JK Gets News Power Policy

JK Gets News Power Policy

7 July 2011
Rising Kashmir


Srinagar: The state cabinet Thursday approved Jammu and Kashmir State Hydro Projects Development Policy– 2011 paving way for the state to get 15 per cent free electricity and 30 per cent more electricity on the rate to be fixed by State Electricity Regulatory Authority.One of the interesting clauses of the new policy is that projects under 10 MW-capacity have been kept reserved for permanent residents or local entrepreneurs.Briefing media persons about the features of the policy here at SKICC, Chief Minister, Omar Abdullah stressed on the need to harness the potential of small hydroelectric projects, adding that the state could not do so because of the “flawed” Hydroelectric Policy of 2003. Flanked by MoS Power, Shabir Khan, the chief minister said the new policy would open vistas for launch of various hydroelectric projects in the state. “We have been talking enough about power generation, but we have focused on projects having large potential. Unfortunately, nothing has been done to exploit small hydroelectric projects,” said Omar. Stating that small hydroelectric projects could not be harnessed due to “flawed” Hydroelectric Policy of 2003, he said, “A committee headed by Economic Advisor to government and comprising of administrative secretaries of Planning, Finance and Power departments was constituted to formulate a revised policy for the State.” Omar said the committee was given a mandate to modify the 2003 policy so that the potential of small hydroelectric projects could be tapped. “The proposal was tabled in the cabinet and it was unanimously approved,” he said. He said the new policy would cover projects ranging from 2 MWs to 100 MWs. “I believe under the new policy, we would be able to generate 250 to 300 MWs of power in near future,” he said. “The policy has nothing to do with the improvement of transmission and distribution losses.” Omar, who also holds the portfolio of power, said under the new policy projects under 2 MW-capacity would be given to the Science and Technology departments. “This has been done not to overburden the Power Development Department or Power Development Corporation,” he said. The need to modify the 2003 policy, Omar said, was felt owing to the fact that the existing policy created lot of problems for the government in execution of the projects in legal ways as well. “One of the biggest problems in the 2003 policy was model implementation agreement. The companies refused to implement that agreement; even one of the company owners moved court to challenge the agreement,” said Omar. He said 25 projects for which tenders had already been issued under the existing policy stand cancelled. “New tenders will be re-advertised.” The chief minister said concession period for the projects to be taken up under the new policy would be 35 years. “The State will have the rights to continue or to demand return of the project after the concession period,” Omar said. He said State will get 15 per cent free power under the policy. “The two hydroelectric projects we are having at Branwar and Athwatoo export power outside,” Omar said. He said State will get 35 per cent power at the rates to be fixed by the State Electricity Regulatory Authority. “The successful bidders would be required to pay an upfront premium not less than Rs. 4 lakh per MW for 2 to 25 MW projects, Rs 6 lakhs per MW for projects between 25 and 50 MWs and not less than Rs 8 lakhs per MW for projects of above 50 to 100 MWs,” he said. To a query that whether they have studied the pros and cons of the projects to be taken up under the policy, Omar said for some of the projects environment impact analysis has already been done and the process would be same for other projects. On whether the projects would be taken up on a specific river, he said majority of hydroelectric projects would be on river Chenab and its distributaries and other projects would be on other rivers. On SPDC: The chief minister said State Power Development Corporation will be the nodal agency for the effective implementation of the new policy. “The SPDC will also ensure completion of projects on time.” On land Acquisition: Omar said in the previous policy, land acquisition had to be left to the independent power producers. “But in the new policy, land acquisition process will be taken care by the SPDC,” he said. About T&D losses: The chief minister said the new policy doesn’t deal with T&D losses but with the generation. “We are separately looking into that thing. There is an ambitious plan prepared by New Delhi, but the funding for that was beyond State’s capacity. This is something that came up during the discussion between me and the Planning Commission of India,” he said. On Army being an independent producer: Omar said there was no provision in the policy that army can’t be an independent power producer. “But I hope army won’t show its interest in producing electricity. My information is that majority of the projects taken up by army under operation Sadbhavna are not generating electricity,” he said. He said the government has already taken up the issue with the army and New and Renewable Energy Ministry. “We have been talking to both, to either revive the projects or to leave them so that we could cover them under the new policy,” he said. On Power Losses: Omar said the State was witnessing power losses annually to the tune of Rs 1700 to 1800 crore. “We are mulling to outsource revenue collection in Jammu and Srinagar. Besides, I have directed the power department to speed up installation of electric meters,” he said.


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