The State government and the Kerala State Electricity Board (KSEB) are pressing ahead with a proposal to form a joint venture company (JVC) with THDC India Ltd. (THDCIL) for taking up new hydroelectric power projects, but the plan, reportedly, has also sparked concern and scepticism in KSEB circles.
The JVC will conceptualise, implement, operate and maintain hydropower projects within Kerala, according to a draft memorandum of understanding drawn up by the KSEB planning wing. Equity in the JVC would be held by the Kerala government, THDCIL (formerly the Tehri Hydro Development Corporation Ltd.), and the KSEB in a 15:45:40 ratio, respectively.
Eligibility for energy
As per the plan, the JVC would be incorporated as a public limited company. Each party would be eligible for energy generated from the JVC-built plants in proportion to its equity holding. The Kerala government will be eligible for 15% of the total generated energy as ‘free power.’ The KSEB will have the right of first refusal on the generated power.
Further, the draft also mentions that an ‘Assets Transfer Agreement’ whereby the KSEB and the THDCIL would transfer assets to the JVC would be executed ‘‘in due course of time.’‘
Eyeing untapped hydro potential, the State Power Department has lined up a bevy of medium to big hydel projects. The department has proposed joint ventures with central public sector companies on the assumption that the JVs would help it obtain statutory clearances quickly and commission the projects on time. The KSEB has already inked an MoU with THDCIL for preparing a detailed project report for two pumped storage projects (PSP) in Idukki district.
Employees worried
The MoU, once executed, would initially be for a period of five years, with an in-built provision for extensions by mutual agreement. Several of the draft proposals have triggered apprehension in the KSEB staff, prompting senior officials to air their fears at an official meeting held last week.
Concerns chiefly centre around equity, the proposed Assets Transfer Agreement, valuation of KSEB assets, the profit-sharing model and, in particular, the future of hydel projects in the KSEB, a senior official said. There is a lack of clarity on whether all future hydro projects would be handled by the JVC, the official said.
Additional generation
According to the power department, Kerala has ample scope for additional hydel generation as only 10% of the annual water availability of 3000 TMC is being used for irrigation and power generation.
Big hydel projects on the KSEB list include the 800 MW Idukki Golden Jubilee Power House Project, the 300 MW Moozhiyar Phase-II, the 240 MW Letchmi, and the 210 MW Pooyamkutty project. Last year, Electricity Minister K. Krishnankutty had informed the Union Power Ministry that Kerala was ready for joint ventures in hydropower and solar energy projects.
