HP Govt announces ‘Open Hydel Policy’ to boost power sector

Shimla, June 3,

In a recent meeting with the Association of Independent Power Producers (IPPs), Chief Minister Thakur Sukhvinder Singh Sukhu announced the implementation of the ‘Open Hydel Policy’ in Himachal Pradesh. The policy aims to facilitate power producers and promote economic viability in the hydel sector. The Chief Minister assured the IPPs of the government’s complete support in removing obstacles and obtaining necessary clearances for their power projects
To expedite the development of hydel projects, the State Government plans to provide handholding assistance and streamline the clearance process. In case any gram Panchayat fails to provide a No Objection Certificate (NOC) within the stipulated time, it will be considered deemed sanctioned, ensuring a smoother approval process for power producers.
Highlighting the significance of the hydel sector as a major revenue source for the state, the Chief Minister emphasized its importance alongside tourism. To strengthen the state’s economy, the government has enacted the Water Cess Act, and the Chief Minister requested the IPPs to propose the quantum of water cess required for its implementation.
Furthermore, the Chief Minister expressed the government’s intention to enhance royalty rates for power projects established by Central Public Sector Units (PSUs) that have already covered their expenses. He directed the Himachal Pradesh Power Transmission Corporation Ltd. (HPPTCL) to expedite the installation of power transmission lines to ensure timely evacuation of power supply, thus preventing financial losses for the power producers.

Addressing the demand of IPPs, the Chief Minister assured that the State Government would consider calculating power tariffs from the date of commercial operation rather than from the Power Purchase Agreement for 41 power projects. Additionally, the government plans to issue an advisory to the Himachal Pradesh Electricity Regulatory Commission, urging them to consider royalty rates based on actual production at 12, 18, and 30 percent.

The Chief Minister also highlighted the contribution of 111 mini and micro power projects, which generate an annual revenue of Rs. 223.60 crore for the state. He urged the IPPs to complete their projects within the designated timeframe to maximize the benefits for all stakeholders. Currently, out of the potential 3539 MW of power through IPPs, only 754 MW has been harnessed, emphasizing the untapped potential in the state’s hydel sector.

The Himachal Pradesh Government is actively prioritizing the development of solar and wind energy sources. With a target of producing 500 MW of solar power this year, the government is also conducting a study to establish wind energy power projects in the state, demonstrating its commitment to renewable energy sources.

The meeting was attended by Industries Minister Harshwardhan Chauhan, MLA Chander Shekhar, and other senior officials from various departments. The government’s initiatives and support to the power sector are expected to bolster the state’s economy and provide a significant boost to its renewable energy infrastructure


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