New Delhi: SJVN Limited, a Mini Ratna, Category-I and Schedule –'A' CPSE, has plans to put in place pumped hydro storage projects of 5 GW in the next 7-10 years, said its Chairman and Managing Director (CMD) Nand Lal Sharma on Tuesday. Elaborating on the PSU’s plans for Pumped Storage Projects (PSPs), Sharma said, “The target that we have fixed for ourselves is anywhere around 5,000 MW capacity in 7-10 years.” The construction of these projects would entail an investment of Rs 50,000 crore, the CMD added.
“The project cost comes to around Rs 10-12 crore/MW in hydro projects including PSP. So, 5,000 MW means Rs 50,000 crore investment,” said Sharma.
Pumped hydro storage projects or PSPs are basically a combination of two water reservoirs at different elevations. Power is generated as water moves down from the higher reservoir to the lower one while passing through the turbine. The facility functions as a storage when power is used to pump water back from the lower reservoir to the upper reservoir, where it is stored and released when power needs to be generated. Therefore, it functions like a giant battery storage system.
In the time that other kinds of battery energy storage systems become ready for commercial deployment, India is eyeing the development of 18 GW of PSP projects by 2032 to address the issue of intermittency of renewable energy.
The SJVN CMD said that the PSU has been given 10 pumped hydro storage projects of 12,790 MW capacity by the Central government in various states. Out of 10, six are planned to come up in Maharashtra, while the rest are to come up in Himachal Pradesh and Mizoram. “Out of the six projects that have been allocated to SJVN in Maharashtra, five are located in wildlife sanctuaries, where it is not feasible to construct these projects. But we are undertaking feasibility studies in all the other locations. And wherever we find it to be viable, we will be constructing those projects,” said Sharma.
Water cess will result in an increase in power tariffNand Lal Sharma, SJVN CMD
Commenting on the issue of water cess, Sharma said that the impact will be an increase in power tariff, which will be passed on to discoms as is spelled out in Power Purchase Agreements (PPAs). The statement assumes significance as it comes in the backdrop of a heated discussion over the levying of water cess.
The Himachal Pradesh Assembly has passed the Himachal Pradesh Water Cess on Hydropower Generation Bill, 2023, on March 16 this year. The legislation is facing challenge in the Himachal Pradesh High Court — Nanti Hydro Power vs State. While state governments are reluctant to forego a crucial source of revenue to them, gencos are pleading before the court that the levy of such a cess will make their projects financially unviable. On April 27, the Central government also wrote a stern letter to the states against the practice of levying of water cess on hydro power projects, calling it unconstitutional. It asked all state governments to ‘promptly withdraw’ any such cess being levied on hydro power projects.
Discoms and power utilities are not favouring long-term PPAs because the initial cost of hydro projects is quite highNand Lal Sharma, SJVN CMD
Sharma also said that discoms and power utilities are preferring short-term PPAs over long-term as they are increasingly looking to use hydro power to balance the intermittency of solar and wind energy projects. “For PPA, we are having discussions with different discoms on various models. We will not go for long-term PPAs because it has been seen that the requirement of hydro projects is going to be there in the time to come in conjunction with renewable energy to balance out the intermittency. Even discoms and power utilities are not favouring long-term PPAs because the initial cost of hydro projects is quite high. But we are thinking of models like RTC (Round-the-Clock). By bundling (hydropower) with solar and wind or other unallocated power from projects, we will give a complete solution to discoms,” said Sharma.
Flagging climate change as a serious concern whose impact has become more pronounced over time, the SJVN CMD said that a trend of erratic precipitation, low water discharge (for hydro power projects) and wind velocity (for wind power projects) is increasingly becoming prominent. “Out of the four quarters (in FY23), the Q1FY23 was the better one in terms of discharge in the river and precipitation. But for the remaining three quarters, the precipitation and discharge in the river was very less due to climate change. There was lesser snowfall in the higher terrains of the mountains and monsoon was also not evenly spread. And a similar trend is being observed this year as well until now as the discharge and generation is as low as 55 percent as compared to the last year,” said the SJVN CMD.
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