Cabinet approves new hydroelectric policy of J&K

Srinagar, July 07: The state cabinet which met here under the chairmanship of chief minister Thursday approved new hydroelectric policy of Jammu and Kashmir. Addressing reporters here, the Chief Minister said that the Jammu and Kashmir State Hydro Projects Development Policy (JKSHPDP) –2011 would open vistas for launch of various hydroelectric projects in the State under IPP mode.He said that the new policy to be applicable to the projects of estimated installed capacity of 2 to 100 MWs envisages preference to the state subjects for the projects up to 10 MWs.Unveiling the policy and explaining its salient features at a press conference here, the Chief Minister said that J&K State Power Development Corporation (JKSPDC) will be the Nodal Agency of the State Government under the policy while projects up to 2 MWs will be handled by Science and Technology Department.“Under the new policy no IPP will be awarded more than 3 projects or projects aggregating over 200 MWs whichever is the higher. The projects shall be offered for concession period of 35 years after which these shall be transferred to JKSPDC on payment of terminal value without any encumbrance”, he added.Omar said that the successful bidders would be required to pay an upfront premium not less than Rs. 4 lakhs per MW for 2 to 25 MWs projects, Rs. 6 lakhs per MW for projects above 25 to 50 MWs and not less than Rs. 8 lakhs per MW for projects of above 50 to 100 MWs.“Under the new policy the State would get 15% free power throughout the concession period apart from 1% for Local Area Development Fund (LADF) besides the Procurement Right to the quantum not less than 30% after netting of free power and LADF”, he maintained explaining the benefits of the new policy for the State.The Chief Minister said that the policy also provides for timeline execution of projects, sale of power by IPP, grid interface-open access, bid parameters, role of Government, PDC and IPPs, responsibilities of IPPs, preference to permanent resident of the State in employment, preference to locally manufactured material and incentives for IPPs.Omar Abdullah said that the need for a new hydel policy was necessitated when the lacunas were identified by the IPPs in the Jammu and Kashmir State Hydel Policy 2003 and they declined to sign the agreements. “This had an impact on the process of allotment of 10 projects through competitive bidding under Phase-I and 25 projects tendered under IPP Phase-II resulting in cancellation of the tenders”, he said.“A Committee headed by the Economic Advisor J&K Government and comprising Administrative Secretaries of Planning, Finance, Power, Managing Director, JKSPDC and Development Commissioner Power as its members was constituted to formulate a revised Hydroelectric Policy for the State”, he said.The Committee associated Administrative Secretaries of Industries and Commerce, PHE, Science and Technology Departments and others in their deliberation. The Committee uploaded the first draft for initiating the comments of the stakeholders. The comments received were discussed and suitable changes wherever necessary were incorporated in the draft. The views received from Central Electricity Authority (CEA), Ministry of Power, Government of India were also discussed and considered. The draft policy was also circulated to all the concerned departments and the comments received were discussed and incorporated wherever needed. This all culminated in the final draft of the policy which was approved by the Cabinet in its today’s meeting.Replying various questions, the Chief Minister said that State Government was working on a plan for unbundling of transmission and distribution system in the State to incorporate reforms and improvement in power transmission and supply. He said 100% metering would help to reduce the transmission losses.The Chief Minister said that the new policy is largely aimed at harnessing power potential of small rivers and tributaries all across the State. He said that under the first phase we expect minimum power generation of 250 to 300 MWs under IPP.Minister of State for Power, Shabir Ahmad Khan, Chief Secretary, Madhav Lal, Principal Secretary to the Chief Minister, B. B. Vyas and Commissioner Secretary Power Development Department, Basharat Ahmad Dhar were also present at the press conference.