Forest Clearance Stalls NHPC's Hydropower Projects

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Researched by Industrial Info Resources India (Delhi, India)--NHPC Limited's (BSE:533098) (Faridabad, Haryana) Tawang hydroelectric projects are facing a major roadblock as India's Ministry of Environment and Forests (MoEF) has still not granted clearance to divert forest land for the construction of 1,400 megawatts (MW) of hydroelectric projects, which are proposed to be developed on the Tawangchu River in the northeast Indian state of Arunachal Pradesh.

The applications seeking forest clearance for the 600-MW Tawang I and 800-MW Tawang II hydroelectric projects are now pending for more than a year. The hydropower major first made its application for forest clearance to the State Conservator of Forests in December 2009.

The Central Electricity Authority (CEA) (New Delhi) of India has already accorded techno-economic clearances to these projects, but NHPC cannot make any further progress due to non-availability of forest clearance. In the absence of the requisite statutory clearance, NHPC has also been unable to obtain the capital approval for the projects from the Cabinet Committee of Economic Affairs (CCEA).

NHPC has now requested the Ministry to expeditiously issue the clearance so that it can initiate development work at the proposed project sites. The two hydroelectric projects have been envisaged to be developed near Jang village in the Tawang district of Arunachal Pradesh, requring an estimated investment of $2.46 billion. Tawang II would be developed 700 meters downstream of the Tawang I project. The two projects have planned construction periods of 78 months (Tawang I) and 83 months (Tawang II).

With an installed generation capacity of 5,295 MW, NHPC is India's largest hydropower utility. The company is currently pursuing clearances from the government of India for several hydropower projects with an aggregate capacity of 9,651 MW. Of these, seven projects with an aggregate capacity of 5,965 MW are planned to be implemented by NHPC on its own, while other projects are planned for execution through joint ventures.

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