India halts 5.9GW of hydropower projects over financial stress

The government is forced to set up a new hydropower policy as soon as possible.

The Indian electricity regulator Central Electricity Authority (CEA) has stalled about 16 hydropower projects with a total combined capacity of 5,950 MW due to financial constraints, prompting the government to set up a new hydro policy as soon as possible. This represents approximately half of the hydropower projects currently under construction in the country in terms of capacity. Out of the 16 power plants, 10 are paralyzed due to financial stress.

The Ministry of Power is working on the development of a new hydropower policy which will be presented to the Parliamentary Standing Committee on Energy. It will help to prop up the sector, which is facing significant competition from thermal power plants but also from other renewable power sources such as wind and solar. In particular, the proposal would remove the distinction between small projects of up to 25 MW capacity and large projects above the 25 MW threshold. Large projects are currently not entitled to the same benefits and incentives as smaller ones. Under the new legislation, all hydropower projects would be declared as renewable, whatever their size and capacity.

This article was originally published by Enerdata.