The ministry of power will soon move a Cabinet note seeking budgetary support to compensate NTPC Ltd for shutting down its Loharinag Pala hydro power plant in Uttarakhand on religious and environment grounds. Though the exact compensation for closing the project is yet to be ascertained, it is expected to be above Rs 2,000 crore.
If the government pays the state-run power major, it will be the first to get compensated for closing a project on religious and environment grounds.
Senior officials told Business Standard that the ministry would also seek a permission from the Cabinet to set up a technical advisory committee for the closure of the project. “The committee will not only decide on the compensation to NTPC but also the amount to be spent on making the site safe for future,” said a power ministry official.
On August 20 last year, the project became the first to be scrapped midway on religious grounds. Around 155 km stretch on the Bhagirathi, a tributary of Ganga, has been declared a no-dam zone by a group of ministers leading to scrapping of four projects, of which only the NTPC project had started construction.
NTPC had completed about 30 per cent of construction work — including 10-km excavation in the mountains for tunnelling and creating a desilting facility when construction was stopped on July 20, 2009. The expenditure on the project included some Rs 600 crore directly spent on construction besides the maintenance being currently undertaken to keep the tunnelled mountain stretches safe. The company had also tied itself to orders worth about Rs 2,000 crore for which it would need to compensate its contractors.
The technical committee would also advise on the ways to close the project. Unlike the man-made barrages and power houses that can be easily dismantled and broken, tunnels in mountains would need to be filled up. Mountains have natural water running through them and if left unattended, these streams can lead to dripping inside the tunnels and flooding, especially during monsoons. Currently, contractors hired by NTPC carry out dewatering exercise at the site.
On why the delay in seeking the Cabinet approval, the official said the decision of a group of ministers had to be routed through the Ganga River Basin Authority headed by the Prime Minister.
