Hydropower market down, India’s ‘8 dams’ unlikely to be built

Hydropower market down, India’s ‘8 dams’ unlikely to be built
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SRINAGAR: None of the 8 hydropower projects that the Government of India is trying to build quickly in Jammu and Kashmir, has the potential to yield economic benefits, yet steps are being taken in that direction. Why?
Himanshu Thakkar, coordinator at South Asia Network on Dams, Rivers and People, told Kashmir Reader that the GoI “has no justification for construction of these projects. Neither are they going to yield any economic benefits, nor are the people of the place where they are going to come up will be involved in decision making.”
Earlier this week, it was reported that India is mulling to speed up the construction of Sawalkote (1,856 MW), Kirthai I (390 MW), Kirthai II (930 MW), Pakal Dul (1,000 MW), Kwar (540 MW), Kiru (624 MW), Bursar (800 MW) and Ujh project (212 MW). All these power projects are being built on rivers that flow to Pakistan. The process is being taken up at a time when there is flare-up between India and Pakistan over Kashmir.
Iftikhar Drabu, an expert on hydropower projects, said that “the news item wants (referring to the story about speedy construction in Indian media) more to attract media attention, though one would need to be cautious since it looks like that central PSUs other than NHPC are seeking projects here in JK, to tide over their internal problems. Also, it might be to build pressure on Pakistan since these projects are all on Western Rivers where Pakistan has unrestricted rights under the Indus Water Treaty (IWT).”
Sawalkote, according to him, is under development since early ’90s, first by NHPC and later by JKSPDC. He said the first DPR was prepared in 1992 and recently, a fresh DPR was approved at Rs 11 crores per MW.
“With a construction period of nearly a decade, and given the stress, it does not look there will be much movement on the project. The story is similar in Bursar, Kirthai, Kwar and Kiru,” he said.
“It is good to be positive, but we need to be realistic as well. After all, these are business propositions. There is already stress in the energy market, particularly for hydropower projects. Investment in these projects comes at a high price and given the current energy market scenario, I don’t see any commensurate returns. There is stagnation in the market of hydropower electricity,” Drabu said.
“About Bursar, the estimated tariff cost is very high and at that rate it is not a viable project. Even after accounting for the improved generation on downstream projects, once this project is commissioned, still the tariff would be much higher than what the market can afford. When, at Rs 4.5 per unit, the State Power Development Corporation is unable to find buyers for the past two years for Baglihar II, who will buy Bursar power, estimated to cost several times over that rate? JKSPDC is today forced to sell this power to JKPDD at Rs 2.5 per unit. The irony is that even at that rate, the JKPDD is defaulting on payments. This is increasing the interest burden on the project,” he added.
However Director JKSPDC, Shah Faesal admitted that markets are not good. But, he said, “It does not mean that we won’t do anything. Things have to be done and let us be positive about them.”


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