Major policy and regulatory reforms are needed to revive the hydropower sector and meet ambitious targets in power generation and infrastructure, says a PwC report.
Hydropower will play a crucial role in India's sustainable development and energy security, the report said, added that policy and regulatory framework are key to realising India's potential in the area.
"For the government to meet the ambitious targets in power generation and infrastructure, among others, and ensure that India's growth story maintains momentum, expeditious hydropower development is needed, given its abundant potential of 148 GW," Yogesh Daruka, Partner Energy & Utilities PwC said.
An assessment shows almost 75 per cent of the total potential is concentrated in the North-East and North region. However, only 7 per cent of the total potential of the North-East region has been tapped.
Despite the government's plans to add capacity, actual additional has been marginal as against the target set. In the 11th Five Year Plan, only 40 per cent of the target was met and in the 12th Five Year Plan only one-third of the target has been achieved during the first two-thirds of this period.
Land acquisition remains one of the biggest challenges causing delay in the implementation of major infrastructural projects.
"Some amendments proposed in the New Land Acquisition Bill, 2015, such as those on consent of landowner and social impact assessment (SIA), in order to address the land acquisition problem from the perspective of both landowners and developers could be pivotal in the development of the sector," the PwC-Assocham report titled Hydropower@Crossroads added.
Another major roadblock faced by the sector is financing where new financing avenues need to be developed along with sufficient support from the government to attract investment.
Government intervention with respect to streamlining processes and building a sustainable business environment by offering fiscal incentives, creating new financing avenues and enabling infrastructure will be critical to the success of the sector, the report noted.
