Budgetary Support for the cost of Enabling Infrastructure for Hydro Electric Project

Daily Current Affairs 

14-09-2024

Budgetary Support for the cost of Enabling Infrastructure for Hydro Electric Project

IN NEWS

• Union Cabinet modified the scheme for faster development of Hydro Electric Projects (HEP) and improvement of infrastructure in remote and hilly project locations.
• Scheme of Budgetary support for cost of enabling infrastructure for HEP was launched by Ministry of Power in 2019, along with other measures to promote hydropower sector in India.
• It provided budgetary support for constructing roads and bridges connecting major dam, power house and other project infrastructure with nearest state/national highway.

MODICATIONS IN THE EXISTING SCHEME

• Funding: Total outlay of Rs.12,461 crore for cumulative generation capacity of about 31,350 MW.
• Implementation Period: FY 2024-25 to FY 2031- 32.
• Expansion: Scheme expanded to include costs for constructing transmission lines, ropeways, railway sidings, and communication infrastructure, in addition to roads and bridges.
• Eligibility: HEPs >25 MW capacity including private sector projects and all Pumped Storage Projects (PSPs).

What are the benefits of hydroelectric projects?

• Low Carbon Emissions: Unlike the traditional fossil fuel sources of energy, using hydropower to produce electricity does not release any pollutants in the air or dirty water.
• Renewable Energy: Hydropower is a renewable source of energy. The energy generated through hydropower relies on the water cycle, which is driven by the sun, making it renewable. Unlike fossil fuels, it needs no extraction of resource. It requires flow of water. It also complements other renewable energy sources. Technologies like Pumped Storage Hydropower (PSH) store energy to use in tandem with renewables such as wind and solar power when demand is high.
• Economic Benefits: Hydroelectric projects provide economical and reliable power over long time. They have high initial construction costs, but the long duration of projects and relatively low maintenance costs make them more viable in the long term.
• Irrigation and Drinking Water: Hydropower projects have large associated benefits like provision of irrigation and drinking water.
• Other Benefits: Reservoirs/Storage-based hydropower projects aid in flood control. Local communities can benefit from fisheries and other activities in the reservoirs. Large hydropower projects also support tourism and recreational activities.
• Employment Generation: Hydroelectric projects support lot of economic activities and generate additional employment including in manufacturing, utilities, business services, construction, transportation, energy systems, water management, tourism etc.
• Reduce Dependence on Fossil Fuel: India has large hydroelectric potential. Harnessing the potential can reduce dependence on fossil fuels (electricity mix) and save foreign exchange reserves.

ASSOCIATED CHALLENGES WITH HEP DEVELOPMENT IN INDIA

• Financial constraints as HEPs are capital intensive and require high upfront costs.
• Geological concerns during construction in hilly regions, especially in Himalayas.
• Power Evacuation issues as these are built in remote regions.
• Social issues due to large land acquisition and rehabilitation requirements

SIMILAR STEPS FOR HEP DEVELOPMENT IN INDIA

• Declaring Large Hydro Power projects (> 25 MW projects) as Renewable Energy sources.
• Hydro Power Purchase Obligations (HPOs) requiring entities to purchase electricity from HEPs.
• Tariff rationalization measures for bringing down hydropower tariff
• Budgetary support for flood moderation / Storage HEPs.

WAY FORWARD

Following a targeted and logical approach towards this segment of development is the key requirement of the country that involves –

• Ecological Sustainability: Ecological sustainability should be the topmost priority in fragile ecosystems like the Himalayas. Large hydroelectric projects should be avoided in Uttarakhand. In an affidavit filed before the Supreme Court in 2021, the Union Government had said that no new big project would be established in the upper reaches of Ganga.
• Promote Small-Hydro Projects: In such fragile environments only small run-of-the-river projects should be allowed that have minimal impact on the ecosystem.
• Accelerated Hydropower Development: In other areas, where ecology is not so fragile, the hydropower potential should be utilized. This is necessary to meet rising energy demand in India amidst the need to reduce dependence on fossil fuels as primary energy resources.

Private Sector Participation: The involvement of the private sector and joint ventures with the neighbouring countries can go a long way towards achieving the goal of “power to all” in the coming years