Odisha seeks Rs 2,963 crore from NCEF for pump storage projects

Chief Minister Naveen Patnaik has demanded Rs 2,963 crore from the National Clean Energy Fund (NCEF) for funding three pump storage projects in Odisha.

The projects in question — Upper Indravati, Balimela and Upper Kolab with a combined capacity of 1,320 Mw, are estimated to cost Rs 3,950 crore.

"Of the above projects, detailed project report (DPR) in respect of 600 Mw pump storage scheme of Upper Indravati hydro electric project is under preparation by WAPCOS. It is requested that financial assistance to the tune of 75 per cent of the estimated cost of each pump storage project may be provided form the NCEF to bring down the cost of power from these projects in order to make the tariff affordable," Patnaik said in his letter to Prime Minister Narendra Modi.

 

Patnaik said while coal bearing states bear the brunt of the negative externalities of pit head coal-based power plants, some other states have the locational advantage of harnessing renewable energy. He suggested that coal bearing states should be assigned reasonably lower limits for the Renewable Purchase Obligation (RPO).

Renewable energy projects in projects need to be funded from NCEF and hydro electric projects having installed capacity of more than 25 Mw, especially the pump storage projects may also be considered as renewable energy projects. These projects, Patnaik felt, would help tremendously in meeting the peak demand of power and also in balancing the grid.

Though the rate of royalty on coal has not been revised for the past four years, the central government has enhanced the clean environment cess on coal from Rs 200 to Rs 400 per tonne in 2016-17 Budget. Proceeds of this cess would accrue to the NCEF earmarked for development of renewable energy. Since, the cess is collected from the coal bearing states, Patnaik had earlier demanded that 60 per cent of the proceeds need to be shared with such host states through an appropriate mechanism.