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A PROJECT REPORT
                             OF
            Energy and Environment Management
                            ON
                     Land Resources




SUBMITTED TO:-                           SUBMITTED BY:-

                                         Ashish Porwal
Dr. Rudra Rameshwar                      Anuj Saini
                                         Nitin Jain
                                         Shubhra Bhugra
                                         Sonali Gambhir




                                                          1
ABSTRACT



Hydro Power Project may be used as one of the option for achieving the energy
targets in a developing country like India where center or state Governments have
limited financial resources to put in large projects which require long gestation
period. One additional advantage with the Small Hydro Power.
        Project is that private partners may get attracted due to low investment and
quicker return in comparison to large projects. The last but not least is the most eco
friendliness of small power projects which is a point
of serious concern in case of thermal, or nuclear or sometimes in big Hydro power
projects depending upon the location of the projects. Small Hydro Power potential
in India is still under-utilized and there is need to tap this potential for optimum
utilization of natural resources.
       In Madhya Pradesh, Small hydro plants are not many , however there is
good scope for developing such plants. Tawa is one of such plants in MP, which
has been developed as canal head powerhouse on the left bank canal (LBC) of
Tawa irrigation project by a private investor. This plant is working in a very
efficient manner addressing both the power and irrigation aspects successfully.
This example will attract the private investments in small hydropower sector in the
developing countries like India.




                                                                                    2
ACKNOWLEDGEMENT




The success of any research study depends upon a number of factors among which
the proper guidance from the experts in the industry and a faculty plays an
important role. We would like to express our heartfelt thanks to many people. This
Project is an effort to contribute towards achieving the desired objectives. In doing
so, we have optimized all available resources and made use of some external
resources, the interplay of which, over a period of time, led to the attainment of
the set goals. We take here a great opportunity to express our sincere and deep
sense of gratitude to   Dr. Rudra Rameshwar for giving us an opportunity to
work on this project. The support & guidance from Sir, was of great help & it was
extremely valuable. We express our sincere thanks to all the people who, directly
or indirectly, contributed in time, energy and knowledge to this effort.




                                                                                   3
TABLE OF CONTENTS:


   Abstract

   Acknowledgement

   Introduction

   History Of Hydropower

   Hydropower In India

   Hydroelectric Projects Development: CHALLENGES


       Low Exploitation of Hydro Potential

       Power Shortage in India

       Declining proportion of Hydro Capacity

       Thrust on Hydro Power

       Govt. of India Initiative on Hydro Power Development

   Current issues/ problems with Hydropower in India

   Major challenges and responses

   Opportunities in Indian hydroelectric sector

   Conclusion




                                                               4
INTRODUCTION


Hydropower is a renewable, non-polluting and environment friendly source of
energy. It is perhaps the oldest energy technique known to mankind for conversion
of mechanical energy into electrical energy. Hydropower represents use of water
resources towards inflation free energy due to absence of fuel cost. Hydropower
contributes around 22 % of the world electricity supply generated. The total
potential of small Hydropower of the whole world is 780,000 MW out of which
50,000 MW has already been utilized.
      Small Hydro is also the highest density resources in generation of electricity
due to the reason of being it environment friendly, flexibility in operation and
suitability in giving support in peak time to the local grid. Due to the small
gestation period, small capital investment and quicker return involved, in recent
years it has become the point of attraction for private sector. Fiscal incentive
announced by the central and state Governments time to time for investment in this
sector have further caused private investor to give attention to this sector.
     Small hydro power plants (SHP) provide maximum benefits in minimum
time. And offers the most fastest economical means to enhance power supply,
improve living standards, stimulate industrial growth and enhance agriculture with
the least environmental impact and without heavy transmission losses .Due to less
transmission losses there is a reduction in distribution cost as well. Its availability
at the head of the irrigation canals and small streams is also a one of the added
advantage of it.




                                                                                     5
HISTORY OF HYDROPOWER


The first hydroelectric power dam in the world was built in Appleton, Wisconsin in
1982. In India, Jamshed ji Tata built the first hydroelectric power dam in the
Western Ghats of Maharashtra in the early 1900s to supply clean power to
Bombay’s Cotton and Textile Mills. He took the British Government’s permission
to build dams, namely the Andhra, Sirowata, Valvan and Mulshi hydel dams in the
Western Ghats to generate electricity using high rainfalls in the hills as storage
areas.
         Humans have been harnessing water to perform work for thousands of
years. The Greeks used water wheels for grinding wheat into flour more than 2,000
years ago. Besides grinding flour, the power of the water was used to saw wood
and power textile mills and manufacturing plants. For more than a century, the
technology for using falling water to create hydroelectricity has existed. The
evolution of the modern hydropower turbine began in the mid-1700s when a
French hydraulic and military engineer, Bernard Forest de Belidor wrote
Architecture Hydraulique. In this four volume work, he described using a vertical-
axis versus a horizontal-axis machine. During the 1700s and 1800s, water turbine
development continued. In1880, a brush arc light dynamo driven by a water
turbine was used to provide theatre and storefront lighting in Grand Rapids,
Michigan; and in 1881, a brush dynamo connected to a turbine in a flour mill
provided street lighting at Niagara Falls, New York. These two projects used
direct-current technology.




                                                                                 6
Hydropower In India



With the liberalization of the economy, the Government of India has been
encouraging and invited private sector for investment in the power sector.
Accordingly, a conducive policy environment has been created by modifying the
Electricity Act. The new Electricity Act-2003 deals with the laws relating to
generation, transmission, distribution, trading and use of electricity. The Act has
specific provisions for the promotion of renewable energy including hydropower
and cogeneration. It has been made mandatory that every state regulatory
commission would specify a percentage of electricity to be purchased from
renewable by a distribution licensee. The National Electricity Policy announced in
2005 aims at access of electricity by all households and per capita availability of
electricity to be increased to 1000 units by 2012. The Policy underlines that
renewable energy potential needs to be exploited and private sector would be
encouraged through suitable promotional measures. Regarding fixing of tariff, the
government has announced Tariff
Policy in 2006 wherein the State Regulatory Commissions are required to fix tariff
in their respective state and also decide about the renewable purchase obligation.
The Electricity Act and Tariff Policy are favorably tilted towards increasing power
generation from renewable. Now, Central Electricity Regulatory Commission has
also announced the tariff calculation guidelines for renewable technologies
including for small hydro projects.
        The existing power deficit and a rapid growing demand coupled with
government commitment to provide access to electricity for all has necessitated a
large scale capacity addition program. A capacity addition of 78,000 MW in the

                                                                                  7
11th Plan (2007 to 2012) and approximately one 100,000 MW in the 12th Plan
(2012-2017) is planned. Concurrent investments in Transmission and Distribution
are also going on. Such a gigantic task is strongly supported and complemented by
the private sector.
These changes facilitated the removals of barriers to investment, improved the
functioning of the system and resulted in additional generation of power much in
excess of that achieved in the earlier plans. Ministry of New & Renewable Energy
(MNRE) Government of India is the nodal ministry for small hydropower
development in India.




                                                                               8
 HYDROELECTRIC PROJECTS DEVELOPMENT: CHALLENGES


   Enhancing the level of energy consumption, particularly in less
    developed and developing countries, is a global challenge. 20% of world
    population living in industrialized countries consume 60% of energy and
    remaining 80% of population have to manage within 40% of total energy.
    This has obviously resulted in wide disparities between the standard of
    living and quality of life of high energy consuming countries on the one
    hand and those who do not have the opportunities of adequate access to
    energy on the other.    It is precisely for this reason that development of
    different sources of energy and increase in its consumption has become a
    priority agenda of all the developing countries.




 Various countries have adopted their own strategies to provide energy to
    their people. In the context of electric power, as an important form of
    energy, the thermal    and hydroelectric power on a global basis, have
    occupied the largest proportion. Within the thermal group, coal based
    power stations occupy dominant position.           However, this varies from
    country to country. The Gas based combined cycle power stations in
    number of countries occupy a significant proportion. Similarly, nuclear
    power stations have also increased and have been adding large amount
    of capacity to the thermal group. During last 30 years, Hydroelectric
    power generation has, as a matter of fact, reduced from 21% in 1973 to
    less than 17% in 2000. During the same period, coal based generation
    marginally increased from 38% to 39%, gas increased substantially from
    12% to 17.4% and nuclear witnessed a very steep rise from 3.3% to
    16.9%. Obviously concerted efforts are required to develop Hydroelectric
    capacities.

                                                                               9
 Low Exploitation of Hydro Potential :


      Inspite of hydroelectric power requiring a clean energy generation process,
exploitation of Hydroelectric potential in various countries has been rather on a
lower side.
:
     Power Shortage in India:
In India, though over 100,000 MW of capacity has been added in last 50
years, there is a huge gap between the demand and supply of power. While
in the last few years it has marginally reduced, the peaking shortage
continues to be over 12% to 13% and the average energy shortage at about
8.8%. Indian power system has an installed capacity of 108,207 MW in May
2003, with hydroelectric accounting for 25%.




     Declining proportion of Hydro Capacity:


In the last 30 years, the proportion of hydroelectric capacity in the Indian
power system has considerably reduced. It has dropped from about 46% in
1970 to 40% in 1980, 29% in 1990 and now 25% in 2003. In spite of the
Hydroelectric potential, which is now estimated to be of the order of 150,000
MW, the exploitation has been of the order of 27,000 MW. Some of the



                                                                               10
important reasons for decline in the Hydroelectric proportion in the total
capacity over the last 30 years are as follows:


a)    Indian power supply industry has always experienced the situation of
      shortages both in energy and peaking requirements. To tide over the
      shortage in shortest possible time, more dependence was placed on
      sources of power generation with shorter gestation period. Obviously
      this short-term approach rather than a long-term perspective led to this
      problem.
b)    With abundant coal reserves in the country, large capacity additions
      through coal based pithead power stations during the eighties and
      nineties increased the thermal proportion.
c)    Emergence of gas based combined cycle power stations based on
      indigenous natural    gas with gestation period of 2-2 ½ years also
      received priority in response to the anxiety to create capacity addition
      in shortest possible time.
d)    Nuclear power stations have also emerged as reliable modes of thermal
      generation.
e)    In spite of best efforts at the stage of planning and formulating projects
      in the hydro segment, a number of large projects got into long gestation
      period of construction on account of various reasons, namely
      environmental issues, rehabilitation & resettlement (R&R) problems,
      gap between investigations and field realities, etc.     We do have a
      number of successful stories on the hydroelectric projects but we also
      have large projects which have taken several years to get completed.

                                                                              11
   Thrust on Hydro Power:

In the recent years, the Govt. of India has committed quantum jump, in the
financial allocation and also by way of other supports so that Hydroelectric
projects not only get right priorities but also contribute in an increased way to
the future capacity addition programs of the country. Accordingly, in the 10th
Five-Year Plan (year 2002-2007), the target for hydroelectric capacity has
been placed 14,393 MW, which is more than the total installed capacity
(13,666 MW) created in the last 20 years. The thrust on hydroelectric
development is based on the following considerations:
a)       Hydroelectric involves a clean process of power generation. Once the
         projects are constructed, there is no pollution ramification unlike many
         other power generation technologies and processes.
b)       Since it does not suffer from the limitation of inflation on account of
         fuel consumption, in the long run, it is the most cost-effective option
         for power supply. In Indian context, where more than 45% of Indian
         population has yet to have access to electricity at an affordable price,
         this is an important consideration.
c)       Indian power supply system has a peculiar limitation of huge variation
         between peak and off peak requirements. Management of peak load in
         an effective manner could be conveniently handled through availability
         of hydroelectric support. The system at present does suffer from large
         frequency variations. Better hydro support could address this problem
         better.
                                                                               12
d)     Locations of Hydroelectric projects in India are also in areas which
       need substantial support for their economic development. These areas
       are North-east, Uttaranchal, Himachal Pradesh & Jammu & Kashmir
       where more than 80% of potential exists. Developing projects in these
       areas will spur economic activities and will lead to overall economic
       development.
e)     In an integrated Hydroelectric project – there are many such projects –
       the schemes involve not only supply of electricity but also provision of
       drinking water and irrigation. These are important issues in many parts
       of India. Hydroelectric projects, in many cases, do have the ability to
       mitigate these problems.
f)     Flood control is also an issue and quite often a challenge. Integrated
       hydroelectric projects could adequately address this concern.




      Govt. of India Initiative on Hydro Power Development:


The main features of the Government of India policy on hydro power
development are as follows:
            Additional budgetary financial support for ongoing and new
             hydro projects under Central Public Sector Undertakings.
            Basin-wise development of hydro potential – comprehensive
             Ranking studies for 399 schemes.


                                                                             13
   Advance action for capacity addition – 10 year ahead of
    execution
   Emphasis on quality of survey & investigations
   Resolution of inter-state issues on sharing of water and power.
   Renovation, Modernization & Uprating of existing hydro stations
   Promoting small and mini hydel projects – 25 MW and below
    now fall into category of “non-conventional” qualifying for
    benefits.
   Simplified procedures for clearances by Central Electricity
    Authority; Electricity Act 2003 further liberalizes this.
   Rationalization of hydro tariff by allowing premium on sale rate
    during peak period
   Realistic estimates of completion cost considering new
    development on geological front during execution.
   Promoting hydel projects in joint venture
   Selection of developer through MOU/Bidding route
   Govt.       support    for   land   acquisition,   resettlement   and
    rehabilitation, catchment area development, etc.


   Some of the measures announced by; Govt. of India have already
    been introduced which include simplified procedures for transfer
    of techno-economic clearances, streamlining of clearance process
    and     introduction    of   three-stage   clearance   approach   for



                                                                       14
development of hydro projects in Central Sector/Joint Ventures,
        etc.



       The Central Electricity Regulatory Commission has approved 5%
        hydro development surcharge on annual fixed charges for central
        hydro power generation.




 National policy on Hydropower in India:


 With the aim to accelerate the development of Hydropower, the
  Ministry of Power (MoP), Government of India (GoI) introduced the
  National Policy on Hydropower Development in 1998. The policy
  document has identified and responded to the major issues and barriers.


 With Central, State and Private hydropower projects contributing 3455
  MW, 5810 and 550 MW respectively, the GoI aims to reach the total
  capacity of 9815 MW during the ninth plan. (The XI th Plan aims
  capacity addition of 18781 MW in the hydropower sector)


                                                                       15
 Exploitation of vast Hydro Electric potential at faster pace:


 The government would take steps like execution of all CEA cleared
  projects, update and clear pending DPRs, survey new green field sites
  and resolve inter-state disputes.
 Promotion of small and mini hydro projects
 Small and mini hydro projects are especially viable for remote and hilly
  areas where extension of grid system is comparatively uneconomical
 Strengthening the role of PSUs and SEBs in taking up new hydro
  projects
 The government aims at enlarging Public sector’s involvement in mega
  hydro projects and multi-purpose projects involving inter-state issues,
  projects for peaking power and those with rehabilitation and
  resettlement issues.
 Increasing private investments for development of hydropower in India
 The public sector would be supported by greater private investment
  through IPPs and joint ventures. Private sector participation is
  considered vital for large scale development of hydropower.
 Through these measures, GoI aims to realize 100% hydropower
  potential of the country by year 2025-26. These objectives have been
  developed in response to the following constraints:
 Technical, including difficult investigation, inadequacies in tunneling
  methods)
 Financial (deficiencies in providing long term finance)
                                                                        16
 Tariff related issues
   Managerial weakness (poor contract management)
   Geological surprises (especially in the Himalayan region where
     underground tunneling is required)
   Inaccessibility of the area
   Problems due to delay in land acquisition and resettlement of project
     affected families
   Law and order problem in militant infested areas.


   Current issues/ problems with Hydropower in India:


The Government of India set up a National Committee in 1987 and a
Standing Committee in 1998 to oversee the progress on hydropower
development.
This section derives largely from the report submitted by the Standing
Committee on Energy (2005-06) - Hydro power: a Critique which discusses
the actions taken by the Government on the recommendations made by the
Committee in the forty second report on hydro power in India.


   Technical issues:
To expedite early execution of hydro projects, bankable Detailed Project
Report (DPR) based on detailed survey should be prepared to avoid
geological uncertainties. Survey & investigation and analysis of geological,
geo-morphological, geo-electrical, hydrological data etc. should be done at
the time of preparation of a DPR itself in order to minimize the impact of
                                                                          17
risks. It is, therefore, necessary to expedite survey and investigations with the
latest state of the art technology and prepare a shelf of projects for execution.
The quality of DPRs should be of high standard which should infuse
confidence in the national/international developers to take up the execution of
projects without loosing time in rechecks etc at the same time, contract
monitoring as distinct from project monitoring should be emphasized and
land acquisition and infrastructure development be settled and completed
before the start of the project.
Renovation and Modernization (R&M) has been recognized world over as a
well    proven      cost     effective     technique   for    improving      the
performance/efficiency of older power plants. The useful life of the plants
can be increased by R&M and the plants yield benefits in the shortest
possible time at a reasonable cost. GoI in its policy on hydropower
development, 1998 has laid stress on need for renovation and modernization
of hydro power plants. Contingency Plan for Hydro Projects affected by
Natural Calamities need to be prepared and made public. National Policy on
Rehabilitation and Resettlement (R&R) should be finalized and made public.


    Infrastructural issues:
There is a need to setup single window clearance for hydro projects. Various
authorities such as the Central Electricity Authority (CEA), the Ministry of
Finance, Ministry of Environment and Forests, etc. are involved in the
appraisal of a hydro power project before it is certified for development. It
will be desirable to have a single window dispensation/authority so that a
project is cleared without many hassles.
                                                                               18
The hydro projects which involve lesser risk element and entail lesser capital
investment can be considered for development in the Private Sector. Public
Sector can take up (a) Multi purpose Projects (b) Projects Involving inter-
State issues and in inter-State river systems, (c) Projects involving
cooperation with neighboring countries and (d) Projects for complementary
peaking with regional benefits (e) Projects in the North-Eastern Region etc.


    Financial issues:


There is also a need to off-load indirect cost components on hydro project.
Many hydro projects are located in troubled areas and infested by militancy
and terrorist activities. There is an urgent need to amend the present policy of
the Government in regard to charging the entire security expenditure from
concept and until commissioning - on the project cost. However, the
recurring expenditure incurred on security, once a project goes on stream
could to be charged on the project developer.
The cost of access roads should not be included in the project cost, as
development of hydro projects triggers economic and commercial activities
around the project site and results in economic benefit to the State. Inclusion
of R&R, flood moderation costs, along with the provision of 12% free power
to the State in the capital cost of the project needed reconsideration as the
provision did not apply to thermal power projects.




                                                                               19
 Major challenges and responses:


Development of Hydroelectric projects has thrown up a number of important
challenges, the world over and particularly in Indian context. Over a period
of time, experiences have been acquired and India is responding to these
challenges in the following manner.
     a)    Impact on Environment: Hydroelectric projects do create
           environmental issues emanating from sub-emergence of large
           areas also involving forest.      The Govt. of India has a
           comprehensive legislation on environmental issues and based on
           this legislation, there are well laid down principles and
           guidelines.    Environment Impact Assessment studies when
           properly carried out throw up the tasks to be undertaken by the
           project development agencies.      Ministry of Environment &
           Forest is working on a plan to create Forest Bank which would
           entail creation of huge afforestation with funding from project
           development agencies in advance so that this issue could be
           adequately responded.        The mechanism of compensatory
           afforestation through the Forest Bank will enable quicker
           clearances of projects.


     b)    Rehabilitation & Resettlement (R&R) of Project Affected People
           (PAP) is another major issue affecting the smooth execution of

                                                                          20
Hydroelectric projects particularly where in submergence areas,
     the number of project affected people are large.


c)   Another issue of concern is in relation to safety of dams. Here
     again, experiences from some of the very large projects of the
     country have led to considerable amount of knowledge base and
     it is expected that in future projects, studies and findings on dam
     safety could provide much higher degree of confidence. Some of
     the Indian institutions have equipped themselves both with
     hardware and software to properly address these concerns. Where
     required, project development agencies do depend on expertise
     available anywhere in the world for in depth studies and
     guidance.


d)   In view of complexity in development of Hydroelectric projects,
     particularly   large   ones,   emanating    from    dam     height,
     submergence, ramification of submergence, dam safety, drinking
     water schemes, irrigation, infrastructure etc., the process of
     clearances obviously gets linked with multiple agencies and
     authorities. Short cuts could create problems.
e)   Construction time is another area of concern, which needs to be
     compressed. Large projects have taken inordinately long time.
     There are two major aspects which could make a difference – one
     is relating to construction management techniques starting from
     planning to monitoring and another relate to construction

                                                                      21
technology. Here again, there are recent examples of making
            substantial improvement on both the fronts. Some of the projects
            which have been sanctioned in the recent months are being
            targeted to be completed within 4-5 years.


      f)    Communication with press, media and people at large to reduce
            the communication gaps on merits of hydro-projects and on
            migratory measures is another area of challenge which is being
            addressed. This also needs to be taken up appropriately at global
            level.


    Opportunities in Indian hydroelectric sector:


About 14,000 MW          of additional capacity in the period 2002-2007 and
50,000 MW of additional capacity during the period 2002-2017 throw open
enormous opportunities for national and international agencies.              The
opportunities fall in the following categories.
            a)       Preparation of DPR for the 162 schemes with over 50,000
                     MW capacity
            b)       EPC contracts for development of many of these projects
            c)       Package wise contracts in a large number of projects.
            d)       Investment as equity holder and project developer
            e)       J.V. with Indian Companies for developing projects




                                                                               22
CONCLUSION


In order to achieve a growth rate of 7-8 % as envisaged in National policy of
India ,it is also required to tap all the small Hydro Power potential of the
country. The encouraging performance shown by the Tawa project itself set
an example for inviting private investment in the small Hydro Power Project
sector, especially in view of the fact that Large Hydro power projects involve
huge capital investment and long gestation period which private partners do
not afford to bear.
    The utilization of small Hydro Power Potential is especially required in
all states where the utilized potential is very low like in MP and therefore
optimum utilization of the same may set up an stepping up stone for
achieving self sufficiency in power sector in country.




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Energy project report on hydropower

  • 1. A PROJECT REPORT OF Energy and Environment Management ON Land Resources SUBMITTED TO:- SUBMITTED BY:- Ashish Porwal Dr. Rudra Rameshwar Anuj Saini Nitin Jain Shubhra Bhugra Sonali Gambhir 1
  • 2. ABSTRACT Hydro Power Project may be used as one of the option for achieving the energy targets in a developing country like India where center or state Governments have limited financial resources to put in large projects which require long gestation period. One additional advantage with the Small Hydro Power. Project is that private partners may get attracted due to low investment and quicker return in comparison to large projects. The last but not least is the most eco friendliness of small power projects which is a point of serious concern in case of thermal, or nuclear or sometimes in big Hydro power projects depending upon the location of the projects. Small Hydro Power potential in India is still under-utilized and there is need to tap this potential for optimum utilization of natural resources. In Madhya Pradesh, Small hydro plants are not many , however there is good scope for developing such plants. Tawa is one of such plants in MP, which has been developed as canal head powerhouse on the left bank canal (LBC) of Tawa irrigation project by a private investor. This plant is working in a very efficient manner addressing both the power and irrigation aspects successfully. This example will attract the private investments in small hydropower sector in the developing countries like India. 2
  • 3. ACKNOWLEDGEMENT The success of any research study depends upon a number of factors among which the proper guidance from the experts in the industry and a faculty plays an important role. We would like to express our heartfelt thanks to many people. This Project is an effort to contribute towards achieving the desired objectives. In doing so, we have optimized all available resources and made use of some external resources, the interplay of which, over a period of time, led to the attainment of the set goals. We take here a great opportunity to express our sincere and deep sense of gratitude to Dr. Rudra Rameshwar for giving us an opportunity to work on this project. The support & guidance from Sir, was of great help & it was extremely valuable. We express our sincere thanks to all the people who, directly or indirectly, contributed in time, energy and knowledge to this effort. 3
  • 4. TABLE OF CONTENTS:  Abstract  Acknowledgement  Introduction  History Of Hydropower  Hydropower In India  Hydroelectric Projects Development: CHALLENGES  Low Exploitation of Hydro Potential  Power Shortage in India  Declining proportion of Hydro Capacity  Thrust on Hydro Power  Govt. of India Initiative on Hydro Power Development  Current issues/ problems with Hydropower in India  Major challenges and responses  Opportunities in Indian hydroelectric sector  Conclusion 4
  • 5. INTRODUCTION Hydropower is a renewable, non-polluting and environment friendly source of energy. It is perhaps the oldest energy technique known to mankind for conversion of mechanical energy into electrical energy. Hydropower represents use of water resources towards inflation free energy due to absence of fuel cost. Hydropower contributes around 22 % of the world electricity supply generated. The total potential of small Hydropower of the whole world is 780,000 MW out of which 50,000 MW has already been utilized. Small Hydro is also the highest density resources in generation of electricity due to the reason of being it environment friendly, flexibility in operation and suitability in giving support in peak time to the local grid. Due to the small gestation period, small capital investment and quicker return involved, in recent years it has become the point of attraction for private sector. Fiscal incentive announced by the central and state Governments time to time for investment in this sector have further caused private investor to give attention to this sector. Small hydro power plants (SHP) provide maximum benefits in minimum time. And offers the most fastest economical means to enhance power supply, improve living standards, stimulate industrial growth and enhance agriculture with the least environmental impact and without heavy transmission losses .Due to less transmission losses there is a reduction in distribution cost as well. Its availability at the head of the irrigation canals and small streams is also a one of the added advantage of it. 5
  • 6. HISTORY OF HYDROPOWER The first hydroelectric power dam in the world was built in Appleton, Wisconsin in 1982. In India, Jamshed ji Tata built the first hydroelectric power dam in the Western Ghats of Maharashtra in the early 1900s to supply clean power to Bombay’s Cotton and Textile Mills. He took the British Government’s permission to build dams, namely the Andhra, Sirowata, Valvan and Mulshi hydel dams in the Western Ghats to generate electricity using high rainfalls in the hills as storage areas. Humans have been harnessing water to perform work for thousands of years. The Greeks used water wheels for grinding wheat into flour more than 2,000 years ago. Besides grinding flour, the power of the water was used to saw wood and power textile mills and manufacturing plants. For more than a century, the technology for using falling water to create hydroelectricity has existed. The evolution of the modern hydropower turbine began in the mid-1700s when a French hydraulic and military engineer, Bernard Forest de Belidor wrote Architecture Hydraulique. In this four volume work, he described using a vertical- axis versus a horizontal-axis machine. During the 1700s and 1800s, water turbine development continued. In1880, a brush arc light dynamo driven by a water turbine was used to provide theatre and storefront lighting in Grand Rapids, Michigan; and in 1881, a brush dynamo connected to a turbine in a flour mill provided street lighting at Niagara Falls, New York. These two projects used direct-current technology. 6
  • 7. Hydropower In India With the liberalization of the economy, the Government of India has been encouraging and invited private sector for investment in the power sector. Accordingly, a conducive policy environment has been created by modifying the Electricity Act. The new Electricity Act-2003 deals with the laws relating to generation, transmission, distribution, trading and use of electricity. The Act has specific provisions for the promotion of renewable energy including hydropower and cogeneration. It has been made mandatory that every state regulatory commission would specify a percentage of electricity to be purchased from renewable by a distribution licensee. The National Electricity Policy announced in 2005 aims at access of electricity by all households and per capita availability of electricity to be increased to 1000 units by 2012. The Policy underlines that renewable energy potential needs to be exploited and private sector would be encouraged through suitable promotional measures. Regarding fixing of tariff, the government has announced Tariff Policy in 2006 wherein the State Regulatory Commissions are required to fix tariff in their respective state and also decide about the renewable purchase obligation. The Electricity Act and Tariff Policy are favorably tilted towards increasing power generation from renewable. Now, Central Electricity Regulatory Commission has also announced the tariff calculation guidelines for renewable technologies including for small hydro projects. The existing power deficit and a rapid growing demand coupled with government commitment to provide access to electricity for all has necessitated a large scale capacity addition program. A capacity addition of 78,000 MW in the 7
  • 8. 11th Plan (2007 to 2012) and approximately one 100,000 MW in the 12th Plan (2012-2017) is planned. Concurrent investments in Transmission and Distribution are also going on. Such a gigantic task is strongly supported and complemented by the private sector. These changes facilitated the removals of barriers to investment, improved the functioning of the system and resulted in additional generation of power much in excess of that achieved in the earlier plans. Ministry of New & Renewable Energy (MNRE) Government of India is the nodal ministry for small hydropower development in India. 8
  • 9.  HYDROELECTRIC PROJECTS DEVELOPMENT: CHALLENGES  Enhancing the level of energy consumption, particularly in less developed and developing countries, is a global challenge. 20% of world population living in industrialized countries consume 60% of energy and remaining 80% of population have to manage within 40% of total energy. This has obviously resulted in wide disparities between the standard of living and quality of life of high energy consuming countries on the one hand and those who do not have the opportunities of adequate access to energy on the other. It is precisely for this reason that development of different sources of energy and increase in its consumption has become a priority agenda of all the developing countries.  Various countries have adopted their own strategies to provide energy to their people. In the context of electric power, as an important form of energy, the thermal and hydroelectric power on a global basis, have occupied the largest proportion. Within the thermal group, coal based power stations occupy dominant position. However, this varies from country to country. The Gas based combined cycle power stations in number of countries occupy a significant proportion. Similarly, nuclear power stations have also increased and have been adding large amount of capacity to the thermal group. During last 30 years, Hydroelectric power generation has, as a matter of fact, reduced from 21% in 1973 to less than 17% in 2000. During the same period, coal based generation marginally increased from 38% to 39%, gas increased substantially from 12% to 17.4% and nuclear witnessed a very steep rise from 3.3% to 16.9%. Obviously concerted efforts are required to develop Hydroelectric capacities. 9
  • 10.  Low Exploitation of Hydro Potential : Inspite of hydroelectric power requiring a clean energy generation process, exploitation of Hydroelectric potential in various countries has been rather on a lower side. :  Power Shortage in India: In India, though over 100,000 MW of capacity has been added in last 50 years, there is a huge gap between the demand and supply of power. While in the last few years it has marginally reduced, the peaking shortage continues to be over 12% to 13% and the average energy shortage at about 8.8%. Indian power system has an installed capacity of 108,207 MW in May 2003, with hydroelectric accounting for 25%.  Declining proportion of Hydro Capacity: In the last 30 years, the proportion of hydroelectric capacity in the Indian power system has considerably reduced. It has dropped from about 46% in 1970 to 40% in 1980, 29% in 1990 and now 25% in 2003. In spite of the Hydroelectric potential, which is now estimated to be of the order of 150,000 MW, the exploitation has been of the order of 27,000 MW. Some of the 10
  • 11. important reasons for decline in the Hydroelectric proportion in the total capacity over the last 30 years are as follows: a) Indian power supply industry has always experienced the situation of shortages both in energy and peaking requirements. To tide over the shortage in shortest possible time, more dependence was placed on sources of power generation with shorter gestation period. Obviously this short-term approach rather than a long-term perspective led to this problem. b) With abundant coal reserves in the country, large capacity additions through coal based pithead power stations during the eighties and nineties increased the thermal proportion. c) Emergence of gas based combined cycle power stations based on indigenous natural gas with gestation period of 2-2 ½ years also received priority in response to the anxiety to create capacity addition in shortest possible time. d) Nuclear power stations have also emerged as reliable modes of thermal generation. e) In spite of best efforts at the stage of planning and formulating projects in the hydro segment, a number of large projects got into long gestation period of construction on account of various reasons, namely environmental issues, rehabilitation & resettlement (R&R) problems, gap between investigations and field realities, etc. We do have a number of successful stories on the hydroelectric projects but we also have large projects which have taken several years to get completed. 11
  • 12. Thrust on Hydro Power: In the recent years, the Govt. of India has committed quantum jump, in the financial allocation and also by way of other supports so that Hydroelectric projects not only get right priorities but also contribute in an increased way to the future capacity addition programs of the country. Accordingly, in the 10th Five-Year Plan (year 2002-2007), the target for hydroelectric capacity has been placed 14,393 MW, which is more than the total installed capacity (13,666 MW) created in the last 20 years. The thrust on hydroelectric development is based on the following considerations: a) Hydroelectric involves a clean process of power generation. Once the projects are constructed, there is no pollution ramification unlike many other power generation technologies and processes. b) Since it does not suffer from the limitation of inflation on account of fuel consumption, in the long run, it is the most cost-effective option for power supply. In Indian context, where more than 45% of Indian population has yet to have access to electricity at an affordable price, this is an important consideration. c) Indian power supply system has a peculiar limitation of huge variation between peak and off peak requirements. Management of peak load in an effective manner could be conveniently handled through availability of hydroelectric support. The system at present does suffer from large frequency variations. Better hydro support could address this problem better. 12
  • 13. d) Locations of Hydroelectric projects in India are also in areas which need substantial support for their economic development. These areas are North-east, Uttaranchal, Himachal Pradesh & Jammu & Kashmir where more than 80% of potential exists. Developing projects in these areas will spur economic activities and will lead to overall economic development. e) In an integrated Hydroelectric project – there are many such projects – the schemes involve not only supply of electricity but also provision of drinking water and irrigation. These are important issues in many parts of India. Hydroelectric projects, in many cases, do have the ability to mitigate these problems. f) Flood control is also an issue and quite often a challenge. Integrated hydroelectric projects could adequately address this concern.  Govt. of India Initiative on Hydro Power Development: The main features of the Government of India policy on hydro power development are as follows:  Additional budgetary financial support for ongoing and new hydro projects under Central Public Sector Undertakings.  Basin-wise development of hydro potential – comprehensive Ranking studies for 399 schemes. 13
  • 14. Advance action for capacity addition – 10 year ahead of execution  Emphasis on quality of survey & investigations  Resolution of inter-state issues on sharing of water and power.  Renovation, Modernization & Uprating of existing hydro stations  Promoting small and mini hydel projects – 25 MW and below now fall into category of “non-conventional” qualifying for benefits.  Simplified procedures for clearances by Central Electricity Authority; Electricity Act 2003 further liberalizes this.  Rationalization of hydro tariff by allowing premium on sale rate during peak period  Realistic estimates of completion cost considering new development on geological front during execution.  Promoting hydel projects in joint venture  Selection of developer through MOU/Bidding route  Govt. support for land acquisition, resettlement and rehabilitation, catchment area development, etc.  Some of the measures announced by; Govt. of India have already been introduced which include simplified procedures for transfer of techno-economic clearances, streamlining of clearance process and introduction of three-stage clearance approach for 14
  • 15. development of hydro projects in Central Sector/Joint Ventures, etc.  The Central Electricity Regulatory Commission has approved 5% hydro development surcharge on annual fixed charges for central hydro power generation.  National policy on Hydropower in India:  With the aim to accelerate the development of Hydropower, the Ministry of Power (MoP), Government of India (GoI) introduced the National Policy on Hydropower Development in 1998. The policy document has identified and responded to the major issues and barriers.  With Central, State and Private hydropower projects contributing 3455 MW, 5810 and 550 MW respectively, the GoI aims to reach the total capacity of 9815 MW during the ninth plan. (The XI th Plan aims capacity addition of 18781 MW in the hydropower sector) 15
  • 16.  Exploitation of vast Hydro Electric potential at faster pace:  The government would take steps like execution of all CEA cleared projects, update and clear pending DPRs, survey new green field sites and resolve inter-state disputes.  Promotion of small and mini hydro projects  Small and mini hydro projects are especially viable for remote and hilly areas where extension of grid system is comparatively uneconomical  Strengthening the role of PSUs and SEBs in taking up new hydro projects  The government aims at enlarging Public sector’s involvement in mega hydro projects and multi-purpose projects involving inter-state issues, projects for peaking power and those with rehabilitation and resettlement issues.  Increasing private investments for development of hydropower in India  The public sector would be supported by greater private investment through IPPs and joint ventures. Private sector participation is considered vital for large scale development of hydropower.  Through these measures, GoI aims to realize 100% hydropower potential of the country by year 2025-26. These objectives have been developed in response to the following constraints:  Technical, including difficult investigation, inadequacies in tunneling methods)  Financial (deficiencies in providing long term finance) 16
  • 17.  Tariff related issues  Managerial weakness (poor contract management)  Geological surprises (especially in the Himalayan region where underground tunneling is required)  Inaccessibility of the area  Problems due to delay in land acquisition and resettlement of project affected families  Law and order problem in militant infested areas.  Current issues/ problems with Hydropower in India: The Government of India set up a National Committee in 1987 and a Standing Committee in 1998 to oversee the progress on hydropower development. This section derives largely from the report submitted by the Standing Committee on Energy (2005-06) - Hydro power: a Critique which discusses the actions taken by the Government on the recommendations made by the Committee in the forty second report on hydro power in India.  Technical issues: To expedite early execution of hydro projects, bankable Detailed Project Report (DPR) based on detailed survey should be prepared to avoid geological uncertainties. Survey & investigation and analysis of geological, geo-morphological, geo-electrical, hydrological data etc. should be done at the time of preparation of a DPR itself in order to minimize the impact of 17
  • 18. risks. It is, therefore, necessary to expedite survey and investigations with the latest state of the art technology and prepare a shelf of projects for execution. The quality of DPRs should be of high standard which should infuse confidence in the national/international developers to take up the execution of projects without loosing time in rechecks etc at the same time, contract monitoring as distinct from project monitoring should be emphasized and land acquisition and infrastructure development be settled and completed before the start of the project. Renovation and Modernization (R&M) has been recognized world over as a well proven cost effective technique for improving the performance/efficiency of older power plants. The useful life of the plants can be increased by R&M and the plants yield benefits in the shortest possible time at a reasonable cost. GoI in its policy on hydropower development, 1998 has laid stress on need for renovation and modernization of hydro power plants. Contingency Plan for Hydro Projects affected by Natural Calamities need to be prepared and made public. National Policy on Rehabilitation and Resettlement (R&R) should be finalized and made public.  Infrastructural issues: There is a need to setup single window clearance for hydro projects. Various authorities such as the Central Electricity Authority (CEA), the Ministry of Finance, Ministry of Environment and Forests, etc. are involved in the appraisal of a hydro power project before it is certified for development. It will be desirable to have a single window dispensation/authority so that a project is cleared without many hassles. 18
  • 19. The hydro projects which involve lesser risk element and entail lesser capital investment can be considered for development in the Private Sector. Public Sector can take up (a) Multi purpose Projects (b) Projects Involving inter- State issues and in inter-State river systems, (c) Projects involving cooperation with neighboring countries and (d) Projects for complementary peaking with regional benefits (e) Projects in the North-Eastern Region etc.  Financial issues: There is also a need to off-load indirect cost components on hydro project. Many hydro projects are located in troubled areas and infested by militancy and terrorist activities. There is an urgent need to amend the present policy of the Government in regard to charging the entire security expenditure from concept and until commissioning - on the project cost. However, the recurring expenditure incurred on security, once a project goes on stream could to be charged on the project developer. The cost of access roads should not be included in the project cost, as development of hydro projects triggers economic and commercial activities around the project site and results in economic benefit to the State. Inclusion of R&R, flood moderation costs, along with the provision of 12% free power to the State in the capital cost of the project needed reconsideration as the provision did not apply to thermal power projects. 19
  • 20.  Major challenges and responses: Development of Hydroelectric projects has thrown up a number of important challenges, the world over and particularly in Indian context. Over a period of time, experiences have been acquired and India is responding to these challenges in the following manner. a) Impact on Environment: Hydroelectric projects do create environmental issues emanating from sub-emergence of large areas also involving forest. The Govt. of India has a comprehensive legislation on environmental issues and based on this legislation, there are well laid down principles and guidelines. Environment Impact Assessment studies when properly carried out throw up the tasks to be undertaken by the project development agencies. Ministry of Environment & Forest is working on a plan to create Forest Bank which would entail creation of huge afforestation with funding from project development agencies in advance so that this issue could be adequately responded. The mechanism of compensatory afforestation through the Forest Bank will enable quicker clearances of projects. b) Rehabilitation & Resettlement (R&R) of Project Affected People (PAP) is another major issue affecting the smooth execution of 20
  • 21. Hydroelectric projects particularly where in submergence areas, the number of project affected people are large. c) Another issue of concern is in relation to safety of dams. Here again, experiences from some of the very large projects of the country have led to considerable amount of knowledge base and it is expected that in future projects, studies and findings on dam safety could provide much higher degree of confidence. Some of the Indian institutions have equipped themselves both with hardware and software to properly address these concerns. Where required, project development agencies do depend on expertise available anywhere in the world for in depth studies and guidance. d) In view of complexity in development of Hydroelectric projects, particularly large ones, emanating from dam height, submergence, ramification of submergence, dam safety, drinking water schemes, irrigation, infrastructure etc., the process of clearances obviously gets linked with multiple agencies and authorities. Short cuts could create problems. e) Construction time is another area of concern, which needs to be compressed. Large projects have taken inordinately long time. There are two major aspects which could make a difference – one is relating to construction management techniques starting from planning to monitoring and another relate to construction 21
  • 22. technology. Here again, there are recent examples of making substantial improvement on both the fronts. Some of the projects which have been sanctioned in the recent months are being targeted to be completed within 4-5 years. f) Communication with press, media and people at large to reduce the communication gaps on merits of hydro-projects and on migratory measures is another area of challenge which is being addressed. This also needs to be taken up appropriately at global level.  Opportunities in Indian hydroelectric sector: About 14,000 MW of additional capacity in the period 2002-2007 and 50,000 MW of additional capacity during the period 2002-2017 throw open enormous opportunities for national and international agencies. The opportunities fall in the following categories. a) Preparation of DPR for the 162 schemes with over 50,000 MW capacity b) EPC contracts for development of many of these projects c) Package wise contracts in a large number of projects. d) Investment as equity holder and project developer e) J.V. with Indian Companies for developing projects 22
  • 23. CONCLUSION In order to achieve a growth rate of 7-8 % as envisaged in National policy of India ,it is also required to tap all the small Hydro Power potential of the country. The encouraging performance shown by the Tawa project itself set an example for inviting private investment in the small Hydro Power Project sector, especially in view of the fact that Large Hydro power projects involve huge capital investment and long gestation period which private partners do not afford to bear. The utilization of small Hydro Power Potential is especially required in all states where the utilized potential is very low like in MP and therefore optimum utilization of the same may set up an stepping up stone for achieving self sufficiency in power sector in country. 23
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