Friday, July 31, 2009

Government White Paper on Hydro Power in Sikkim


Sikkim Government White paper recommends expeditious harnessing of 8000 MW hydro potential of Sikkim

GANGTOK, July 30: A voluminous white paper on hydropower resources of Sikkim tabled by the State Government in the State Assembly today has opined that Sikkim must expedite the development of its 8000 MW hydropower resources as the ‘only way out’ to meet the Millennium Developmental Goals set forth.“The considered opinion emerging from the analysis of this report is that Sikkim must expedite the development of its hydropower resources at a faster pace. Utilize the hydropower revenue for the social, educational, economic and other developmental aspects of its people. That is the only way out, if Sikkim wants to lead other States in the country in speedy development and meeting the Millennium Developmental Goals set forth”, states the white paper tabled by State power minister Sonam Gyasto Lepcha on the concluding day of the budget session today in the Sikkim Legislative Assembly.Prepared by Entecsol International, the 209 pages white paper in its executive summary said that the white paper on the development of hydropower resources of Sikkim is aimed at examining the State of economy, hydropower resources and the status of their development in Sikkim.The white paper claims that it also examines the steps taken by the government for facilitating and expediting the development of its hydropower resources and the constraints, issues and challenges faced by the government in exploiting this resource. It evaluates the potential financial and economic benefits that Sikkim can harness from the development of its hydropower resources and exporting the surplus energy to other parts of the country.Out of the total hydropower potential of Sikkim of 8000 MW, the total installed capacity as on March 31 this year is only 610.7 MW.The State government has awarded 24 hydropower projects at a total estimated installed capacity of around 4,694 MW to various developers out of which, 2,081 MW is expected to be commissioned within the 11th Plan and remaining within the 12th Plan.All the projects are run of the river schemes.In its recommendations, the white paper called for immediate structural changes in the State power sector for efficient management of the Sikkim power sector coupled with the need to manage a quantum jump in the development of hydropower resources from the existing level of about 200 MW to 8000 MW. The white paper has recommended that the State government should establish two corporate bodies fully owned by the State government-Sikkim Hydro Power Corporation Ltd (SHPC) and Sikkim Transmission and Distribution Corporation Ltd (SPDCL). It has also recommended that Sikkim Power Development Corporation Ltd which has not met the objectives for which it was set up should be wound up by transferring its assets to SHPC.The SHPC will manage all the existing generation stations in the State and also handle the entire power allocation, sale and purchase of electricity presently handled by the State power department, the white paper recommends.On the other hand, the proposed SPDCL will manage the existing and the proposed transmission and distribution systems in the State.“The State should also come out with its Hydro Power Policy as suggested in the conclusions and recommendations chapters of this report”, states the white paper. It has also recommended that a State level Rehabilitation and Resettlement Policy that matches the provisions in the Central government’s concerned policy should also be formulated.“An Independent Monitoring and Evaluation Team (IMET) as detailed in the report should be constituted immediately to provide the government with an independent assessment about the project execution and to work as an impartial link between various stakeholders and the government”.Regarding the harnessing of the balance potential of about 2736 MW which is yet to be awarded, the white paper has suggested that creating of shell companies by SHPC which will then award the projects after international competitive bidding. The white paper has stressed on the immediate need to set up a Project Review Committee to review the review the projects made by the developers in the establishing the projects already awarded.“Projects where the progress is not matching with the targeted milestones as envisaged in the MoUs/project award agreements should be cancelled”.The white paper has also recommended the State Government to reinvestigate the Chungthang region in North Sikkim where the Ministry of Environment and Forests have asked the State Government that projects above Chungthang region should not be considered for construction of dams due to its vast biodiversity. The State Government cannot abandon projects with 1050 MW capacity that have been awarded to the developers without a proper examination of the issues, the white paper said.The State Government should, therefore reinvestigate the region to find the factual position and arrive at the final decision with regard of the development of these projects, the white paper recommends.The State Government has also been suggested to give priority to development of wind and solar energy projects for serving the rural masses living in the deep mountainous region.The white paper in its genesis of protests against hydropower development in Sikkim has attributed it non-involvement of the locals in the identification of proposed projects.“For many of the local stakeholders who are affected (or likely to be) by these projects, the entire issue of power projects came like a bolt from the blue as they are clueless about, who was doing it and why and what will they get. The communication gap and absence of participation of local stakeholders was a major institutional failure, which could have been avoided through a massive awareness campaign before launching these projects”, the white paper said pointing to the protracted hunger strike carried out by anti-hydel body Affected Citizens of Teesta as a blatant example of this institutional failure.One upfront challenge that needs to be met head-on by the State Government is to strike a fine balance in the developmental needs of the State, the natural resource need and biodiversity management, conservation of socio-cultural ethos and sustainability of ecological balance. The confidence in the minds of the people must also be instilled by adopting a fair-handed approach in developing the hydropower resource by issuing a State level Hydropower Policy.Regarding the major issue of land procurement for the hydro projects, the white paper states the total land required for projects in North Sikkim is just 0.29 percent of the available land in North Sikkim.The white paper also states that Sikkim will be getting annual revenue of Rs. 1337.79 crores during the first 15 years after the projects of current 4694 MW which is being developed is commissioned. In addition, the State government will earn about Rs. 22.3 crores as cess annually and Rs. 178.368 crores per annum as sale proceeds of 1 percent free power for local area development, the white paper adds.These projects in Sikkim would provide employment to 3000-5000 skilled persons, 6500-10000 semi-skilled persons and 6500 to 10000 un-skilled persons.The report has concluded that despite enormous advantages appreciated by all, there are undercurrents of dissatisfaction, misplaced apprehensions and misunderstandings created by lack of effective information flows. While genuine concerns need to be addressed immediately, the wrong apprehensions should be warded off by proper briefings, public hearings and disseminating the information and the steps taken by the government to address the issues, it is suggested.In the backdrop of the national need for growth of electricity sector to 12 percent per annum, the white paper has concluded that Sikkim has to expedite the development of its 8000 MW hydropower potential so that then nation, state and locals benefit.