The Himachal Pradesh government plans to invite bids for at least 15 hydro power projects in the current financial year. The projects will have a total capacity of around 3,000 megawatt (Mw), and will be awarded on a competitive bidding basis.
This bonanza will, however, benefit only private companies. “Public sector undertakings will not be able to bid for these projects. They are governed by the National Hydro Power policy regime,” Principal Secretary-Power Deepak Sanan told Business Standard.
This means state-run companies like NHPC and Sutlej Jal Vidyut Nigam will not be able to bid, leaving the turf open to private companies. Private entities like JP Hydro and Bhilwara Energy are seasoned players in hydro power and are already developing projects in the state. It is also expected that private majors like Tata Power, Reliance Power, GMR and GVK, which have large presence in the country’s hydro power sector, will line up for bidding for these projects.
These projects offer a huge upside to companies, as they will be able to sell 40 per cent of the power on a merchant basis, at market rates, and the remaining 60 per cent at regulated rates to the state government.
According to the present rules, state-owned companies cannot sell merchant power.
“However, according to the new Central Electricity Regulatory Commission (CERC) rules, all these projects have to bid out on a competitive basis by 2011. There is a hydro task force meeting which will meet and I hope they allow state-owned power companies will be allowed to participate in such projects to provide a level playing field,” said Sanan.
Himachal Pradesh has the highest hydro power capacity among the Himalayan states, with an operational capacity of 6,500 Mw. Around 3,200 Mw capacity will be commissioned in the next two years. The state plans to add another 7,500 Mw by 2012, the final year of the 12th Five-Year Plan period.
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The state government has played a key role in utilising the rich hydro power resources of the hill state. “We have a total hydro power potential of 23,000 Mw in our state. We have allocated 20,000 Mw of this capacity by either preparing project reports or constructing or commissioning such capacity.” said Sanan.
Uttarakhand, another Himalayan state, is yet to allocate at least half its hydro power potential. Sikkim too is yet to allocate a major portion of its capacity.