International Conference on Small Hydropower - Hydro Sri Lanka, 22-24 October 2007

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Small Hydro Development In India

Praveen Saxena

Small Hydro Power, Ministry of New and Renewable Energy, Government of India, Block No. 14, C.G.O.
Complex, Lodhi Road, New Delhi 110003, India

Email: psaxena_98@yahoo.com

ABSTRACT

For the 8-9% growth rate that India aspires for, its energy needs are increasing correspondingly. The
electricity demand in the country is expected to grow at 10% per annum. With the Electricity Act (2003),
Electricity Policy (2005) and Tariff Policy (2006) in possession, the country has created a conducive
atmosphere for investments in the power sector. It has been realized that there is a need to tap all possible
sources of energy to meet this challenge and Small Hydro Power (SHP) is considered as a reliable option for
grid interactive as well as decentralized power generation.

The estimated potential of small hydro (upto 25 MW station capacity) in India is of about 15,000 MW of which
about 2005 MW has been exploited. The aim is that out of the total grid interactive power generation capacity
that is being installed, 2% should come from small hydro. A target of adding about 1400 MW during 2007-
2012. The Indian SHP development programme received a new tempo after the liberalization of economy and
invitation to private sector for investment in the power sector. Today the SHP programme is essentially private
investment driven. Electricity generation from small hydro is becoming increasingly competitive with
preferential tariffs and some other concessions. The challenge is to improve reliability, quality and reduce
costs. The focus of the SHP programme is to lower the cost of equipment, increase its reliability and set up
projects in areas which give the maximum advantage in terms of capacity utilisation.

1 INTRODUCTION

Hydropower represents use of water resources towards inflation free energy due to absence of fuel cost with
mature technology characterized by highest prime moving efficiency and spectacular operational flexibility. Out
of the total power generation installed capacity in India of 1,34,942 MW (July,2007), hydro power contributes
about 25% i.e. 33,711 MW. A capacity addition of 78,577 MW is envisaged from different conventional
sources during 2007-2012 (the 11th Plan), which includes 16,553 MW from large hydro projects. In addition to
this, a capacity addition of 1400 MW is expected from small hydro upto 25 MW station capacity.

India has a history of about 110 years of hydropower. The first small hydro project of 130 KW commissioned in
the hills of Darjeeling in 1897 mark the development of hydropower in India. The Sivasamudram project of
4500 KW was the next to come up in Mysore District of Karnataka in 1902, for supply of power to the Kolar
gold mines. Following this, there was number of small hydro projects set up in various hilly areas of the
country. Till independence (1947) , the country had an installed capacity of 1362 MW, which included 508
MW hydropower projects, mainly small and medium size projects. A planned development of hydropower
projects in India started only in the post independent era. The focus was laid on large-scale power generation
through big hydro, thermal and nuclear route. First 50 years after independence saw a capacity addition of
85,019 MW including 21,644 MW of hydropower stations, most of them were being large hydro. Since the
development was mainly in the Central sector and the State Electricity Boards (SEBs) were more or less tuned
to the central planning system, relatively less importance was given to small projects. In late 80’s, it was
realized that the development of Small Hydro Power (SHP) potential has remain largely untapped as the focus
was on large-scale power generation. In order to provide focused attention to small size projects, the subject of
small hydro was brought under the perview of renewable energy.

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The decade of 90s saw a firm footing for the development of small hydro in India. A comprehensive
programme for exploitation of its potential was built. Demonstration projects were supported throughout the
country with new technical and engineering concepts to harness small, medium and high heads for SHP projects
in hills as well as canals. R&D projects and a dedicated center namely Alternate Hydro Energy Centre
(AHEC) at University of Roorkee (now IIT, Roorkee), to provide technical support to the small hydro sector.
were supported. Database of potential SHP sites on small rivers and canals was concurrently developed. A pre-
investment study was carried out under the auspices of the Energy Sector Management Assistance Program
(ESMAP) jointly supported by UNDP and World Bank with an objective to prepare an investment program to
develop irrigation/ canal based hydro schemes. Alongside, manufacturing base for SHP equipment was
strengthened.

Against the background of depleting forest resources of Himalayas, the UNDP-GEF Indian Hilly Hydro Project
was initiated in the year 1994 as the first Indian project from GEF portfolio in order to develop a national
strategy and master plan for optimum utilization of small hydro resources of Himalayan and sub Himalayan
region with an outlay of US $ 15 million equally shared between Government of India and GEF. The project
also envisaged implementation of 20 demonstration SHP projects, design and development of watermills for
electricity generation and to develop management & ownership models through community participation. A
zonal plan for all the 13 states was evolved by identifying potential sites in the states followed by a master plan
for SHP development in the Himalayan region. First three private sector SHP projects, including one by an
NGO, in hilly areas were set up as part of this project with IREDA financing. The project succeeded in
developing concept of community participation for SHP and watermills apart from sensitizing the states,
manufacturers, consultants, NGOs etc. All these efforts lead to a firm programme of Small hydro in India.

2 HYDRO POWER CLASSIFICATION IN INDIA

Hydro power projects are generally categorized in two segments i.e. small and large hydro. In India, hydro
projects up to 25 MW station capacity have been categorized as Small Hydro Power (SHP) projects. Further,
these are classified as:

Class Station Capacity in kW

Micro Hydro Up to 100
Mini Hydro 101 to 2000
Small Hydro 2001 to 25000

Table 1: Classification of small hydro in India

While Ministry of Power in Government of India deals with large hydro projects, the responsibility of small
hydro development rests with Ministry of New and Renewable Energy.

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3 SMALL HYDRO POTENTIAL

The total hydroelectric power potential in the country is assessed at about 150,000 MW, equivalent to 84,000
MW at 60% load factor. The potential of small hydro power projects is estimated at about 15,000 MW. Of this,
4,861 potential sites with an aggregate capacity of 12,841 MW have been identified.

S.No Name of State Identified Total Projects Installed

number Capacity
of sites in MW Nos. Capacity
(MW)
1 Andhra Pradesh 377 250.50 57 178.850
2 Arunachal Pradesh 452 1243.47 68 45.240
3 Assam 40 119.54 3 2.110
4 Bihar 74 149.35 7 50.400
5 Chhatisgarh 132 482.82 5 18.050
6 Goa 4 4.60 1 0.050
7 Gujarat 287 186.37 2 7.000
8 Haryana 23 36.55 5 62.700
9 Himachal Pradesh 457 2019.03 61 141.615
10 Jammu & Kashmir 208 1294.43 32 111.830
11 Jharkhand 89 170.05 6 4.050
12 Karnataka 468 1940.31 70 441.250
13 Kerala 207 455.53 16 98.120
14 Madhya Pradesh 85 336.33 9 51.160
15 Maharashtra 221 484.50 29 209.330
16 Manipur 99 91.75 8 5.450
17 Meghalaya 90 197.32 3 30.710
18 Mizoram 53 135.93 16 17.470
19 Nagaland 84 149.31 9 20.670
20 Orissa 206 217.99 6 7.300
21 Punjab 204 270.18 29 123.900
22 Rajasthan 55 27.82 10 23.850
23 Sikkim 70 214.33 14 39.110
24 Tamil Nadu 155 373.46 14 89.700
25 Tripura 10 30.85 3 16.010
26 Uttar Pradesh 211 267.06 9 25.100
27 Uttaranchal 354 1478.24 88 80.670
28 West Bengal 141 213.50 23 98.400
29 A&N Island 5 1.15 1 5.250
TOTAL 4861 12,841.81 604 2005.345

Table 2: State wise identified sites and installed projects with capacity in MW.

A comprehensive resource assessment for all the renewable energy sources including small hydro and mapping
of potential sites/locations on a GIS platform is receiving utmost attention. The aim is to map renewable energy
potential in the country and bring it on a GIS platform with information necessary to take investment decisions

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to set up projects. Models have been developed that takes into account the regional flow duration curves,
geological and seismological data, vegetation cover etc. for identification of potential sites. The GIS
technologies to extract information on natural drops available in the river system. The water availability at
these sites is then determined using a distributed rainfall-runoff model i.e. SWAT (Soil and Water Assessment
Tool) model. The model uses terrain features, land use and soil data along with the rainfall and other
meteorological parameters such as temperature, relative humidity and solar radiation data to generate the flow
time series. The model has been successfully tested on Bias basin in Himachal Pradesh and is proposed to be
extended to other basins also.

4 SMALL HYDRO POWER PROGRAMME

4.1 Grid- interactive SHP projects

Beginning of the 21st century saw near commercialization in the small hydro sector. There are 604 small hydro
projects in India with total installed capacity of 2005 MW. The Ministry of New and Renewable Energy
decided that out of the total grid interactive power generation capacity that is being installed, 2% should come
from small hydro. This translates to about 1400 MW capacity addition during 2007-2012. The present focus of
the SHP programme is to lower the cost of equipment, increase its reliability and set up projects in areas that
give the maximum advantage in terms of capacity utilisation. SHP projects are being set up both in public and
private sector.

The Indian small hydropower development programme received a new dim ension and tempo after the
liberalization of the economy and invitation private sector for investment in power. The private sector was
attracted by these projects due to their small adoptable capacity matching with their captive requirements or
even as affordable investment opportunities. In line with Government of India policy, some states announced
their policy for inviting private sector to set up SHP projects and announced buy back rate for purchase of
power from renewable energy projects. The Indian Renewable Energy Development Agency (IREDA) started
financing private sector SHP projects. Consequent to the ESMAP study, in 1993-94, the World Bank offered a
line of credit worth US$ 70 million to IREDA to be utilized to support SHP projects on irrigation dams and
canals for a target capacity of 100 MW. The credit line moved successfully and IREDA could sanction 33 SHP
projects with an aggregate capacity 113 MW by the year 2000. Following this World Bank offered a second line
of credit worth US$ 110 million to IREDA,

Today the SHP programme in India is essentially private investment driven. 133 private sector SHP projects of
about 605 MW capacity have been setup. Private sector entrepreneurs are finding attractive business
opportunities in small hydro and state governments also feels that the private participation may be necessary for
tapping the full potential of rivers and canals for power generation. The Government of India announced the
Electricity Act in 2003, Electricity Policy in 2005 and Tariff Policy in 2006 to create a conducive atmosphere
for investments in the power sector.

With the liberalization of the economy, the Government of India has been encouraging and invited private
sector for investment in the power sector. Accordingly, a conducive policy environment has been created by
modifying the Electricity Act. The new Electricity Act-2003 deals with the laws relating to generation,
transmission, distribution, trading and use of electricity. The Act has specific provision for the promotion of
renewable energy including hydropower and cogeneration. It has been made mandatory that every state would
specify a percentage of electricity to be purchased from renewables by a distribution licensee. The National
Electricity Policy announced in 2005 aims at access of electricity by all households and per capita availability
of electricity to be increased to 1000 units by 2012. The Policy underlines that renewable energy potential
needs to be exploited and private sector would be encouraged through suitable promotional measures.
Regarding fixing of tariff, the government has announced Tariff Policy in 2006 wherein the State Regulatory
Commissions are required to fix tariff in their respective state and also decide about the renewable purchase
obligation. The Electricity Act and Tariff Policy is favourably tilted towards increasing power generation from
renewables.

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Small hydropower projects are now governed by these policies and the tariff is decided by the State Electricity
Regulatory Commissions (SERCs). The state government policies have been further refined to make them
entrepreneur friendly. 19 States in India, namely, Andhra Pradehsh, Assam, Bihar, Haryana, Himachal Pradesh,
Jammu and Kashmir, Jharkhand, Karnataka, Kerala, Madhya Pradesh, Maharashtra, Mizoram, Orissa, Punjab,
Rajasthan, Tamil Nadu, Uttarakhand, Uttar Pradesh and West Bengal have announced policies for setting up
commercial SHP projects through private sector participation. The facilities available in the States include
wheeling of power produced, banking, buy-back of power, facility for third party sale, etc. The procedure for
allotment of sites have been streamlined and made transparent. While some states continued with allotment of
already identified sites, some others even allowed identification of potential sites by the entrepreneurs
themselves. Number of financial institutions and Banks are financing the projects.

The Ministry of New and Renewable Energy is giving financial subsidy, both in public and private sector to set
up SHP projects. In order to improve quality and reliability of projects, it has been made mandatory to get the
project tested for its performance by an independent agency and achieving 80% of the envisaged energy
generation before the subsidy is released. In order to ensure project quality/performance, the ministry has been
insisting to adhere to IEC/International standards for equipment and civil works. The subsidy available from the
Ministry is linked to use of equipment manufactured to IEC or other prescribed international standards. The
equipment in the project is required to confirm to the following IEC standards.

Equipment Standard
Turbines and generator (rotating electrical IEC 60034 – 1: 1983
machines) IEC 61366-1: 1998
IEC 61116-1992
IS: 4722-2001
IS 12800 (part 3) 1991

Field Acceptance Test for Hydraulic IEC 60041: 1991

performance of turbine
Governing system for hydraulic turbines IEC 60308
Transformers IS 3156 – 1992
IS 2705 – 1992
IS 2026 - 1983
Inlet valves for hydro pow er stations & IS 7326 - 1902
systems

Recently the Ministry has given an assignment to AHEC, IIT Roorkee to revisit the existing standards and come
out with standards/manuals/guidelines for improving reliability and quality of small hydro power projects in the
country.

4.2 Decentralized SHP projects

The rural energy scenario in India is characterized by inadequate, poor and unreliable supply of energy services.
Realizing the fact that mini hydropower projects can provide a solution for the energy problem in rural, remote
and hilly areas where extension of grid system is comparatively uneconomical, promoting mini hydro projects
is one of the objectives of the small hydro Power programme in India. A number of mini/micro hydro projects
have been set up in remote and isolated areas, mainly in Himalayan region. While these projects are developed
by various state agencies responsible for renewable energy, the projects are normally maintained with local
community participation. A number of tea garden owners have also set up such micro hydro projects to meet
their captive requirement of power.

Water wheels, have traditionally been used in the Himalayan regions for rice hulling, milling of grain and other
mechanical applications. These water mills are normally of very old design and work at very low efficiencies. It
has been estimated that there are more than 1.5 lakh potential water mill sites in the Himalayan regions of
India. With the R&D efforts, new and improved designs of water mills have been developed for mechanical as
well as electricity generation of 3-5 kW. These designs were tested at AHEC, IIT Roorkee and have been

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replicated by 6-7 small scale manufacturers. Local organizations such as the Water Mill Associations,
cooperative societies, registered NGOs, local bodies, and State Nodal Agencies are being encouraged to install
watermills in their areas. A number of NGOs are now propagating water mills for electricity generation to meet
small scale electrical requirements of villages. The state of Uttaranchal has taken a lead in setting up electricity
generation watermills and over 500 such watermills were installed in remote and isolated areas of the state. A
mass movement with community participation to install electricity generating watermills is now underway in
Uttaranchal.

4.3 Manufacturing Status

India has a wide base of manufacturers of equipment for small hydro power projects. State-of-the-art
equipment is available indigenously. 15 manufacturers fabricate almost the entire range and type of SHP
equipment. Manufacturers capacity is estimated at about 250 MW per year. In addition, there are about 5
manufactures that are producing micro hydel and watermill equipment.

4.4 Technical and consultation Services

Consultancy services in the field of small hydro projects are available from a number of Government / private
consultancy organizations. The Ministry is strengthening technical institutions to provide such services.
AHEC, IIT Roorkee is providing full range of technical services in the field of small hydro including survey
and investigation, DPR preparation, project design etc. On site testing facility has been created at AHEC to test
SHP stations for their performance. A Real Time simulator has been set up at AHEC which is providing hands
on experience to operators of SHP stations. It is the first SHP simulator in the country. The simulator is capable
of replicate all conditions of a hydro power station. AHEC is offering regular training programmes for operators
and engineers of SHP stations.

With the constant efforts of the government and techno-economic viability with some preferential treatment,
small hydro has emerged as a viable business option over these years. Over 130 private sector small hydro
power projects are now operational in the country on canals as well as small rivers. It is expected that the
growth of small hydro would be @ 250-300 MW per year in the coming years. Simultaneously, micro hydro
projects have also emerged as a reliable source of electricity generation for remote and isolated areas. Efforts
are being made to strengthen hydrological data base and identify new potential sites on one side and evacuation
facilities on the other for effectively harnessing small hydro potential in the country. Trained manpower and
good equipment manufacturing base exists to cater growing needs of the sector. Appropriate selection of site
and sizing of projects to give higher plant load factors are considered important for further improve economic
viability of commercial SHP projects.