R plans




                                                                     17
                                                         Contd...
                                                          Contd…...

Safety of Dams
 Built up considerable knowledge base from global experience
 A few Institutions in the country have also geared up - hardware/
                                                         software
 Experts of repute from across the countries consulted for studies
  and guidance


Reliability of Investigations
 Technological / procedural improvements in
  Survey & Investigations
   •   State of Art equipment / technology
   •   Consultation with Experts - a continuous process
                                                                      18
                                                           Contd...
                                                         Contd…...


Multiple agencies’ clearances
The players :
   M/o • Power
      • Environment & Forest
      • Water Resources / Central Water Commission
 Continuous process of improvement
 Procedures streamlined
 Speedy clearances
 System of regular Inter Ministerial reviews in force




                                                                     19
                                                          Contd...
                                                              Contd…...


Compressing Construction cycle
 Construction management
  •    Construction lead reduced - 4 to 5 years
  •    Clearance / approval period reduced by 18 to 24 months with
       Three stage clearance procedure
 Construction technology
  •    Choice of technology
       -   mitigate the geological / hydrological surprises
       -   faster implementation



                                                                          20
                                                               Contd...
                                                         Contd…...



Communication
Consensus arrived through regular consultation process
  •    Political consensus
  •    Public awareness
  •    Media support




                                                                     21
                                                          Contd...
Opportunities in Indian hydroelectric sector

 Hydro Capacity addition target :

   2002-07           -       14,000 MW

   2007-17           -       50,000 MW

  Detailed investigations and preparation of DPRs

  EPC contracts for development of projects

  Package contracts in other projects

  Investment as equity partner / J.V. opportunities

  Funding for the project

                                                       22
 Major concern, so long, of the investors
   -   Poor financial health and creditworthiness of the Sector :


   Distribution Reforms, the key confidence indicator


 Electricity Act, 2003 notified      and A.P.D.R.P. scheme
  introduced by Government of India :
   Distribution business to become commercially viable within
   next 3 to 5 years

 Competitive Environment, Power Trading
   Hydro as inexpensive power more viable
                                                                    23
Thank you
    Ministry of Power
         Website
  http://powermin.nic.in

                           24

								
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