All tenders for Dibang hydropower project to be awarded by December: NHPC Ltd

Apart from ensuring energy security through renewables, India is looking at increasing its hydropower capacity in the Northeast region also because of geopolitical reasons.

After being delayed by at least a decade, the Dibang multi-purpose hydropower project in Arunachal Pradesh is finally on track with NHPC Ltd setting a deadline of December 2023 to award tenders for all its major works, RP Goyal, Director (Finance) of the miniratna PSU told Moneycontrol in an interview.

Scheduled for commissioning in 2032, the Dibang project will be the biggest hydropower project in India once ready. It will also have the tallest dam in India with a height of about 288 metres.

Currently, the 1,920 MW Koyna project of the Maharashtra government is the largest completed hydroelectric project in India.

"There are eight packages in the Dibang project, of which the first package has been awarded, which is for designing the dam. Usually, NHPC designs its own dam, but we are getting this done by experts as it will be a one-of-a-kind structure in India," says Goyal.

The second package for building the supporting infrastructure has also been awarded and L&T has already started construction work at the site to build roads and bridges connecting the project.

"Two more packages will be awarded by September. By the end of December, all eight packages will be awarded for the Dibang project," Goyal says.

The 2,880 MW project is called a "multipurpose" project because it will also help in flood moderation in the region. The Dibang river is an upstream tributary of the Brahmaputra in Arunachal Pradesh, which shares its border with China.

The total cost of the project is around Rs 32,000 crore. Of that, the Union government will fund Rs 6,500 crore towards flood moderation works. The remaining Rs 25,500 crore, will be funded by NHPC through a 70:30 debt-equity ratio.

"We won't have any issue in getting loans as we are a AAA company and we raise funds on our balance sheet. So, even if the project is delayed, we fund it from our other projects. For the 30 percent equity part, we will need Rs 800-1,000 crore every year till the commissioning of the project in 2032. This we are capable of meeting through our internal accruals," says Goyal.

The foundation stone for the project was laid by former Prime Minister Manmohan Singh in 2008. The project did not take off due to opposition from the local tribal population over their displacement, deforestation and loss of community land.

Besides, the Ministry of Environment, Forest and Climate Change (MoEF&CC) refused to give clearance for the project in July 2013, and again in April 2014 due to discrepancies in the environmental impact assessment (EIA) reports. In 2018, the project had another setback after the MoEF&CC’s environmental clearance (EC) granted to the project was challenged at the National Green Tribunal (NGT).

However, now the project has received all the necessary approvals and work has finally started this year (2023).

Subansiri hydropower project by December 2024

When asked for an update on the 2,000 MW Subansiri Lower hydropower project, which is under construction in Arunachal Pradesh and Assam, Goyal says the plant will be fully commissioned by December 2024.

By December this year, two units will be commissioned and thereafter, one unit each will be commissioned within a maximum of two months. So, by December 2024, all eight units of Subansiri Lower will be commissioned.

NHPC Ltd commenced construction work on the Subansiri Lower hydroelectric project in January 2005 after obtaining forest clearance on October 12, 2004. However, due to agitations and protests by local stakeholders, the project construction work was stalled from December 2011 to October 2019. Construction resumed on October 15, 2019, after clearance from the NGT.

Parbati-II to be commissioned in March 2024

Another delayed hydropower project, Parbati-II in Himachal Pradesh, will start operations in March next year. The 800 MW project will have four units of 200 MW each.

"We have decided to commission all units of Parbati-II at one go in March 2024. This particular project has been delayed due to poor geological strata of the area," Goyal says.

The project was started in 2003 and was scheduled for commissioning in 2010. But, it kept getting delayed due to tunnelling issues, water and silt seepage, flash floods, cloudbursts and adverse geology.

Push for hydropower projects in the Northeast

When asked about the proposed 11,000 MW Siang hydropower project in Arunachal Pradesh, Goyal says the project is still only at the "discussion stage" with the Government of India. Once finalised, the Siang project will topple the Dibang project as India's largest hydropower project.

Currently, hydropower contributes about 11 percent to India's energy mix, as per the Central Electricity Authority (CEA). Hydropower is considered a flexible generator. Unlike coal-fired plants, these units can be ramped up and down quickly in keeping with the power demand.

Apart from ensuring energy security through renewables, India is looking at increasing its hydropower capacity in the Northeast region also because of geopolitical reasons. China is on a mega dam construction spree on the stretches of Brahmaputra, called Yarlung Tsangpo there, which passes through its territory. As per government data, the Brahmaputra alone can meet 40 percent of India’s hydropower potential.