The Cabinet Committee on Economic Affairs (CCEA), on April 27, 2022, approved an investment of Rs.4526.12 crore for setting up the Kwar hydropower project in the UT of Jammu & Kashmir.
The 540-mw Kwar hydropower project, located on river Chenab in Kishtwar district, will be set up by Chenab Valley Power Projects Pvt Ltd — a joint venture company between NHPC (equity: 51 per cent) and Jammu & Kashmir State Power Development Corporation (49 per cent).
The project with four units of 135-mw each, to be commissioned within a span of 54 months, shall generate 1,975.54 million units in a 90 per cent dependable year. Electricity generated from the project will help in balancing of grid and will improve the power supply position. The foundation stone for the Kwar hydropower project was laid at the hands of Prime Minister Narendra Modi, on April 24, 2022.
Sources of finance
Government of India is extending grant of Rs.69.80 crore towards cost of enabling infrastructure and also supporting the UT of J&K by providing grant of Rs.655.08 crore for equity contribution of JKSPDC in CVPPPL. NHPC shall invest its equity of Rs.681.82 crore from its internal resources.
Project viability
Government of UT of J&K to make the project viable, extending exemption from levy of water usage charges for 10 years after commissioning of the project, reimbursement of State’s share of GST (i.e. SGST) and waiver of free power @2% per year in a decremental manner. Accordingly, free power to UT of J&K would be 2 per cent (of total generation) in the first year after commissioning. This will progressively increase, in steps of 200 bps, to reach the final figure of 12 per cent, from the sixth year onwards.
Benefits to UT of J&K
Project construction activities will result in direct and indirect employment to around 2,500 persons and will contribute in overall socioeconomic development of the UT of J&K. The UT be also benefit from free power of around Rs.4,548.59 crore and Rs.4,941.46 crore with water usage charges from Kwar hydropower project, during project life cycle of 40 years.
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CVPPPL
Chenab Valley Power Projects Pvt Ltd, incorporated in June 2011, as a 51:49 joint venture between NHPC and JKSPDC, is entrusted with the development of various hydropower schemes in the UT of J&K, including Kwar (540 mw), Kiru (624 mw) and Dulhasti (540 mw)—all located in the Chenab valley. It may be mentioned that at the time of the CVPPPL’s incorporation, PTC India held 2 per cent equity with the other two entities holding 49 per cent each. In around May 2021, NHPC acquired the entire shareholding of PTC India, making CVPPL a subsidiary of NHPC.
Featured photograph shows a view of the Kwar hydropower project site in Kishtwar district of UT of J&K. (source: unknown)
