New Delhi, Aug 5 (PTI) A Parliamentary panel has asked the Ministry of Power to expedite implementation of delayed electricity transmission projects, saying cost and time overruns will have implications on the power tariff.
Although India is a power surplus country, electricity does not equitably reach all regions due to network constraints in some states, the Parliamentary Standing Committee on Energy said in its 19th report tabled in Parliament on Thursday.
It noted that transmission within the states remains a major issue, leading to intermittent power cuts and shortages in localised areas.
Further, the committee said it believes that cost and time overruns in transmission projects will inevitably have implications on the cost of power.
“The Committee, therefore, desire that the Ministry (of Power) should not remain complacent and must expedite the completion of delayed transmission projects by utilizing the existing institutional mechanism, while ensuring that alternative arrangements are made to evacuate the power by transmission implementing agency so that no bottling-up of power generated occurs due to lack of transmission network,” it added.
It further said issues arising out of the transmission line corridor passing through natural obstacles, adverse terrain, government land, forest, private land etc should be foreseen and taken care of by methodical route planning, proactive measures, coordination with state administration and perpetual follow-up by the project management team.
It noted that Power Grid Corporation of India Ltd is implementing 42 power transmission projects, out of which 18 are delayed.
The committee was also not satisfied with the reply of the power ministry that delays in transmission projects have only minimal effect on the sector due to robust power transmission network and electricity demand being lower than projected.
About delayed hydro power projects, it stated due to long construction period, interest on loan plays a very critical role. Higher interest on outstanding loan leads to higher yearly tariff, it noted.
The panel suggested a review of financing policies for hydro power projects with a view to provide longer tenure debt with softer interest rates.
It also said inadequate infrastructure like roads and bridges particularly in Arunachal Pradesh and other north-eastern states results in longer construction period, thereby increasing the project cost.
Agencies like BRO, state PWD etc implementing the road sector projects need to be provided adequate support to complete the projects expeditiously, it suggested.
It also said the National Clean Energy Fund (NCEF) could be used for development of roads, bridges and infrastructure common for hydro power projects.
Considering the long gestation period and large investment involved, a single window clearance mechanism becomes necessary to reduce the cost and time overruns, it stated.
The panel noted that there are 24 under-construction hydroelectric projects (above 25 MW) having aggregate capacity of 1,1342 MW having either time or cost overruns in 11 states/UTs.
The time overrun in these delayed hydro projects ranges from 12 months to 189 months, while cost overruns reach up to 472.92 per cent.
It also noted that there are 13 hydroelectric projects being developed in the central sector by CPSUs and most of these projects have been badly delayed.
Although the work has started in 11 projects, construction of 2 projects is still held up, it added.
“Astonishingly, 12 delayed hydro projects with cumulative time overrun of almost 1205 month have resulted in huge cost overrun of Rs 31,530.03 crore so far,” it noted.
Out of total 34 thermal power projects in the country (both central and state sector), 30 are delayed having total cost overrun of Rs 41,100.20 crore and time overrun of 1,776 months, it observed.
It added that due diligence and careful negotiation on contract terms and conditions between project developer and contractor should be ensured during the contract formation stage. PTI KKS KKS ABM
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Disclaimer: This story has not been edited by Outlook Staff and is auto-generated from news agency feeds. Source: PTI
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