In a stock exchange filing, NHPC announced that a joint venture company “Ratle Hydroelectric Power Corporation Limited” for implementation of the Ratle hydropower project in Union territory of Jammu & Kashmir has been formed.
The filing said that the JV company, incorporated on June 1, 2021 will be owned by NHPC (equity: 51 per cent) and Jammu and Kashmir State Power Development Corporation Ltd (equity: 49 per cent).
The 850-mw Ratle hydropower project will be developed on the Chenab River basin in the Union territory of J&K.
Background
- In April this year, NHPC informed that a promoters’ agreement has been signed on April 13, 2021, between NHPC Ltd, Jammu & Kashmir State Power Development Corporation Ltd (JKSPDCL) and Government of Union Territory of Jammu & Kashmir, for implementing the 850-mw Ratle hydropower project in Jammu & Kashmir. Accordingly, a new joint venture called “Ratle Hydroelectric Power Corporation Ltd” will be formed with two partners — NHPC (equity stake: 51 per cent) and JKSPDCL (equity stake: 49 per cent).
- On January 3, 2021, NHPC signed a supplementary MoU with JKSPDCL) and Power Development Department, Government of UT of Jammu & Kashmir, for implementation of the 850-mw Ratle hydropower project in Jammu & Kashmir UT, through a proposed joint venture.
- In the supplementary MoU, the clause of the original MoU dated February 3, 2019, regarding purchase of NHPCs equity by JKSPDCL were deleted. Accordingly, the share of NHPC in the joint venture company shall not be brought below 51 per cent and the share of JKSPDCL shall not be brought below 49 per cent. According to the clauses in the original MoU of February 2019, the equity participation of NHPC and JKSPDC were to be in the ratio 51:49, which still holds true. However, the original MoU envisaged that the equity of NHPC shall be purchased at book value by JKSPDC from the end of the fifth year after the date of commissioning over a period of 15 years, through equal installments. This would have gradually lowered NHPC’s equity in the JV, over the years, from the original 51 per cent.
Project Profile
The 850-mw Ratle hydropower project is a run-of-river scheme over River Chenab in Kishtwar district of UT of J&K. The project is covered under the Indus Water Treaty 1960 between India and Pakistan. The project with an installed capacity of 850 mw (4×205 mw + 1×30 mw) shall generate 3,137 million kwh in a 90 per cent dependable year. The expected completion cost of the project is around Rs.5,300 crore. The project will have a levelized tariff of Rs. 3.92 per kwh.
Original developer exits
The project was initially awarded under the tariff-based competitive bidding route to GVK Group, in 2010. However, GVK abandoned the project in 2014 owing to issues relating to tariffs. GVK Group has started physical construction work on the project. The foundation stone for the project was laid by then Prime Minister Dr Manmohan Singh, in June 2013 and it was then scheduled for completion in 2020.
Similar JVs for J&K Projects
NHPC, it may be mentioned, already has a JV for other hydropower projects in UT of J&K. Named Chenab Valley Power Projects Pvt Ltd, it has equity participation from NHPC (49 per cent), JKSPDCL (49 per cent) and PTC India (2 per cent). CVPPPL is currently developing the 1,000-mw Pakal Dul, the 624-mw Kiru and the 540-mw Kwar hydropower projects in UT of Jammu & Kashmir. This joint venture will also be developing the 540-mw Dulhasti (Stage 2) project on which survey and investigation works are currently underway.
(Featured photograph for illustration only)
