INDIA

RIVER BASIN DEVELOPMENT

OPTIMISATION STUDY A study carried out for the World Bank at the request of the

Government of Himachal Pradesh and Government of Uttarakhand

FINAL

RECOMMENDATIONS

REPORT

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EXECUTIVE SUMMARY

As India attempts to achieve very ambitious targets in developing hydropower over the next

decade, the challenge is very much on the Himalayan states, particularly Himachal Pradesh

and Uttarakhand. In undertaking the River Basin Development Optimisation Study, the Study

Team has identified numerous shortcomings in the planning and coordination of hydropower

development, noting the bias to the project as the unit of development, and the lack of

coordination among developers and concerned agencies, which works against capturing the

full benefit of a cascaded system.

Taking the Satluj and Alaknanda basins as case studies, it was noted that:

There are substantial geological risks associated with hydropower development in the

Himalayan region, with no mechanism for shared knowledge management.

Hydrological risk is high, given the relatively short period of observations, and the

obtaining of existing data is very problematic.

Methodologies for determining design floods vary from project to project. This

inconsistency could lead to under or over designing of spillway capacities for the

various projects in a cascade, or a dam with adequate spillway capacity could be

vulnerable to the cascade dambreak potential from the failure of an upstream dam

with inadequate spillway capacity.

Silt is a major obstacle to hydropower development in the Himalayan region, and

threatens to undermine the viability of the hydropower investments unless more

effective measures for silt management are developed.

Simple modelling shows that optimisation of a cascade of hydropower projects results

in greater energy output and less physical footprint than the currently planned

designs and operational plans.

An upstream storage will bring benefits to existing and planned downstream projects

via regulated flow releases, flood control, and sediment trapping.

There is a multitude of developers, which works against the coordination that is

critical to ensuring efficient implementation of projects.

There is confusion amongst developers as to the details of the regulations proposed

but not enacted by the State Government regarding the design and operation of their

hydropower projects. This confusion is being compounded by press reports of the

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pending new hydro policy of the Central Government.

Many of the private developers are new to hydropower, and have questionable

understanding of the fundamental commercial risks that arise, and of the market

environment, eg absence of a peaking power tariff.

The already challenged road network faces severe problems, especially with

uncoordinated hydropower construction schedules.

The poor state of public communications and public awareness of what is going to

happen has lead to increased anxiety that could lead to resistance to projects.

The environmental flow requirements are unclear � is it 15% of the flow at any given

time, 15% of the minimum flow in the lean season, 15% of the minimum flow ever

recorded? It appears that the environmental flow requirements have not been

developed with an understanding of the biodiversity of the particular river basins or

the needs, if any, of the downstream population.

There is often a gap between Environmental and Social Development Plans and their

implementation.

There is variable success with Catchment Treatment Plans and compensatory

afforestation and concern regarding direction of funding and activities away from

locally impacted areas.

There are considerable risks to the fragile Himalayan ecosystem.

Many, if not most, of the abovementioned shortcomings can be addressed to some degree

through a river basin approach to planning and implementation of hydropower projects.

Analysis of the available feasibility studies and related reports for the Satluj and Alaknanda

hydropower projects, some simple mathematical and qualitative modelling, consultations with

the various stakeholders in hydropower development, and reference to international practice,

suggest the advantages of developing a framework for efficient hydroelectric power

development at the level of the river basin, as distinct from the current individual project level.

River basin development optimisation (planning, design, development and operation) is

better done at the river basin level because:

Hydrological yield estimation can be vastly improved by the coordinated gathering,

storage, and dissemination of hydrological and meteorological data to developers. In

particular the effects of climate change can be estimated by central studies, without

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individual developers either ignoring this important aspect or undertaking their own

individual varying studies.

Mathematical models of basins can be developed so that the effects of one project in

a cascade on another are fully understood, and optimisation of design and operation

of a cascade of projects can be achieved.

A storage at the upstream end of a cascade can be investigated to determine the

balance of benefits in terms of flow regulation, flood control and sediment trapping

against any negative aspects related to the environment or affected local population.

There can be consistency in determination of design floods, and flood prediction and

warning systems can be installed on a basin-wide basis.

Development and sharing of infrastructure can be coordinated so as to minimise

strain on such infrastructure as main roads, access roads, construction power and

transmission lines for evacuation of power.

A strategic environmental assessment of an entire basin can be undertaken to

establish baselines and objectives, setting the context for project specific EIAs.

There can be standardisation and sharing of water quality measurements.

Panchayat representatives can have far greater involvement in the developments

within their basin through, for example, monitoring of the Catchment Area Treatment

plans and other plans to mitigate the social and environmental impacts of

development.

Standardisation and monitoring by various stakeholders of Catchment Treatment

Plans will be greatly enhanced.

Sustainability flows for various stretches of river within a basin can be determined on

a scientific and social needs basis, taking due cognisance of the biodiversity of the

basin.

Benefit sharing amongst all stakeholders can be far more equitable and better

managed.

It is important to note that there are some encouraging recent developments in the move

towards river basin planning, particularly in the area of project optimisation. There have been

some recent instances of optimisation by developers and State Governments involving a

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small number of projects along limited stretches of river � the proposed integration of Jangi

Thopan and Thopan Powari projects on the Satluj in Himachal Pradesh, and the optimisation

of projects on the Pindar and adjacent Alaknanda rivers in Uttarakhand. While encouraging,

these cases underscore the need for a more systematic approach to basin optimisation, to

ensure benefits to all developers, impacted communities and the State Government.

While a number of issues are covered in this report, it is not intended to be a complete

analysis of impacts and issues in the hydropower industry in the subject basins or India in

general. There are a number of issues and risks which are not dealt with in this report but

this does not mean that they are not important aspects for future development of

hydropower. However, the study and the report are focused on the main issues where a river

basin planning approach can play a clear role in improving sustainable development �

financial, environmental, and social outcomes.

This Recommendations Report makes numerous recommendations and suggestions to

enable hydropower development in India to move towards river basin level planning, design

and operation. The underlying themes of these recommendations are:

There is a need for data sharing amongst the developers and government authorities,

particularly related to meteorology, hydrology and sedimentation.

There is a need for improved methods of yield estimation, which has a fundamental

impact on project economics.

There is a need for significant improvement in coordination between developers, in

terms of shared infrastructure such as access roads, construction power, and power

evacuation transmission lines.

It is desirable to integrate communities and qualified third parties (NGOs) in aspects

of project monitoring such as use of community forests, Resettlement Action Plans,

etc.

The Study Team presented some of the key recommendations at a workshop on 1st

November, 2007 where senior government figures presented the visions for their states and

representatives from government, private developers, and non-governmental organisations

contributed to discussion on the issues. The key recommendations are summarised below

and appear in more detail in the body pf the report:

1. Establish uniform and easily available data sets for hydrology, topography,

sedimentation, ecology, and social and economic activity.

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2. Standardise methods for energy assessment (not 90% dependable year) and Design

Flood Analysis (using extreme rainfall methods)

3. Implement a basin operations model for real-time scheduling and for flood

forecasting.

4. Reassess issues associated with the proposed storage at Khab to determine a

decision making process, and develop an action plan to move forward.

5. Provide a co-ordinated approach to sedimentation at the basin level which could

include data sharing and cooperative research, consideration of alternative design

assumptions such as cost-benefit of removing smaller than the current minimum 0.2

mm particles, and improvements to sediment control during construction.

6. Develop Master Plans for infrastructure (roads, transmission) to optimise benefits and

minimise costs and impacts.

7. Undertake basin wide environmental and social assessment to determine high value

areas in basins where hydropower is planned.

8. Develop plans to collect relevant data and identify objectives across the two basins

for the eventual establishment of sustainability flows.

9. Develop a basin-wide benefit sharing options and priorities paper and incorporate

requirements with EIA/SIA social analysis requirements and consultation processes

for individual projects.

10. Developers to consider aggregating benefit-sharing expenses for large ticket items

and state governments to consider contributions from the 12% free power.

11. Develop basin-wide plan, with sequenced priorities linked to water management

issues for developers (eg. upstream) and local input

12. Identify basin-wide CAT opportunities projects (eg. Satluj study)

The question arises: who will initiate and act upon these recommendations, and how will they

be funded. Suggested responsibility for the recommendations is provided in the main body of

the report. Many recommendations can be taken on board as part of either improving current

practice, or as steps toward the river basin planning approach. Implementing a completely

new system via River Basin Authorities would require considerable time, and it is important

that positive actions are taken as soon as possible without delaying the hydropower

development program.

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A move towards river basin planning could include:

Informal, cooperative development of databases and tools to facilitate river basin

considerations in project planning and implementation, which could be formalised

through a central agency or independent body for the ongoing maintenance of data

integrity.

Establishment of a developers� forum similar to that for the Satluj, although with

stronger participatory requirements and supporting mechanisms for data sharing and

decision-making.

Redefinition of responsibility and funding of a program through a lead agency to

facilitate river basin planning and development.

Establishment of a new institution, with legal mechanism to establish representative

membership and to provide clear responsibility for river basin planning.

The last option is effectively a mandated River Basin Development Authority. Each such

Authority could have representation from all stakeholders and be chaired by a person without

vested interest, other than overall optimised development of the basin in question.

Membership of each Authority could change as development progresses, eg as projects are

allocated to new developers then such developers could have representation. NGOs and

representatives of people living in the basin could have membership, as well as the

developers and relevant technical organisations such as Public Works and Transmission

companies.

The Chairmen of these Basin Authorities could meet regularly with Government so that there

is consistency of approach across the State. A single State Authority is not recommended

because it would be very difficult for the local people with specific issues to be involved.

Funds to operate these Authorities could come from the upfront premiums paid by

developers to the States, and from the revenue emanating from the 12% free power royalty.

Discussion and feedback from the Recommendations Workshop held on November 1st gave

strong support to river basin planning approaches with some caution noted with regard to the

amount of changes required. State government representatives noted the importance of

establishing strong mechanisms for river basin planning that incorporate input from NGOs

and communities, with the suggestion that the development of independent Authorities with

powers to act was required. Workshop participants also strongly supported coordinated data

collection and analysis and it was noted that improvements could be made in transparency

and availability of data through an independent or centralised organisation. Again, the role of

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local communities could have in data collection and monitoring programs was noted as an

opportunity.

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CONTENTS EXECUTIVE SUMMARY i

1. INTRODUCTION 1

1.1 River Basin Planning � An Opportunity for India 2

1.2 Stakeholder Consultation 2

2. RECOMMENDATIONS 4

2.1 Yield Estimation in Project Design 4

2.2 Production Optimisation and Interface of Cascade Schemes 6

2.3 Sedimentation and Water Quality 9

2.4 Storage and Regulation of Flow 10

2.5 Environmental (Sustainability) Flows 13

2.6 Flood Risk Assessment 15

2.7 Multiple Development of Associated Infrastructure 17

2.8 Preparation of adequate and strategic Environment and Social Impact Assessments and Mitigation Plans 19

2.9 Implementation of Catchment Treatment Plans and Compensatory Forestry 24

2.10 Development and Implementation of Environmental and Social Management Plan Activities 25

2.11 Benefit Sharing 27

2.12 Local Participation in Project Delivery 29

2.13 Development and Implementation of Resettlement Plans 31

2.14 Impacts to Culture and Heritage 33

2.15 Policy Integration 35

3. CONSIDERATIONS FOR THE FUTURE 36

3.1 Examples of River Basin Planning 36

3.1.1 India 36 3.1.2 International 37

3.2 Implementing River Basin Planning in India 42

4. REFERENCES 45

5. GLOSSARY 46

APPENDIX 1 � STUDY AREA 48

Satluj Basin 48

Alaknanda Basin 53

APPENDIX 2 � INDIAN REGULATORY CONTEXT 59

Uttarakhand Hydropower Policy 59 Himachal Pradesh Hydropower Policy 59 Project Approvals 61

APPENDIX 3 - CONSULTATION 63

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1. INTRODUCTION

Availability and reliability of electricity supply in India continues to be a major obstacle to

India�s development, restraining economic growth and impeding potential for poverty

alleviation. One of the Government of India�s top priorities is to provide all its citizens with

reliable access to electricity by 2012, requiring an estimated 100,000 MW of additional

generating capacity to be installed which is about four times the amount added during the

last Five Year Plan.

The Government of India has decided that hydropower has the potential to provide a

considerable portion of this additional power requirement, increasing percentage of total

generation from 26% to 40% by 2012.

The governments of Himachal Pradesh and Uttarakhand recognise the substantial

hydropower potential of their states and have developed ambitious hydropower programs.

Himachal Pradesh has more than 20,000 MW of identified hydropower potential (25% of the

whole of India) with less than 7,000 MW installed to date. Uttarakhand has a hydropower

potential of the order of 20,000 MW, of which less than 3,000 MW has been harnessed to

date.

The States are responsible for generation of electricity within their borders and each State

has its own Hydro Power Policy and regulations, see Appendix 2 for details. However the

Central Government also has a Hydro Power Policy, with recent press reports indicating that

a revised policy is soon to be released.

At the request of the Government of Himachal Pradesh and the Government of Uttarakhand,

the World Bank (with funding from the Public-Private Infrastructure Advisory Facility) initiated

the River Basin Development Optimisation Study to demonstrate a framework for efficient

hydroelectric power development at the level of the river basin. The World Bank contracted

Hydro Tasmania Consulting to undertake the Study which reviews the plans for the

development of the Satluj River and Alaknanda River basins in order to explore the benefits

of the river basin approach to hydropower development and operation for these two river

basins. Details of these two basins, and the planned hydropower developments, are given in

Appendix 1. The intention is not to change what has already happened in the Satluj and

Alaknanda basins, but rather, to suggest improvements to existing practices in planning and

implementation of the hydropower development program in each State with the goal of

ensuring the long-term sustainability of this important development. More generally, it is

hoped that study recommendations may be usefully applied to the development of other river

basins.

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The study produced an Inception Report and an Issues Paper which discussed many issues

associated with the current project-based approach compared to a river-basin-wide approach

to hydropower development in the Satluj and Alaknanda basins. Some of the more important

issues have been modelled so as to identify technical and operational impacts, as well as

environmental and social implications of multi-project development. The modelling results

were presented at a Seminar on 6th July 2007 and a Modelling Report was produced taking

into consideration feedback from attendees.

This Final Recommendations Report integrates the various aspects of the project, including

description of issues, modelling results, feedback from consultations regarding the potential

for river basin planning, and interactive discussion and debate at the Final Workshop held on

1st November 2007 attended by more than 80 participants.

1.1 River Basin Planning � An Opportunity for India

Since its inception, river basin planning has been taken up in many countries and has

evolved to encompass a number of different institutional models, with various developmental

emphases. In the latter part of the 20th century, the philosophy of river basin development

underwent significant changes shifting from solely engineering approaches to encompass the

values of biodiversity, non-structural means of improved water management, and

stakeholder participation in sub-basin scale initiatives.

Environmental and social groups have been instrumental in promoting the incorporation of

social and environmental issues into river basin planning programs around the world. These

include resettlement of indigenous communities, fish migration, and protection of natural

flood cycles. A new generation of river basin planning is thus emerging with a holistic

approach that seeks to integrate potential environmental and social costs into the planning

and implementation process.

This rich worldwide experience provides India with an opportunity to incorporate into current

practice in the hydropower sector a holistic approach to river basin development that will help

serve the country�s national development goals while promoting sustainable, equitable

development on the local and regional levels.

1.2 Stakeholder Consultation

Wide-ranging consultations have formed an integral part of this study because consultations

help capture the many facets of this complex development program and bring out problems

that can be addressed upfront and avoid �surprises� later on that could threaten the

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sustainability of the development. Representatives of government agencies, hydropower

developers, scientific institutions and universities, non-governmental organisations (NGOs),

and the local people affected by the developments were consulted because they have direct

experience with the hydropower industry - they will be the key stakeholders in the

hydropower future of India, and of Uttarakhand and Himachal Pradesh in particular.

Consultation has been carried out during the course of the project for establishing the key

issues, collecting and discussing available data, discussing past and proposed projects and

obtaining opinions and ideas regarding the potential role for river basin planning in the

development of hydropower.

Local communities are a critical stakeholder in the hydropower development program. While

it was not possible as part of this study to consult widely with local communities that have

been, or who may potentially be, directly affected by current or future projects, a number of

views were put forward on their behalf by those working closely with such communities.

Comments, opinions and ideas from these consultations (including the Modelling Workshop)

are referred to throughout this Report. A list of organisations and people consulted during the

project is provided in Appendix 3.

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2. RECOMMENDATIONS

Recommendations arising from the analysis and consultations carried out in the course of

the study are presented for consideration by the governments of Uttarakhand and Himachal

Pradesh, the Government of India, concerned developers, project-affected communities and

other stakeholders. The recommendations have been drafted in such a way that there are

suggestions that can be taken on board as part of either improving current practice, or as

steps toward river basin planning approach, without necessarily launching into a completely

new system.

There are opportunities to improve the outcomes associated with the issues, regardless of

whether a river basin planning approach is adopted. In many cases, these opportunities

relate to economic, environment and social benefits that can be achieved through improved

processes, data collection and access, or involvement of key stakeholders.

A comprehensive river basin planning approach is a major undertaking that could realistically

take a number of years to establish the relevant baselines, skills and tools, guidelines, and

operating framework for its implementation. There are a number of challenges in the existing

system and current practice of developing hydropower projects in India influencing the

likelihood of effective implementation of a river basin planning approach. These include the

number of agencies currently involved, the time and negotiation required for changes to legal

instruments, bureaucratic processes and need for substantive changes or streamlining, the

limited skills and tools available, and the need for increased resources (people and funds) to

implement actions.

However, a river basin planning approach can be achieved to varying degrees and in a

phased way through, for example, uptake of strategic regionally based economic, social and

environmental assessments, as well as basin wide yield estimates and establishment of

wider development or benefit sharing activities in the host regions.

Funding for some of these initiatives, including potential River Basin Authorities, could come

from the upfront premiums paid by developers to the state governments, and from the

revenue emanating from the 12% free power.

2.1 Yield Estimation in Project Design

Current practice for the analysis of hydro power output, as indicated from examination of

feasibility reports for the Satluj and Alaknanda basins, is to consider only local at-site data for

derivation of water yield. Often the flow sequences used to derive a yield are based on

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transposition of limited length data from another site or from a site that has already been

transposed. Only estimation based on area scaling is used and often only 10 daily mean

flows or 3 flow values per month are used making the yield estimation less reliable.

A significant part of both basins is covered by snow and glaciers (in some cases more than

50% of the catchment to a proposed dam site is snow covered), however in only a few

cases, is there any special consideration given to yield estimates from these areas. For the

run-of-river hydro power projects this is an important issue due to the highly seasonal nature

of the snow and glacier runoff.

Generally, the studies carried out do not consider either upstream or downstream impacts of

either water storage or operating rules when considering yield. One report reviewed did

consider one power scheme immediately upstream but none considered the basin as a

whole.

The methods used for yield determination are basic, relying in most cases on the minimum

expected guidelines from CWC of determination of the 90% dependable year. Even in some

studies where a moderate amount of storage is being considered, usually only the 10 daily

flow sequence for just the 90% dependable year is used in a simulation of power production

rather than the whole of the available flow sequence.

The use of data from just one year (90% dependable year) may provide a biased estimate of

the water yield and hence produce unreliable energy estimates, as the data from one year

may be highly skewed depending on the nature of the higher flow in the snow melt and

monsoon seasons.

From an assessment of the available records it would seem that the use of the standard

Hydrological Year for India (1st June to 31st May) may not be as appropriate for the western

Himalayan zone as it is for the rest of the Indian basins. Presently the Hydrological Year

starts during the late snow and mid glacial melt season where flows are not at their yearly

minimum. This may introduce some systematic error or bias especially for analysis of 90%

dependable year when a single year is used.

To realistically assess the run-of-the-river energy output, the power projects immediately

upstream should be considered as a minimum. When assessing the energy output, the

timing of available water inflowing from these upstream schemes may dictate the timing of

the energy output of the downstream site. Additionally, a cascade of run-of-the-river schemes

could be optimised for total energy output if they are analysed together rather than in

isolation and ideally a basin-wide approach to energy yield is preferable. The current practice

of using 3 values per month or even daily flow data is not really adequate when considering

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run-of-the-river projects, as the diurnal generation pattern can not be adequately assessed or

simulated with such data.

The design of hydropower projects fails to consider optimisation of energy output due to

firming of seasonal river flows from optimised release from a major upstream storage eg.

Khab. Modelling has shown that if such a seasonal storage were considered, then the basin-

wide energy and also the energy output of individual power projects increases if releases

from the upstream storage are seasonally regulated.

A basin wide approach to yield assessment would be of advantage to all proponents.

Recommendations:

Central Electricity Authority in conjunction with the Central Water Commission should

consider the adoption of the following recommendations in order of priority.

1. Consider mechanism for the collation, management of an accessible, uniform data

set for rainfall and streamflow to all proponents so that at least all available data is

considered when making at-site calculations and transposition and assessment of

maximum storms for a region.

2. Consider adoption, dissemination and requirement to use more appropriate and

standardised yield calculation methods. Training modules for proponents and

consultants could also be developed and implemented through workshops and/or

guidelines.

3. Develop and disseminate more suitable procedures to replace the use of the 90%

dependable year which is inadequate in assessing real power station output. Training

modules for proponents and consultants could also be developed and implemented

through workshops and/or guidelines.

4. Consider a more appropriate Hydrological Year boundary (such as January or

February) for regions where snow and glacier melt is significant.

5. Consider adopting guidelines requiring that the best available data be used in yield

and flood analyses and discouraging the use of 3 values per month aggregated data.

2.2 Production Optimisation and Interface of Cascade Schemes

Current practice for energy production optimisation appears to be that projects are optimised

on an individual basis, without regard to other projects in the cascade or indeed entire basin.

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Some mathematical modelling in the Alaknanda basin was carried out to show potential

repercussions of this practice. Our modelling studies indicated that optimisation of the

operation of the Alaknanda and Vishnuprayag plants (treated as a cascade) over the

currently planned design / operation (where the projects are regarded as independent)

results in an increase in energy output of 230 GWh pa valued at INR 58 crore pa.

In the Satluj River basin the GOHP has accepted a proposal, and is currently negotiating with

developer Brakel, for the allotment of a single project to replace the advertised 480 MW

Jangi Topan and 480 MW Thopan Powari. This is an example of a developer finding

advantage in optimising two projects into one, effectively a mini-example of cascade

optimisation.

For the Alaknanda River basin a request for tenders recently came out for the Pindar River, a

tributary of the Alaknanda, to undertake a cascade scheme optimisation study, followed on

by the PFRs and DPRs for the individual projects. The UJVNL Master Plan indicates a total

installed capacity of 240 MW for this stretch of river. However, some recent optimisation

undertaken by IL&FS and the Government of Uttarakhand has lead to a revised cascade

arrangement with total installed capacity 306 MW. The consultancy will further optimise the

stretch of river, including a cost-benefit analysis which will consider the environmental and

social issues as well least cost energy.

Further positive moves in this area are expected with IL&FS soon to call for tenders for

optimisation of the upstream stretch of the Pindar, and also there is the possibility of a joint

venture with the GOU for similar optimisation of cascades of hydropower projects in

Uttarakhand.

There does not seem to be a basin-wide System Model for either the Satluj or Alaknanda

basins. Such a model would comprise a hydrological mathematical simulation of the various

major rivers and tributaries along with the expected individual power schemes coded as

operational rules including expected hourly operation and storage/diversion characteristics.

Input would be a standardised inflow sequence for the major tributaries over a set period.

In order to examine the hydrological issues in an objective manner, an operational model of

the Satluj cascade of power station and storages was set up to demonstrate what might be

achieved should a basin-wide modelling approach be adopted in order to optimise the

cascade. This model was able to examine the likely effects of how individual

generators/reservoirs would be assessed for output, both individually and in combination with

other generators in the cascade. The modelling is described in detail in the Modelling Report

which was an interim output of this Study. .

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The modelling demonstrated that the overall energy output from a cascade of generators can

be increased by optimising the scheduling of successive generators as the peak river flows

progress downstream. The results give enough confidence of the potential that can be

achieved through basin wide hydrological models and signal a clear benefit that could be

achieved from a more comprehensive study to determine the optimum generation schedule

for the basins as a whole. Such a model would require inputs from the available stream flow,

rainfall and other climatological time-series records, only some of which were made available

for the current study. The model would need to be less simplistic and to simulate in more

detail the operation of the individual power stations in order to optimise the individual and

basin power production.

Developing such a model would be a fundamental step in moving toward a river basin

planning approach, regardless of the formal mechanism or agency used to implement river

basin planning principles. It might be appropriate for a central body to develop and own such

a whole-of-basin model and provide individual developers access to simulation results. In this

way, the model integrity would be secure and centrally updated with any proposed additional

developments that may impact on other developers. The model might be used to assess best

operating procedures for individual generators, including allowance for minimum

environmental flows, such that the maximum energy would be extracted from the basin. If

and when a peak tariff is adopted, it can be argued that individual generators may have to be

compensated for generating at non-peak load (peak price times) for the overall benefit of

basin output.

Recommendations:

1. Consideration should be given by the state governments for the development of basin

wide hydrological simulation models with the output available to all developers. Such

a model would allow sensible options planning at a broad scale and allow the

governing authority to understand how changes to individual projects by proponents

might affect all other projects proposed within the system.

2. State governments should consider the commissioning of comprehensive studies to

determine the optimum generation schedule for the basins as a whole through the

development of basin-wide hydrological models which could be used to simulate the

network of dams, diversions and generators.

3. State governments could consider a framework for possible compensation for

developers for any individual loss incurred as part of achieving wider river basin

planning outcomes.

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2.3 Sedimentation and Water Quality

Sedimentation issues have been prominent in the subject basins, with the Spiti River having

a particularly high silt load. The Nathpa Jhakri plant has faced frequent shut downs due to

very high concentrations of silt during the monsoons. On the Alaknanda, only two months

after the Vishnu Prayag project started commercial production two of the four turbines had to

be taken out of service for repair following severe damage from the silt laden water.

The number of upcoming projects in the Satluj and Alaknanda is likely to result in more

sediment entering the rivers through soil erosion, construction spoils, etc. The proposed

Jangi Thopan, Thopan Powari, Tidong I, Tidong II and Shongtong Karcham projects are

planned in landslide prone areas which may exacerbate the silt problem. There is, therefore,

an urgent need to improve the sediment handling arrangements in order to avoid seriously

undermining the value of projects.

There are a number of key impacts of silt load on hydropower projects, which are

summarized below:

� Loss of storage � if the storage is lost with time due to siltation, then the benefits of

the storage including daily and seasonal regulation of the flow and the flexibility of

operation (eg. peaking power) will be lost. The following section discusses the

benefits of an upstream storage trapping much of the silt to increase the reservoir life

of those downstream projects with storage.

� Erosion / Pitting of turbine runners � high silt load damages turbine runners with

pitting and erosion, resulting in reduced efficiency and a reduced life. Current practice

is to incorporate desanders which remove silt particles of size greater than 0.2mm,

and in times of high flow to close down the power station when the silt load exceeds

4000 ppm. The cost of construction and operation of the desanders, and the cost of

lost energy production when the plants are shut down during periods of high silt load,

add considerable costs to the projects which affect their financial viability. This

problem could be reduced by having an upstream storage to trap silt (discussed in

following section), and by having more efficient desander designs. Costs could be

reduced by having the de-silted water from one project being directly fed to the

downstream project, as is planned for the Raipur project downstream of Nathpa

Jhakri.

� If silt is taken from the river either by being retained in a storage, or by being

completely removed from the river system (as has been proposed by some

developers) then the reduced sediment loads may lead to erosion of the existing

10

channel sediments and destabilization of riparian vegetation, impacting on water

quality. Downstream users, including farmers who rely on sediments for terrace

farming, would also be impacted.

Recommendations:

1. In the following section there is a recommendation for basin-wide consideration of an

upstream storage in respect of flow regulation, and increased energy output from a

cascade of smaller power plants. Such a storage would also benefit downstream

projects in terms of extending reservoir life and reducing downtime due to high silt load.

2. Conduct a cost-benefit analysis of removal of sediment of different minimum particle

size than the currently adopted 0.2mm.

3. Consider different desilting basin configurations such as V-shaped desanders as used

internationally, or proprietary sediment flushing arrangements.

4. Consider the engineering option of having water discharged from one power station

directly fed to the intake of the downstream station, avoiding the need for another

diversion structure and desander.

2.4 Storage and Regulation of Flow

The results of the hydrological model studies suggest that the output from a cascade of

storages and generator could be improved if a large enough seasonal storage is

incorporated high up in the cascade of dams. This storage needs to be sufficiently large in

order to allow proper regulation otherwise the effect might be to reduce overall output due to

peaking of flows. Regulation provided by a storage would not only result in more energy from

the cascade, but would also result in less expensive projects because of lesser number of

turbines and reduced installed capacity. There would be reduced environmental / social

impacts because of the smaller footprint of the downstream projects.

The Preliminary Feasibility Report for the Khab Dam Project carried out by SJVNL in 2005

estimates a project cost of INR 14,412 crore. In recognition of the potential numerous

benefits of the project, the PFR apportions the cost of the project as given in the third column

of Table 2.1. On this basis the various benefits of the project considerably outweigh the

costs.

11

Table 2.1 - Costs and Benefits of Khab Storage

Description Estimated Benefits

INR crore

Note 1

Cost Allocation INR crore

Note 2

Notes

Energy generation 5,700 5,700

Flood control 2,064 1371 Note 3

Silt control 8,857 5,886 Note 4

Increase in life of Kol Dam

849 564 Note 5

Increase in generation at downstream plants due to Khab regulation

1,341 891

TOTAL 18,811 14,412

Note 1 The second column of Table 2.1 gives the estimated benefits determined in the

PFR. The PFR does not give a specific value to the benefit from energy generation of 3,522

GWh in a 90% dependable year, so the benefit is taken to be the PFR cost allocation of INR

5,700 crore. This assumption is justified given that 40 years of energy production at a

reasonable tariff of INR 2.41/kWh (with 5% annual escalation) has a net present value of INR

5,700 crore (10% discount rate).

Note 2 The third column of Table 2.1 gives the PFR cost allocations against each benefit

of the project. It can be seen that only two-thirds of the estimated benefit in each category

other than energy generation has been allocated as a cost to the project. If the entire

estimated benefit was transposed as a cost to the project, then the cost of energy generated

reduces to only INR 1,300 crore � this would result in an extremely low tariff.

Note 3 The PFR suggests an additional indirect socio-economic benefit of INR 1,000 crore

for the reduction in flood damage to property, infrastructure, forests, etc. If some of this INR

1000 crore were to be allocated as a cost to the project, then this would again reduce the

cost of electricity generation.

Note 4 Storage of silt in Khab reservoir would result in less down time at the downstream

projects which are shut down during times of excessive silt load in the water. The PFR

suggests a benefit to each downstream plant in proportion to the installed capacity, which

leads to a benefit at Nathpa Jhakri of the order of INR 2,500 crore. The modelling reported in

12

the following section of this current report is based on actual data from Nathpa Jhakri and

gives a benefit of INR 5,500 crore at Nathpa Jhakri. This suggests an additional INR 3,000

crore could be allocated to silt control, with an associated decrease in cost of electricity

generation. Over and above this, there would be the benefit of savings on account of

reduced erosion of turbine runners and other underwater hydro-mechanical parts in the

downstream projects because of reduced sediment.

Note 5 The PFR estimates the benefit of increased reservoir life at Kol Dam, and although

the PFR recognises a similar benefit at Bhakra Dam, it is not quantified. This Study�s

Modelling Report gives a benefit from Khab dam storage of INR 1,000 crore for the delay in

Bhakra reservoir being completely silted and only operating as run-of-river. Again, if the

benefit of this cost saving was allocated to the Khab project it would further reduce the cost

of electricity generation.

Thus, on the basis of the PFR, the Khab project appears to be economically viable provided

that the downstream projects are willing to pay for the benefits that accrue from the sediment

trapping, flow regulation, and flood control provided by the large upstream storage. More

study is required to be convinced that a Khab storage is cost-effective, and this must be done

in conjunction with a thorough study of the environmental / social effects, and the

practicalities of cost sharing via the benefits described in Table 2.1. At the 1st November

Workshop, a representative from SJVNL said that at the time of the Khab PFR, the only

known downstream developer was NTPC (Kol Dam), and NTPC were quite receptive to the

concept of paying for benefits derived from the Khab project.

A river basin approach to planning hydropower development would enable such an important

study as an upstream storage to be carried out at a sufficiently early stage so that a decision

can be made, and downstream projects could then be planned and designed accordingly.

Recommendations:

1. In overall basin planning, consideration should be given to the benefits of an

upstream storage, weighed up against environmental / social negative impacts if any.

In the particular case of the Satluj basin, it is acknowledged that much study has

been done regarding the proposed Khab storage project, with the PFR indicating

techno-economic viability. Proposals for a full DPR study have been called by the

developer but it is understood that this process is on hold because of concerns by

the local people, and the nationally strategic location of such a large dam. There is a

strong case for such a storage given the benefits of water storage, flow regulation,

silt storage, and flood attenuation. Climate change and the need for a secure water

13

supply can only strengthen this case. It is suggested that the GOHP take a river

basin wide view of this project, involving all stakeholders including of course the

downstream project developers and the local people. The benefits of such a storage

are great, and with appropriate benefit sharing there may be a way forward in which

all stakeholders benefit and are comfortable with a storage project.

2.5 Environmental (Sustainability) Flows

The minimum flow requirements in the Satluj and Alaknanda basins have not been

developed with an understanding of the ecology of the river basins, the �carrying capacity� of

the rivers, or social and economic objectives for the downstream environment. Whilst the

establishment of appropriate sustainability flows continues to be a challenge everywhere,

there is potential to improve its calculation and application in India. There is a risk to

developers and/or to ecosystems and society if flows are set too high or low. It could be said

that in the absence of detailed studies to establish the river systems requirements, that a

base minimum flow at least provides some level of access to water by users immediately

downstream and some degree of ecological function. The debate then comes to defining the

goal that society wishes to achieve from setting a flow, and then setting the actual

sustainability flow, which could vary over the length of the river, depending on the agreed

objectives. For example, given the high cultural importance of the Alaknanda as a tributary of

the Ganga and a heavily travelled pilgrimage route, it could be argued that a greater

sustainability flow is required.

The Government of Himachal Pradesh is the only state to have a legal requirement for water

release to the river being defined as being the �threshold value of not less than 15% of the

minimum flow observed in the lean season�. The interpretation of this requirement has been

applied variously from the minimum flow at one single point in time in any one lean season

(15 % of an absolute minimum flow ever recorded) to an average flow over the lean season.

The varying interpretation of the required sustainability flow, and the difficulty in monitoring

compliance, mean that there is a real possibility of unnecessarily generating less power than

possible with an appropriate sustainability flow.

It is understood that the practice in Uttarakhand is a sustainability flow of 10% of the lean

season flow. In the Alaknanda basin, particularly in the River Dhauliganga, it has been

observed that the river flows in the month of December and January are the lowest. For the

Tamak-Lata project, the sustainability flow was taken as 10% of the average flow in the

months of December and January. Other projects in Himachal Pradesh or Uttarakhand could

meet their obligations by taking a much lower flow based on the absolute minimum flow

recorded. In the Spiti River, it can be expected that there will be a complete drying up of river

14

downstream of the projects during the lean season, signalling the need for a higher

importance of establishing an appropriate flow.

International good practice points to the consideration of controlled water releases to support

ecological and other objectives of the river. Setting effective sustainability flows requires a

sound understanding of ecosystem function and other values. These should be derived

through a consultative process.

Sustainability flows can be based on maintenance of a minimum flow in the river, constraints

on draw-down rates, and periodic flushing flows. Agreed sustainability flow regimes may

include some or all of these considerations, and may be specified for year-round or by

season.

By utilizing a good process of establishing sustainability flow objectives, it may be possible to

find ways to address these objectives without significant loss of generating potential.

Downstream regulating ponds and other engineering solutions may provide cost-effective

alternatives to flow releases directly from power stations, and construction of smaller off-

stream storages can be considered to deliver flows to address particular local issues.

There is an opportunity to develop a good database and clarify objectives as part of basin-

wide development in the Satluj, Alaknanda and other basins where hydropower projects are

planned. This would involve data collection and analysis on key variables which would then

be linked to the objectives set for sustainability flows.

A whole of basin approach in India, will allow more cost-effective resource allocation in

establishing downstream flow objectives, better prioritisation of high benefit areas for

releases, better identification of low value areas where releases might not be required, and

reduced overall losses due to coordination of releases in the basin.

Recommendations:

1. MoEF and the state governments to consider an international forum on sustainability

flows and expert committee to discuss sustainability flow methods and determinations

and, in particular, how it can be best determined for a river basin. This could be

incorporated into hydropower policies, Departmental notifications, and

aforementioned methods and data sharing.

2. GoHP and GoU should develop plans to collect relevant data and identify objectives

across the two basins and then integrate these into EIA requirements.

3. Consideration should be given to reassessing the 10/15% rules following collation,

15

collection, and analysis of data leading to a program to proactively establish the

ecological, social and economic values across the basins and, in particular, of the key

rivers from which hydro-electric generation is proposed in order to set appropriate

objectives for sustainability flows. Appropriate downstream flows and/or other

strategies to meet the objectives can then be developed in consultation with

proponents and informed by findings from the international expert forum. Findings

and approaches can be incorporated across other states.

4. GoHP and GoU should also consider potential measures to address risk/uncertainty

issues for developers resulting from future adaptive management requirements.

2.6 Flood Risk Assessment

Our research suggests that methods used in the context of preparing the project feasibility

studies for extreme flood estimation in the basins are not always consistent with the CWC

guidelines. The guidelines suggest appropriate methods without actually being prescriptive

and consultants generally try to adopt the simplest approach, without exploring more

appropriate methods for flood estimation depending on the circumstances.

With the amount of snow and glacier melt runoff contributing to baseflow and the potential for

increased flood runoff from extreme monsoon season rain events falling on snow covered

area, it would be prudent for proponents to undertake a basin approach to flood estimation

using the deterministic rainfall approach plus unit hydrograph or hydrological modelled flood

runoff.

Consideration of flood potential should occur early in the planning process for potential

project locations. Many of the Satluj and Alaknanda tributaries have a history of cloud-burst

and flash floods, the operating Baspa II (300MW) plant being located in one such valley. The

Baspa River previously flowed into a lake that covered part of the valley, the river entering

the lake near Rakcham and exiting from a very narrow opening a few kilometres down the

valley. The Baspa has a history of transporting avalanche-landslide induced debris during

very high rainfall conditions. Such issues of flood and landslide conditions should be included

in an assessment to determine the level of risk and its effect on viability of a project in those

locations and/or to determine the potential to mitigate.

As discussed in the Issues Paper, it appears that no proponent has considered a combined

probability of reservoir failure in a cascade of dams within a river basin. In many cases a

combined failure approach is not warranted, as the reservoirs are small but for some of the

intermediate or large dams, combined probability of failure should at least be considered.

16

The key advantage of flood risk assessment is in providing an accurate picture of risks upon

which to base mitigation measures and emergency planning. An investment in a basin wide

assessment could be shared by governments and developers and flood prevention

measures can be developed in high risk areas appropriate to the conditions, thereby saving

social and economic costs associated with flood damage.

Recommendations:

1. CWC should consider adopting more rigorous standards for the estimation of flood

design. A basin approach to flood estimation using the deterministic rainfall approach

plus unit hydrograph or hydrological modelled flood runoff would be most appropriate.

2. CEA in conjunction with CWC should consider a mechanism to formally require

developers to include a combined probability approach when considering

developments within a river cascade. It could be mandatory for developers to show

that a combined probability approach is not required or otherwise undertake such an

analysis.

3. CEA in conjunction with CWC should consider mechanism to formally require

developers to calculate the incremental consequences of structural failure on other

downstream structures and communities.

4. A basin-wide flood forecasting and warning system should be implemented such that

all downstream plants, local towns and villages can receive adequate and appropriate

warning, including upstream dam break. Such a system is beyond any one individual

developer and should be coordinated by both State and central agencies. The

running of such a system might best be undertaken by Central Water Commission

given their current responsibility and ability to collect real-time hydrometric data from

remote river and precipitation sites. Such a system would require extensive upgrading

to remote data gathering site, telemetry communications and central database and

processing. Forecasts and warnings derived through the system could be

disseminated directly through responsible officers for each developer along the river

with appropriate mechanisms in place between individual reservoir operators and

local and State emergency response authorities for the appropriate and timely

warning of flood situation with action according to flood severity. It should be noted

that for the Satluj, the proposed Real-time Decision Support System for Bhakra Beas

Management Board would provide all of the required inputs and forecast modelling to

such a flood warning system. In this case the direct outputs from the system will be

used by BBMB for flood warning and management of floods associated with and

17

down stream of their reservoirs, but the system could also be used (with additional

modification) by other operators as input to provide local forecast and warning along

the entire river length.

2.7 Multiple Development of Associated Infrastructure

Many issues have been identified in the implementation / construction phase of many

projects in the river basin. The sheer movement of people, materials and equipment into the

remote mountainous environment for the construction of the planned projects will create

major problems for local people and communities, the developers, contractors and workers.

The need to ensure the safety and well-being of the large numbers of pilgrims and tourists in

many of the areas slated for hydropower development is a particular concern. The pressure

on these areas will only increase as more projects progress toward construction.

A coordinated approach to the implementation phase should significantly improve this

situation to the benefit of all stakeholders. For example, a coordinated approach to the

construction activity could include scheduling of projects, shared investment to improve road

standards, and traffic management.

The advantages of planning and implementing these works in an integrated manner are that

the integrated approach:

is the most cost effective,

has the potential to reduce impacts on the environment and communities both during

construction and the longer term, and

has the potential to deliver better end results by for example having community input

into what they would like to have by way of infrastructure.

The construction of hydropower projects requires good road infrastructure for the transport of

construction equipment and materials, heavy steelwork in the form of gates and valves, and

plant machinery. Simultaneous construction of several hydropower projects in a particular

area may place a heavy requirement on road infrastructure already being used by the local

population and travellers. Road upgrades will be required, and staggering of construction

schedules may alleviate peak traffic and hence avoid or minimise road upgrade

requirements.

18

It would be of great benefit to have a forum that brings the developers together to discuss

required infrastructure and reach consensus. This forum could consider the overall benefits

of particular projects deferring their construction schedules. For example the developer of an

upstream project in a cascade could defer construction so that the downstream developer

could construct an access road and mains for construction power. The upstream developer

could then extend the access road and mains to his project. Overall savings in access road

construction, and avoidance of using diesel generating sets in the likely case of insufficient

mains construction power for parallel construction activities, would benefit both developers

who could share the benefits.

At present the planning, coordination, development and undertaking of the transmission of

electricity through the inter-state system is being undertaken by PowerGrid whereas for the

intra-state system the responsibility lies with the State Transmission Utility.

PowerGrid�s Master Plan is prepared primarily on the project basis and covers interstate

transmission. This approach doesn�t necessarily account for the most optimal utilization of

transmission capability because not all future planned projects are considered. In order to

plan, design, implement and maintain a comprehensive transmission evacuation system, a

river basin approach is more prudent because:

It will entail a comprehensive approach for all the projects in the basin whether

captive, merchant, IPP etc. Moreover, the main emphasis in both the Satluj and

Alaknanda basins is on sales of power outside of the State and the projects

considered are mostly greater than 100 MW. Hence, transmission planning should

focus on the inter-state transmission system, for which close coordination between

the State and Central authorities is required.

The river basin modelling will be optimizing the energy output by virtue of cascade

operation for most optimal harnessing of the available energy. The same approach

would also lead to optimal planning and utilization of the power evacuation system.

The development of a consolidated evacuation system can be undertaken in stages,

in conjunction with the development of different schemes, with suitable methods of

cost and profit sharing for the common infrastructure for cost effective development.

It would account for the secondary energy forecasting and planning/utilization of the

transmission system for the same, whereas in present methodology the increase in

secondary energy may lead to transmission congestion.

It would cater to inter-state and intra-state interfacing connection requirements due to

consolidated planning of all the hydro power schemes.

According to the most recent data, the States of Himachal Pradesh and Uttarakhand

19

(although able to meet their peak power demand) are unable to meet their total

energy requirements, the energy deficit for April-August 2007 being 0.8 % and 1.2 %

respectively. The consolidated transmission planning will automatically cater to inter-

state (when there is energy surplus) and intra-state (when there is energy deficit)

interfacing/inter connection requirements by accounting for small hydro, seasonal as

well as diurnal demand & generation pattern, transmission losses etc.

Recommendations:

1. Consider establishing a forum in which all stakeholders can consider the shared

infrastructure required by the developers, with a view to minimising overall cost and

adverse environmental / social impact.

2. State governments and State transmission utilities should coordinate transmission

investment plans with PowerGrid in keeping with the development plans for each

basin to enable optimal planning and execution of transmission for power evacuation.

2.8 Preparation of adequate and strategic Environment and Social Impact Assessments and Mitigation Plans

The current situation of uncertainty surrounding the planned major development of

hydropower in the Indian Himalayan region is, in itself, creating social and economic impacts.

People in the region do not have a clear understanding of the extent of the development and

the environmental and social impacts on particular areas. This makes investment in

infrastructure and economic activity difficult and does not allow for preparation to take

advantage of the economic and social development opportunities and benefits.

A river basin approach to environmental and social assessment would bring benefits at the

planning stage for all parties. For developers it could bring:

more certainty of development requirements and acceptance.

early focus on what is achievable, rather than wasting time on non-supported options.

lower costs � simpler consultation, more baseline data, less time and expense in

completing environmental and social impact assessments.

A comprehensive environmental impact assessments (EIA) and social impact assessment

(SIA) would include analysis of current data, potential impacts and benefits, consideration of

alternatives and of cumulative effects, and present avoidance, mitigation and/or

20

compensatory activities that can be implemented to minimise the overall impacts. For SIAs,

this would involve looking at the wider socio-economic impacts (positive and negative) with a

comprehensive approach to understanding the social and economic uses of the river and

surrounds and how these might be affected by the project. Further, it would involve a wider

definition of who is �project affected� to ensure consideration (and potentially compensation)

is given to those whose livelihoods and well-being is impacted. For EIAs, there is a particular

opportunity to improve the downstream and cumulative impact assessment to ensure the full

effect of the project is understood.

A number of NGOs supported the concept of river basin planning because of the opportunity

it provides to look strategically at the natural, social and cultural assets or values in a basin

and to better plan to minimise impacts to vulnerable systems. It was also seen as an

important step to increase objectivity in assessments which would begin with a basin wide

assessment that is independent from any one project developer.

The river basin planning approach advocates Strategic Planning in which the selection of

projects, sites and project alternatives gives due weighting to environmental and social

aspects in conjunction with economic and technical requirements through Strategic

environmental and social Assessment. The overall impacts of multiple developments are

identified through a process of Cumulative Impact Assessment.

These processes allow for the selection of the optimum combination of projects / sites which

result in the least impact for most benefits. It also provides for identifying the best

combination of a range of other benefits through multi-purpose projects. Planning for other

uses and additional benefits on river basin level can include specific environmental benefits

such as conservation and biodiversity, reservation of high value tributaries as undeveloped

streams and catchments and requirements for environmental flows or release of water to

meet specific environmental needs, community uses, water access and catchment area

treatment including sediment control and afforestation.

This is particularly important for the Alaknanda which has high cultural and ecological values

and is relatively undeveloped and, therefore, has a greater opportunity for integrated

consideration of environmental and social issues. Proposed projects in the Alaknanda Basin

include Tapovan Vishnugad (520MW) which is under construction, Malari Jelam (55MW),

Jelam Tamak (60MW), Tamak Lata (280MW), Lata Tapovan (310MW) and Alaknanda

(240MW) which are under investigation, and Deodi (60MW), Rishi Ganga I (70 MW) and

Rishi-Ganga II (35MW) which have been identified for development. All of these projects fall

within the Nanda Devi Bioshpere Reserve and the latter three are located within the Nanda

Devi National Park (NP) or core zone (see Figure A1.7 in Appendix 1). The Biosphere is

21

considered of extreme environmental significance and the Nanda Devi NP is a designated

World Heritage Area listed for its exceptional natural beauty as one of the most spectacular

wildernesses in the Himalaya, containing a number of endangered species of universal

scientific or conservation value. The area has been managed under strict requirements for 20

years and only 100 or so people are reported to have entered the core zone since its World

Heritage listing in 1988. Given there are a number of projects proposed within this

ecologically important area, a thorough study of the cumulative impact should form part of

the final plan of any projects to be allotted. The likely opposition and increased clearance

requirements for projects in this area should also be considered.

In the Satluj Basin, the Kashang Stage I (66MW), Kashang II (60MW) and Kashang III

(132MW) are proposed in the vicinity of Lipa Asrang High Altitude Wildlife Sanctuary (WLS).

Similarly Sorang Kut is proposed in the Rupi Bhaba WLS (see Figure A1.4 in Appendix 1). In

accordance with the Wildlife Protection Act 1972, no development activity is allowed within

the sanctuary without the permission of Supreme Court of India. Whilst there is precedence

for clearances within Wildlife Sanctuaries, it may be prudent for GOHP to undertake a

thorough assessment of impacts to ensure impacts are understood and minimised. Full

information on the impacts, if any, and how they will be addressed, may improve acceptance

of the projects and improve decision timeframes for clearance from the Ministry.

According to the International Association for Impact Assessment, a successful strategic

assessment is:

Integrated

Focused

Sustainability-led

Accountable

Participative

Iterative

An important benefit of such an approach is in promoting the consistent and transparent

allocation of projects whereby all stakeholders can see that the process is fair and open.

Such an approach would help to build social acceptance, by demonstrating transparency in

the planning process, fostering public participation, and allowing companies to display their

corporate responsibility. It would also provide for strategic environmental assessments that

can inform project specific EIAs, thereby enabling early consideration of environmental

22

issues in the investigation stage and improving the quality of such documents that, ultimately,

will reduce project delays in receiving environmental clearance (Singal, 2006).

This reduces the political risk and risk of public protest; reduces delays and increase as

project stoppers and cost / schedule risks identified early; allows for clearly identified and

enforceable development rules and no-development areas; facilitates better planning for

inter-dependent projects; and provides a consistent assessment by proponents and

regulators.

For example, the Rampur project on the Satluj River involved a lengthy process for

environmental clearance as well as lengthy timeframes for the approval to convert forestry

land and other associated clearances, which are considered to have significant effect on

overall project viability estimates (Sharma et. al., 2006). Singal (2006) argues that early and

thorough environmental assessments can reduce this timeframe and improve acceptability of

the project.

Thorough strategic, cumulative assessments will provide a more robust baseline and better

understanding of issues to enable future evaluation of predicted impacts. Verification of

potential impacts once a project is operating has not occurred in India and it is considered by

some to be a major barrier to understanding and appropriately assessing potential impacts of

new projects (Singh and Banerji 2002).

It could be said that many of these benefits could be gained in the planning of individual

projects through the application of good practice. However, a river basin approach to

planning could provide a framework for coordinated data collection and analysis, strategic

site assessments and would promote good practice in the areas of transparency, public

accountability and consistent enforcement of the rules, thereby improving environmental and

social protection and development outcomes.

Strategic planning and environmental assessment requires adequate environmental

monitoring and baseline information which is best managed by coordination across the river

basin level. Without this, it is difficult for project developers and approval agencies to

adequately understand environmental values and assess environmental impacts.

In some cases the data does not yet exist and data collection programs will form the first

steps of river basin wide assessments. In other cases, there are data held by numerous

bodies that will be important in modelling and assessing project potential and likely impacts

associated with developing the projects.

Consultation with NGOs and scientific institutes highlighted that the availability of data that

23

are consistent and of high quality is highly problematic in undertaking effective assessments,

including environmental, climatic, hydrological, and social data. Project proponents, too, can

benefit from transparent access to complete data sets to facilitate effective planning.

The Study Team has had difficulty in accessing relevant data for this Study. There are

various reasons such as the numerous stakeholders gathering and storing data, quality of

data records and easy retrieval, perceived security risk related to the data, bureaucracy in

having data released, and commercial value of the data. Stakeholder consultation revealed a

widely held belief that this problem of access to data could be addressed by gathering,

storing and managing data at a river basin level.

Recommendations:

1) State governments to commission a strategic environmental and social assessment

for the basins, consolidating current information and clearly identifying high value

stretches of river, landscapes, and habitats as well as areas with less critical habitat

and species. This is particularly important for the Alaknanda basin, considering its

relatively undeveloped state and could guide the process of site selection and could

consider designating sections of rivers or entire rivers as reserved for conservation,

tourism or other low-impact uses.

2) State governments to consider forming a Taskforce of experts to determine data

requirements and agree appropriate methods for river basin resource and impact

assessments.

3) State governments to consider mechanism (technical and process) to provide for

shared data between agencies, developers, and community organizations, perhaps

identifying or creating a single agency to have responsibility.

4) MoEF to consider preparation of template/guidelines that clearly outline international

good practice for EIAs and SIAs including guidelines for cumulative assessment and

participatory involvement.

5) State governments to consider establishing a forum for Panchayat representatives to

provide an avenue for accurate information about social and economic resource use

and activity in the vicinity of proposed projects and to provide input to developers and

agencies on socio-economic outcomes.

6) MoEF and/or State governments to consider a mechanism for independent review of

EIAs/SIAs against the guidelines developed which might include a fee from

24

developers that is directed to a targeted Fund for this purpose.

7) Develop a Program for training of project managers and consultants in preparing

strategic basin-wide EIAs and SIAs. This could be coordinated by the MoEF and/or

the National Registration Board for Personnel and Training (NRBT) and build on

efforts to date focused on improving the quality of EIAs through

registration/certification.

2.9 Implementation of Catchment Treatment Plans and Compensatory Forestry

Environmental clearance conditions generally include development and implementation of

Catchment Area Treatment (CAT) Plans. Where these are undertaken well with resulting

regeneration of natural forests and other habitats, there can be significant benefits to the

environment as well as to hydropower projects, as the sediment load in the river is reduced.

Consultation with NGOs and scientific organisations has indicated that the success of such

plans is variable in the basins and India generally, potentially due a number of reasons:

The involvement of several agencies which can confuse responsibility.

The developer is not in complete control of implementing mitigation and offset

activities committed to in the DPR.

State Forest Departments responsible for implementing CAT Plans do not have clear

accountability to specifically allocate the funds and resources for implementing the

plans in the project area.

Implementing agencies are under resourced and can have difficulty in implementing

the activities amongst a range of other responsibilities.

Given that CAT Plans are required for all projects, undertaking planning for this on a basin

level should afford more efficient planning and implementation that could be shared amongst

relevant developers. For Nathpa Jhakri, SJVN allocated 29.57 crore for catchment area

treatment (Sharma et al. 2006a). With CAT being a key mitigation/restoration measure

reducing overall impact of the projects and sums of around 2% of project costs being

directed to it, CAT plans represent a major area for potential collaboration by operators.

Steps toward this are already in place, with CAT costs in the Satluj expected to be shared by

all projects (Sharma et al., 2006a). However, the implementation is not in the control of the

project developers and it is not approached as a basin-wide activity. Taking a basin wide

25

approach to assessments and planning for CAT, as well as sharing the costs, can only

improve the return on investment in terms of outcomes.

Ensuring that payments for CAT and compensatory afforestation are directed at the right

activities in the right areas is an important aspect to successfully meeting the environmental

objectives of the governments� hydropower policies and in ensuring the best environmental

outcomes for the project. As part of the conflict resolution for the Phalenda project, the

Divisional Commissioner of Garhwal ruled that the utilisation of money provided against

forest compensation should be made through Panchayats in the affected villages. Although

this project is not in the subject basins, it illustrates the possibility for a more targeted

approach to the direction of compensatory afforestation payments.

Recommendations:

1. Consider mechanism similar to Phalenda outcome to direct compensatory

afforestation fees from project developers into a specific fund for allocation for

activities within the relevant basin or sub-basin, potentially via Panchayats.

2. Governments should consider mechanism for defining legal responsibility of

developers to implement CAT Plans and include mandatory reporting of progress to

Government.

3. MoEF and State Forest Departments should consider a mechanism for independent

review of progress and compliance of CAT, potentially by relevant agency branch or

via a panel of expert providers (institutes or consultants).

4. Project developers should consider involvement of local communities or

environmentally-oriented NGOs in implementation, and governments or dedicated

river basin authority could consider local involvement in monitoring of implementation

and in the mechanism/process for reporting.

2.10 Development and Implementation of Environmental and Social Management Plan Activities

A common theme from NGOs and scientific institutions has been that there is often a gap

between plans and their implementation. Developers currently commit around 4-5% of

project costs toward management plans, catchment area treatment and compensatory

afforestation (not including costs of developing EIAs/SIAs), much of which is provided to

government agencies for implementation. With resources and personnel limited, the ability of

the government departments to effectively implement and/or monitor compliance against the

26

plans will become increasingly difficult as the hydropower development program progresses.

Again, transparency of information and participation of local communities can add more

value than might be expected by a project developer and scrutiny (whether from civil society

or from government departments) will ultimately improve the effectiveness of financial

contributions for this purpose and, therefore, environmental and social outcomes of the

projects. Successful environment and social outcomes will become increasingly more

important to corporate reputation and, therefore, timely project implementation of current and

future projects.

Governments may also have an opportunity to place stricter requirements on developers

through the contracts for allotment. These could specify and strengthen the requirements to

ensure environmental and social benefits.

Recommendations:

1. Consider strengthening legal mechanism to clearly assign responsibility for

implementation of plans to the project developer to ensure plans are implemented

(refer also recommendations under Implementation of Catchment Treatment Plans &

Compensatory Forestry).

2. Consider how state government departments can be supported with the growing task

of compliance monitoring, whether through establishing a separate body for the

purpose (river basin authority or otherwise) providing additional budgets and/or

personnel for the specific purpose, or allocating funds for outsourcing enforcement or

compliance auditing to independent institutions or consultants;

3. State governments should consider strengthening environment and social

requirements of the tendering process and include them in the allotment contracts

with the developer. Specifically, the MOUs signed by the developers following project

allotment by the state government could be significantly clearer regarding the

expected standard for environmental and social outcomes..

4. MoEF should consider a mechanism for independent review of environmental

management plans and local area development activities against the clearance

conditions, which could include a fee from developers that is directed to a targeted

Fund for this purpose and could include a panel of experts from institutes /

consultants.

27

2.11 Benefit Sharing

Consultation with governments, NGOs and scientific institutes highlighted the desire for

greater consideration of benefit sharing for the communities when planning and

implementing Indian hydropower projects. The primary issue relates to a desire to move

beyond the singular focus of compensation of directly affected people (which is often

perceived as inadequate) to embrace the concept of benefit sharing with a more widely

defined group of project-affected communities. The possibilities for and potential success of,

benefit sharing activities or mechanisms can be influenced by applying the principles

discussed above such as strategic assessments of options and EIA/SIAs and taking a

participatory approach to planning and implementation.

If the guiding principle of social policy in projects has to date been to mitigate or redress any

damage inflicted by the project, it is increasingly recognized that project-affected people

should actually benefit from the project. The principle relates to a question of equity between

those directly or indirectly affected by the project and those directly benefiting from the

project who are located elsewhere and do not suffer the direct effects of the project. A

significant imbalance can occur � for example, there are known cases of hydropower

generation projects internationally where locally affected communities remain without power

supply. From a pragmatic perspective, a policy of benefits-sharing can help to minimise local

resistance to projects, ensuring smoother project implementation leading to additional cost

and time-related.

There are different definitions of the benefit sharing concept and these principally fall into two

categories

1. sharing of direct benefits from project revenues, usually financial (such as company

shares or direct investment in the affected community derived from royalties/taxes)

2. sharing of benefits in a wider context including (1) as well as by provision of social

and economic development as a project offset or additional contribution from the

project developer to the project affected area (above and beyond compensation for

direct impacts).

The IHA Sustainability Guidelines (section 7.3) and Assessment Protocol (Aspect B3)

promote the sharing (allocation) of benefits as a key principle. A wider context definition as

per (2) is used by the IHA and includes employment, knowledge transfer, capacity building,

new industries, improved facilities, and additional amenity. The Sustainable Hydropower

Website (www.sustainablehydropower.org) uses a similar interpretation. For the purposes of

this report, the wider meaning of the term is assumed and discussion, examples, and

28

recommendations relate to possibilities for direct financial benefits through shares or

royalties through to development and capacity building activities.

Benefits to the host state are important and are generally captured by the standard 12% �free

power� royalty which is provided by operators from all commercially functioning plants.

Additional direct benefits to the state can include, such as in the case of Rampur, an

additional percentage of power generated at cost; which is effectively a share of equity

percentage in the project. Other benefits include the flow-on employment and investment and

the development of roads and other infrastructure.

There are examples of where benefit sharing is being attempted in the case study basins.

Under the Rampur project in the Satluj basin, SJVN has set aside Rs 125 million to be

invested during project implementation over a period of five years (or Rs 25 million annually)

in infrastructure and development schemes in project-affected villages, out of which Rs 6.20

million (out of the first-year budget of Rs 25 million) has already been spent/ works in

progress. Thereafter, the villages will get Rs 7.5 million each year in perpetuity. It is

understood that the residents have led the local area development exercise, choosing the

infrastructure schemes they would like to see implemented in their villages. From street-

lighting, through improved water supply to footpaths and footbridges, the villagers have

reportedly identified their particular needs which are being funded by the scheme.

Projects usually outline and budget for social and development activities as part of their

project implementation plan. Involvement of the community in developing these plans, such

as in the Rampur example, increases public support for the project and improves the overall

outcomes from the investment made.

There is certainly a view that there could be more transparent and targeted direction of the

12% payments that are received by governments into activities for the affected areas as well

as the provision of shares in the project to facilitate an ongoing income stream that could be

used for investment in community development programs. This was pursued as part of an

appeal in relation to the Phalenda Hydropower Project. The people of the Phalenda and

Saruna villages and their supporters argued for the provision of free power to those villages

and for the free shares in the project for the life of the project. While the Divisional

Commissioner of Garhwal agreed that afforestation payments should be directed via

Panchayats, he said that the issues of providing free power or shares in the power company

to the local people was a matter of State policy, and therefore beyond his jurisdiction. He

agreed to refer the matter to the State Government.

Recommendations:

29

1. State governments should consider mechanism to dedicate a portion of the 12% �free

power� royalty into a targeted fund for social and economic development activities in

the host regions.

2. State governments in consultation with MoEF to consider mechanism and process for

basin level social and economic development plans and involve community leaders

and organisations in their development and implementation.

3. MoEF to consider funding the development of an Options Paper on benefit sharing

opportunities and how they could be implemented in India. The paper should involve

extensive consultation with developers, government, and community organisations to

establish appetite for (and therefore support for and barriers to) the benefit sharing

approach, models for community shares etc, and identification of tangible ways that

could demonstrate win-win outcomes.

2.12 Local Participation in Project Delivery

Research and consultation has indicated that the impacts of large numbers of migrant

workers on local communities are extremely significant. This is particularly the case for

women villagers who are often fearful of the influx of male labourers, leading to anxiety and

ultimately disruption of their daily routines. There can also be social tensions between male

members of a local community and the temporary workforce. Aside from these social

disruptions, there are some economic benefits to the communities from the injection of

people with incomes to spend on local produce and so on. However, there are also missed

opportunities for local residents to be involved in project implementation, thereby reducing

the potential economic and social benefits of the project to the community.

Given the impacts associated with migration of workers, there is an opportunity to maximise

economic and social benefits to the region through the training of residents. Comments from

scientific institutes noted that such investment in the skills capital of the states should form a

part of the overall hydropower development policy. In Himachal Pradesh, the hydropower

policy explicitly notes generation of local employment opportunities as an objective of the

policy.

Availability of skilled labour is likely to be a constraint to the pace of the proposed

construction program and access to willing and cheap labour skills from outside the project

area (and from outside India) will tend to work against increased local participation, as will

the desire for accelerated implementation of projects. However, the direct benefits and the

reduction of disbenefits associated with imported labour could be considerable if contracts

30

are fairly awarded. Employment opportunities can be developed through favouring local

businesses or other contractors who are proactive about employing and training local people,

as well as through direct employment.

As long as the processes for awarding of contracts are clear and transparent, these

opportunities can have further downstream economic benefits in the area.

There is often considerable knowledge and experience amongst residents about the local

area that can be invaluable to project assessment and delivery. Involvement of local

expertise not only means the project and associated plans and activities are practical but

also increases the likelihood of a successful project that has community support and

minimized environmental and social effects.

The present approach to vocational training is apparently handled by 17 different Ministries

without much coordination, signalling an important need nationwide and an opportunity to

build from national efforts in this area.

Recommendations:

1. State governments should consider immediately developing and implementing a

program for the training and capacity building of people within the regions for the full

range of skills needs, without compromising overall development policy. Liaison with

the Directorate General for Employment and Training (DGET) in the Ministry of Labour

and Employment (which aims to training 20 million people by 2020) should occur to

maximise any opportunities underway at a national level.

2. Consider possibilities for coordinating scheduling between projects to enable workers

to move from project to project, thus reducing the need for outside workers (refer also

recommendations under Multiple Development of Infrastructure). This would require

cooperation between governments and the project developers and would probably be

best taken on by a dedicated river basin authority or sub-agency/committee.

3. State governments should provide coordinated public information across the river basin

about the overall development plans and opportunities for business and employment,

sufficiently in advance to enable local people and businesses to position themselves to

participate in such opportunities.

4. State governments to consider development of practical advice and suggestions to

improve participation in project planning and implementation � this could include but

not limited to; early notification and discussions, involvement of local people in

31

identifying key issues and designing survey requirements, assistance with ecological

and social data collection, assistance with monitoring of implementation. This could be

incorporated into overall template/guidelines for strategic assessments.

5. State governments to consider development of a register of skills in local villages

where hydropower projects are planned to assist in easy identification of particular

areas of assistance with assessments or project planning. This could be perhaps

arranged via the Panchayats.

2.13 Development and Implementation of Resettlement Plans

The displacement of communities has in notable cases been a factor causing significant

opposition to hydropower projects. In some cases, the land has been the home of local

communities, providing their spiritual, social and economic resource base. Resettlement of

people is consequently a sensitive issue, and needs to be planned and managed from

project outset through a process of engagement and economic support.

Population displacement in India has occurred on a range of scales from several families to

tens of thousands of people. While, the run-of-river projects that are proposed on the Satluj

and the Alaknanda will require resettlement of up to several hundred families per project, and

not tens of thousands, managing the process will be critical to ensuring good outcomes for

the communities and the success of the projects.

Typically, social unrest is significantly reduced if clear and consistent policies on social and

economic issues (eg. resettlement and compensation) are in place. International best

practice in social policy development is being driven by a priority for fairness and equity. If

local communities perceive other groups or communities are getting a better deal, the

development in question will face increased problems � including costs and delays.

Inevitably, piecemeal development of the catchment, in the absence of these policies, will

lead to inconsistency and disruptions associated with community support.

As noted in the discussion of EIAs and SIAs, there are aspects of resettlement and

rehabilitation of people that can be improved at the project level. In fact, much of the effort on

improvements should be directed at the project level rather than the river basin level so as to

ensure that the specific local issues are not lost in a regional approach. Addressing impacts

to local people fundamentally needs attention at the local level.

Consultation with NGOs and scientific institutes has pointed to a number of issues regarding

resettlement and rehabilitation in the subject basins (and India generally) that are best

addressed at the project level:

32

Consideration of local community needs � understanding their use of the river and

surrounds, so that compensation, rehabilitation, or development activities adequately

address the losses felt by those residents.

Improved processes for the determination of adequate compensation or resettlement,

particularly beyond one-off cash payments.

Consideration of the impacts of multiple resettlements and the social and economic

futures of displaced persons, with a focus on supporting the establishment of new

livelihoods and so on.

River basin planning can, however, still contribute to improved outcomes for resettlement

and rehabilitation of projects affected persons (PAPs). A river basin planning approach,

especially because of the systems and process that would result, could address the following

gaps:

Need for coordinated input into strategic planning for hydropower to encourage

discussion of effects on people and their livelihoods.

Need for strategic planning to better incorporate the identified likely impacts into site

selection and to better avoid villages.

Need for improved monitoring of implementation against the Resettlement Plans to

ensure obligations have been met and impacts have not been exacerbated.

Need for consistent and transparent process for grievances relating to resettlement

and rehabilitation outcomes.

While many of the recommendations below are aimed at improvements at the project level, a

river basin planning approach most notably offers opportunities for improved communication,

improved data collection & management, improved mechanisms for the dissemination of

good practice guidelines, and improved mechanisms for local imput into basin wide planning

that ultimately sets the scene for project allocation and, therefore, should reduce issues at

the project level due to avoidance.

Recommendations:

1. State governments should consider development of practical advice and suggestions

to guide development of quality assessments and Resettlement Plans which can be

incorporated into wider EIA/SIA template or guidelines.

33

2. State governments and Developers should consider more effective participatory

approach to ensure impacts are properly understood and that community needs are

met through Local Area Development activities (refer also recommendations under

local participation in planning and development process).

3. State governments should consider establishing a basin wide committee with

representatives from local Panchayats; this could be for local area development and

resettlement issues only, or form part of a committee/authority with wider remit.

4. Governments should consider ensuring there is a clear process and mechanism for

grievances to be heard from PAPs.

5. The Central Government should consider a revised method and process to quantify

impact beyond the loss of land or resource to more fully account for the loss of

amenity, cultural practice, and future earnings as part of compensatory payment

determination. An expert could be commissioned to prepare a proposed method.

6. State governments should consider a mechanism for independent review of progress

and compliance with Resettlement Plans, potentially by relevant agency branch or via

a panel of expert providers (institutes or consultants).

7. MoEF and developers could consider consolidating and disseminating verified

information on good practice in resettlement and rehabilitation.

2.14 Impacts to Culture and Heritage

In the absence of an adequate assessment, new hydropower schemes may end up

submerging heritage sites and areas of cultural value. The construction of infrastructure,

roads and power lines can also disturb or damage items with cultural significance. This may

in cases result in the loss of, or damage to, sites with religious or ceremonial meaning for

people. Construction activity, and later restrictions to areas during operation, can impact on

pilgrimage routes and access to important places.

Without sufficient involvement of relevant local and cultural groups, the values and risks for

heritage issues may not be realised and adequately addressed.

The sorts of issues are broad ranging and include:

inundation of sites.

lost oral histories when connection with place is lost.

34

impacts to pilgrams and sites of significance during construction.

changing culture toward urbanisation and associated social ramifications.

native communities and loss of traditional practice.

Although the projects currently proposed in the Satluj and Alaknanda do not involve

significant inundation of land, there are cultural heritage issues that need to be considered.

For example, the Badrinath temple is one of the four most sacred Hindu sites in the region.

Badrinath is situated in the Tehri-Garhwal hill tracks on the Alaknanda River at a height of

3,133 m above sea level. Pilgramage traffic is substantial and already there are safety

impacts associated with the quality of roads to the site. This was most recently (October

2007) demonstrated when 41 pilgrims were killed when the bus on which they were travelling

from Badrinath lost control on the NH 58 at Vishnuprayag and fell into the Alaknanda after

being struck by a boulder (DailyIndia.com). Particular attention will be required during

construction of any hydropower projects to ensure the safety of pilgrims and to minimise

impacts to these culturally significant sites.

Other examples in the region include, the Karcham Wangtoo (1,000MW) project currently

under construction, which is already facing problems with a local tribal population agitating

against the project. Similarly, concern is mounting about socio-cultural issues in the Lahaul &

Spiti district of the Satluj basin, because there are tribal communities inhabiting the area.

Recommendations:

1. State governments to consider funding studies of culture and heritage in relevant

basins to establish a good baseline record of the cultural assets and values, including

local histories and stories.

2. MoEF to consider inclusion of clear requirements of how to assess and manage for

impacts to culture and heritage within current EIAs for inclusion in broader proposed

EIA/SIA guideline/template.

3. Developers to consider increased participation of communities in pre-planning

processes to ensure these values are respected.

4. Developers and State governments should look for opportunities to record, protect,

enhance, or interpret cultural heritage sites in the basin, whether or not directly

affected by the project.

5. Include minimising interference to traditional pilgrimage routes as a major objective

when developing mechanism for the coordination/scheduling of construction projects

35

across the basin.

2.15 Policy Integration

As previously noted, both Himachal Pradesh and Uttarakhand have ambitious hydropower

development goals, and policies have been developed to guide this goal. The States also

have other assets and economic activity to support and grow, such as tourism, agriculture,

and forestry. The objectives and targets from such policies could potentially be in conflict and

it will be a challenge to develop in all areas. River Basin Planning offers a framework for

these other resource development activities to be more integrated.

Recommendations:

1) State governments to consider involvement of representatives from these other core

activities (industry, government, community) being involved in river basin planning

activities.

2) State governments to ensure that other uses are considered as part of strategic

assessments and consider how they can be catered for, perhaps by designating

rivers for particular purposes.

36

3. CONSIDERATIONS FOR THE FUTURE

3.1 Examples of River Basin Planning

3.1.1 India

There is some experience of river basin forums in the case study basins.

Satluj

The first meeting of the Forum of Hydro Power Producers of the Satluj Basin was held on

5 November 2005. This Satluj Forum was an initiative of SJVNL and is not mandated. It is

understood that meetings of developers have only been conducted on two occasions.

The member organisations of the Satluj Forum are:

NTPC

BBMB

HPSEB

Jaypee

Nuziveedu

Himachal Sorang Pvt Ltd (Sorang HEP now being developed by SSJV)

SJVNL

The objectives of the Satluj Forum are:

Environment � To evolve integrated catchment area treatment plan.

Operation of power stations and sharing of technical expertise and experience.

Data sharing � share facilities to generate input data, eg discharge, silt.

Disaster management and planning � to develop and implement effective flood

forewarning and disaster management systems.

Common issues with State government and Government of India.

An article from The Tribune, Chandigarh, 19 October 2005, discusses the Satluj Forum and

states �experts have advised that keeping in view the ever increasing levels of silt in the river,

storage projects should be preferred to run-of-the-river projects. The problem of excessive

silt hampering the smooth operation of the Nathpa Jhakri project will also be faced by the

1000 MW Karcham Wangtu project being set up upstream. However, it could be solved to a

great extent if a 280m high dam is constructed at Khab where the first project after the river

37

enters the country from China is planned. Since such a high dam will more than double the

cost of the Khab project, a cost sharing mechanism to distribute the cost among the

beneficiary projects downstream will have to be worked out. All these issues could be dealt

with effectively if the agencies engaged in execution of projects come under a common

platform.�

The Himachal Pradesh Hydro Power Policy indicates that Local Area Development

Committees (LADC) will be set up for projects being developed in each river valley. Their

role is to oversee the implementation of each project, with emphasis on Catchment Area

Treatment, Reafforesation, and Rehabilitation & Relief Plans. Draft MOUs being sent to

developers who have recently been allocated projects also refer to proposed LADCs, but at

this time it is not clear whether or not any LADC has been established and is undertaking

project surveillance activities.

Alaknanda

Although there are no Planning Forums in the Alaknanda basin, the Additional Chief

Secretary of GOU has advised that a Bhagirathi River Valley Development Authority

(BRVDA) has been established and a Chairman appointed, but it is understood that to date

there is no Secretariat and no activity by the Authority.

The concept of a BRVDA was raised during the 1980s and the first meeting of the BVDRA is

said to have been held on 20 May 2005. Its mandate was to maintain ecologic balance,

provide environment protection, ensure sustainable development, and maintain mechanism

for redressal of public grievances.

3.1.2 International

Okavango River Basin

The three countries of Namibia, Botswana and Angola share the Okavango River basin,

which has remained unaltered by extensive investment in infrastructure. These three Basin

States formed the Permanent Okavango River Basin Commission (OKACOM) in 1994, with

the purpose of promoting sustainable management of the river basin through the

development and implementation of a comprehensive basin�wide management plan.

Recognizing the opportunity presented by OKACOM and the ongoing threats to the resource

and communities that depend on the river, in the late-1990s the International Rivers Network

worked with NGOs to develop a project called. (NOTE: IRN is not currently active in this

program).

38

A project was established with support of NGOs and communities and communities in

Botswana and Namibia called Every River Has Its People: Promoting Co�Management of

the Okavango River Basin.

By the end of 2001, project staff had conducted extensive Socio-Ecological Surveys, in

partnership with local communities, regional and local authorities, and NGOs. Supporting the

Every River project, the Sharing Water project was designed to develop and test a

consensus building, decision-making model and a data management system, broaden

stakeholder participation in the OKACOM planning process, and build capacity in the region

to analyse complex scenarios and to work towards a consensus decision.

Sharing Water was funded by the United States Agency for International Development

(USAID), guided by a Steering Committee and implemented by a broad partnership of

organisations. The Sharing Water Steering Committee included representatives from the

three main existing basin water management projects: Southern African Development

Community (SADC) Water, the Every River Project and the United Nations Development

Program Global Environment Facility OKACOM project. A core group of delegates who were

likely to have future roles in water resource management for the basin were selected from

each Basin State, and represented a wide range of organisations and stakeholders.

Sharing Water offered a joint fact-finding process in the Okavango River basin as a tool to

compile and analyse relevant information and translate it into a form that can be understood

by stakeholders, and used by decision-makers to create the foundation for broad-based

consensus. Community leaders and representatives were involved in the fact-finding and

scenario workshop stages. The Shared Okavango/Kubango Database was a concrete

outcome of this process, and acted as a key modelling input.

An analytical platform that linked databases, hydraulic and hydrologic analysis, scenarios

and collaborative learning was used to develop a prototype river basin planning model for the

Okavango River system. The Water Evaluation and Planning System (WEAP), developed by

the Stockholm Environment Institute, was the chosen platform and incorporated not only

water yield and power production, but was also capable of processing licensing

arrangements and developing and managing numerous scenarios about future water

management arrangements. The use of scenarios to explore ecological dynamics of

alternative futures has been advocated through the recently completed Millennium

Ecosystem Assessment, a 4-year initiative to investigate relationships between ecosystem

services and human well-being at multiple scales.

The Sharing Water project supported an analysis of legal and institutional arrangements that

39

govern river basin management in the Okavango Basin across the local, national,

transboundary and international scales, and provided recommendations on how to bridge

gaps and disconnection in policy, legal and institutional structures.

Mekong River Basin

The Mekong River Commission (MRC) was formed on 5 April 1995 by an agreement

between the governments of Cambodia, Lao PDR, Thailand and Viet Nam. The four

countries signed The Agreement on the Cooperation for the Sustainable Development of the

Mekong River Basin and agreed on joint management of their shared water resources and

development of the economic potential of the river.

The four goals for 2006-2010 are:

Goal 1: To promote and support coordinated, sustainable, and pro-poor development;

Goal 2: To enhance effective regional cooperation;

Goal 3: To strengthen basin-wide environmental monitoring and impact assessment;

Goal 4: To strengthen the Integrated Water Resources Management capacity and knowledge

base of the MRC bodies, National Mekong Committees, Line Agencies, and other

stakeholders.

From 1955 through to the mid-1960s, the Mekong Committee conducted hundreds of

surveys and studies to map, measure, sample and catalogue a rich diversity of resources.

These studies were the basis of an ever-expanding 'knowledge base' now maintained by the

Mekong River Commission.

Since the 1995 Agreement that, the member countries have signed sub-agreements on Data

and Information Sharing and Exchange, a Flood Management and Mitigation Strategy, and a

formal agreement with China on the exchange of hydrological and other data.

The aim of many early Mekong Committee surveys was to gather data for irrigation flood

control and hydropower projects. Over the last 50 years, much has been learned about dams

and their impacts The Commission has responded with a hydropower development strategy

based on principles that recognise the rights and needs of multiple users, the value of public

participation in planning, and protection of the environment. Similarly, the knowledge gained

from early efforts to 'control' floods led to greater understanding of flood management and

mitigation.

The unharnessed hydropower potential of the Mekong region stands high on the options list,

40

and is therefore earmarked in national strategies to contribute an important share of the

prospective electricity demand. Since the environmental impacts of hydropower are difficult

to ascertain, they are at risk of being underestimated (Malik, U., Cogels, O., and Coull, E.,

2007)

Environmental Criteria for Hydropower Development (ECHD),

Three organisations - ADB, MRCS and WWF - joined forces to investigate options for the

development of Environmental Criteria for Hydropower Development (ECHD), which aimed

to provide interested stakeholders with information, knowledge and tools to better manage

hydropower so that the ecological functions of rivers, the natural resources they provide to

other economic sectors, and the livelihoods of people that depend on them are maintained

acceptably and appropriately.

The report analyses the environmental policies and criteria of each GMS country, regional

institutions like the MRC, the main multilateral institutions involved in the GMS (ADB, World

Bank, World Commission on Dams (WCD), Japan Bank for International Cooperation (JBIC),

and the Equator Principle private banks.

The report reviews several attempts at formulating an industry standard including the Green

Hydropower Project in Switzerland, various �green� certification schemes (such as the

Technical Inspection Association in Germany, Future Energy in the UK, Naturemade Basic in

Switzerland, Eco-Logo in Canada, Bra Miljoval in Sweden, Grüner Strom Label in Germany,

and Green-e in the USA), the US Power Scorecard, the International Energy Agency�s

Hydropower Agreement, the Low Impact Hydropower Institute�s (LIHI) certification criteria,

and the International Hydropower Association (IHA) Sustainability Guidelines.

Of the three international environmental criteria frameworks reviewed, the IHA Sustainability

Guidelines was considered to be the most comprehensive and a possible best starting point

for the Greater Mekong Sub-region.

Although the MRC is an international river basin planning organisaiton and has many other

challenges associated with international planning and cooperation, there could be valuable

outcomes from the ECHD program that could be used in developing strategic assessment

and river basin planning principles in India.

Vu Gia-Thu Bon River Basin, Viet Nam

The Government of Viet Nam is turning to hydropower development as part of a

modernisation and poverty reduction program. At the centre of Viet Nam's hydropower

agenda is the Vu Gia-Thu Bon River Basin in Quang Nam province. Eight hydropower

41

projects are proposed for the next 10 years in this basin, with some dams already under

construction.

The combination of pre-existing environmental issues, such as coastal flooding and changes

in river alignments, erosion, salinity intrusion, droughts, and industrial pollution means that

the introduction of hydropower generation in the basin will require a more coordinated

institutional response than the mandate that any one agency can provide.

With assistance from the Asian Development Bank (ADB) a Pilot and Demonstration Activity

Project was established a new generation of river basin organisation (RBO) is being tested.

Past experience in Viet Nam included two out of the three major RBOs rarely meeting since

they were formed. Also problematic in the past has been their location in either Hanoi or Ho

Chi Min City, rather than based near the communities on the management frontlines.

The Project sought to develop a solution that avoided these problems. The key findings from

the project were the need for the RBO to be simple, practical, replicable and flexible. The

formation of the body was demand driven, which means that the local villages/districts in the

basin were involved in developing the structure. Therefore, the consultants recommend that

the most practical and functional model is developed together with the stakeholders. Given

the concept was fairly new in Viet Nam (aside from examples of international basins such as

the Meekong), it was considered important to ensure that the mandate of the RBO was

flexible so that it could be revised as awareness of members improves and the scope

increases. Membership was balanced and all areas within the basin were represented which

ensures that it remains sustainable (Tim McGrath, ADB Consultant, pers. comm.).

Cultivating Good Water Program � Itapu Binacional (Brazil / Paraguay)

The Cultivando Agua Boa Program, initiated by Itapu Binacional, is an excellent example of

community cooperation to address catchment-wide environmental, social, and economic

issues. The program is focussed on the catchment area above the Itapu Power Plant on the

Parana River. It works on the basis of partnerships across the various micro-basins with 21

municipalities having signed Water Pacts.

The catchment is heavily populated and has been rapidly deforested over the last 50 years.

There are significant environmental, social, and economic issues that the Program is aimed

at addressing. Key features of the Program include obtaining ownership at the local level,

capacity building through training programs, economic development through a range of

initiatives including new agricultural programs, and environmental protection. Over 100,000

hectares have been set aside for protection. Biological reserves and corridors have been

42

created and an extensive riparian vegetation protection and planting program has been

introduced. New farming technologies have been fostered to address issues such as erosion

and pesticide pollution. New waste management facilities have been built and new waste

management practices encouraged.

The Cultivando Agua Boa Program is a good model to examine when considering

improvements to catchment treatment activities in India.

3.2 Implementing River Basin Planning in India

There is compelling evidence, quantitative and qualitative, to suggest that there are

economic, environmental and social benefits for all stakeholders to be gained from a river

basin planning approach, through:

Strategic yield estimates based on basin wide information and with full context of

possible projects to be developed

Strategic approach to project identification, comparison of alternatives and cumulative

effects including strategic environmental and social assessment

Transparency and public participation in planning and implementation improving

outcomes, project support, and reducing project delays

Coordinated planning for benefit sharing and broad socioeconomic development,

providing additional benefits to the host communities

Coordinated planning of construction sequence and shared infrastructure.

A comprehensive river basin planning approach is a major undertaking that could realistically

take a number of years to establish the relevant baselines, skills and tools, guidelines, and

operating framework for its implementation. There are a number of challenges in the existing

system and current practice of developing hydropower projects in India influencing the

likelihood of effective implementation of a river basin planning approach. These include the

number of agencies currently involved, the time and negotiation required for changes to legal

instruments, bureaucratic processes and need for substantive changes or streamlining, the

limited skills and tools available, and the need for increased resources (people and funds) to

implement actions.

However, a river basin planning approach can be achieved to varying degrees and in a

phased way through, for example, uptake of strategic regionally based economic, social and

environmental assessments, as well as basin wide yield estimates and establishment of

43

wider development or benefit sharing activities in the host regions.

Learnings may be possible from experience in other sectors. For example, in Himachal

Pradesh, there has been a state-wide Forest Sector Review in 1999-2000 which notified the

constitution of three tiers Panchayat, Block and District level Forest Committees. The

Participatory Forest Management Rules, notified by the Government of HP on 23 August

2001, supported these committees. Later, in August 2001, notification on H.P. Forest

Consultative Forum was issued, that was formed to strengthen cross-sectoral linkages and

involvement of local level stakeholders in sustainable forest management. A comprehensive

consultation process involving 81 villages has led to strong ownership of the new Forest

Sector Policy. A key feature of the new policy is the the strengthening and re-constitution of

an independent, autonomous and multi-sectoral Centre for Policy and Planning. It also

includes the efforts to promote cross-sectoral collaborative mechanism and converges extra

sectoral policy influences. Lastly, the policy envisages a long term investment programme for

forest sector funding commensurate with the contribution of forest to the state GDP through

public sector participation and need based international funding and regular budgetary

allocation (Kapta, S. 2006)

The enormity of implementing a completely new system would require considerable time to

establish and, therefore could hold up valuable improvements in the meantime or, potentially

delay the hydropower development program.

A move toward river basin planning could include:

Informal, cooperative development of tools and databases to facilitate river basin

considerations in project planning and implementation, which could be formalised

through a central agency or independent body for the ongoing maintenance of data

integrity.

Establishment of a developers� forum similar to those in Satluj, Bhagirathi or Narmada

Valley; although preferably with stronger participatory requirements and supportive

mechanisms for data sharing and decision-making.

Redefinition of responsibility and funding of a program through a lead agency to

facilitate river basin planning and development, similar to efforts in HP in the forestry

sector.

Establishment of a new institution, with legal mechanism to establish representative

membership and to provide clear responsibility for river basin planning that may affect

the distribution of risks across individual players and the government. .

44

Regardless of the system or process put in place, based on experience elsewhere noted

above, the keys to a successful river basin planning model are that it must be:

Simple

Authentic

Transparent

Participatory

Representative

Practical

Mandated

Replicable

45

4. REFERENCES

Basson, G.R. (2007) �Assessment of Global Reservoir Sedimentation Rates�; paper

presented at ICOLD International Conference, St Petersburg, 2007

Bohensky, E.L, Reyers, B. and Van Jaarsveld, A.S. (2006). Future ecosystem services in a

Southern African river basin: A scenario planning approach to uncertainty. Conservation

Biology, in press.

Kapta, S., (2006) Making Policy that Works-Participatory Policy Formulation Process in H.P.

Forest Sector; Institute of Integrated Himalayan Studies (UGC-Centre of Excellence)

Himachal Pradesh University, Shimla.

Malik, U., Cogels, O., and Coull, E., (2007) Foreward, in King, P., Bird, J., and Haas, L., The

Current Status of Environmental Criteria for Hydropower Development in the Mekong

Region, WWF�Living Mekong Programme, Vientiane.

Pottinger, L. (2004) Can the Nile States cam their way to cooperation? International Rivers

Network, California.

Sharma, H.K. et al., (2006) �Prospects of Hydro Development in the Back drop of

Environment Impacts, Legislation, and Procedures with special reference to Rampur HEP &

Future Course�, Paper presented at All India Seminar on Environmental Consideration in

Planning and design of Power Projects; Nov 9-11, Dehradun.

Sharma, H.K., et al., (2006a) �Environmental Management of SJVNL in Nathpa Jahkri Hydro

Power Project�, Paper presented at All India Seminar on Environmental Consideration in

Planning and design of Power Projects; Nov 9-11, Dehradun.

Sharma, HR (n.d.) A note on Environmental Flow (unpublished).

Singal, V.K., (2006) �Time and cost over-run in hydro-electric projects and its control�,

Energy India; Jan-Mar; pp. 67-70.

Singh, S., Banerji, P. (eds) (2002) Large Dams in India: Environmental, Social and Economic

Impacts. Indian Institute of Public administration, New Delhi.

USAID (2005) Sharing Water: Towards a transboundary consensus on the management of

the Okavango River Basin. United States Agency for International Development.

www.sustainablehydropower.org www.hydropower.org

46

5. GLOSSARY

BBMB Bhakra Beas Management Board

Brakel Brakel Corporation of the Netherlands

CAT Catchment Area Treatment

CEA Central Electricity Authority

CWC Central Water Commission

DPR Detailed Project Report

EIA Environmental Impact Assessment

Gammon Gammon Infrastructure Projects Ltd

GLOF glacier lake outburst flood

GMR GMR Infrastructure Ltd

GOHP Government of Himachal Pradesh

GOU Government of Uttarakhand

GVK GVK Industries Ltd

HEP Hydro Electric Project

HPC Himachal Power Corporation

HPSEB Himachal Pradesh State Electricity Board

IEI Institution of Engineers (India)

IIDC IL&FS Infrastructure Development Corporation Limited

IPP Independent Power Producer

Jaypee Jaiprakash Associates Limited

L&T Larsen & Toubro Limited

MOP Ministry of Power

47

MOU Memorandum of Understanding

NEEPCO North Eastern Electric Power Corporation Limited

NHPC National Hydro Power Corporation

NTPC National Thermal Power Corporation

Nuziveedu Nuziveedu Seeds Limited,

PFR Preliminary Feasibility Report

Powergrid Power Grid Corporation of India Limited

RFP Request for Proposal

SANDRP South Asia Network on Dams, Rivers & People

SIA Social Impact Assessment

SSJV Satyam Shankranayanan Joint Venture

SJVNL Satluj Jal Vidyut Nigam Ltd

SVP Sanjay Vidyut Pariyojna

THDC Tehri Hydro Development Corporation

UIPC Uttarakhand Infrastructure Project Company Pvt Ltd (JV between IIDC and

GOU)

Uttarakhand previous name of Uttarakhand

UJVNL Uttarakhand Jal Vidyut Nigam Ltd

WAPCOS Water and Power Consultancy Services (India) Limited

WB World Bank

WCN Wildlife Conservation Network

48

APPENDIX 1 � STUDY AREA

Satluj Basin The Satluj River rises in China and flows generally west through Himachal Pradesh and

Punjab until it joins the Indus River in Pakistan. That part of the Satluj basin under current

study is from the Chinese border to Bhakra Dam on the Himachal Pradesh / Punjab border.

The principal tributaries are the Spiti (joining from the right or northern side), and the Tidong

and Baspa (joining from the left or southern side).

Figure A1.1 shows this basin, together with the considerable Satluj catchment area on the

Tibetan plateau in China.

Figure A1.1 � Satluj Catchment Area

Figures A1.2, A1.3 and A1.4 show the Digital Elevation Model, the land use, and the

hydropower projects in the Satluj basin, together with protected areas.

49

Figure A1.2 - Digital Elevation Model of Satluj Basin

50

Figure A1.3 � Land use in Satluj Basin

51

Figure A1.4 � Hydropower Projects and Protected Areas in Satluj Basin

Table A1.1 presents a summary of the hydropower projects, and Table A1.2 includes some

details.

Table A1.1 � Satluj Basin Projects

Developer Satluj Basin Projects HPSEB Other Govt. Private

Operating 5 1 3 1

Under construction

5 2 2 2

Under development

9 2 2 5

To be allotted 9 - - 9

Total 28 5 7 17

52

Table A1.2 � Satluj Basin Project Details

Site Size Proponent Status/Comment

Kuling Lara 40 MW (Spiti) bids from private developers being assessed.

Lara 60 MW (Spiti) bids from private developers being assessed.

Mane Nadang 70 MW (Spiti) bids from private developers being assessed.

Lari Sumte 104 MW (Spiti) bids from private developers being assessed.

Sumte Kothang 130 MW (Spiti) bids from private developers being assessed.

Chango Yangthang

140 MW (Spiti) Malana Power recently awarded

Yangthang Khab 261 MW (Spiti) bids from private developers being assessed

Khab 1020 MW SJVNL under development

Ropa 60 MW (Ropa) Malana Power recently awarded

Jangi Thopan 480 MW recently awarded to Brakel

Tidong-II 60 MW (Tidong) recently awarded to Gammon

Tidong-I 100 MW Nuziveedu under development

Thopan Powari 480 MW recently awarded to Brakel. Proposal to make a single project with Jangi Thopan

Kashang-I 65 MW (Kashang) HPSEB under development

Kashang-II 48 MW (Kashang) HPSEB under development

Kashang-III 130 MW (Kashang)

HPSEB under development

Shongtong-Karcham

402 MW HPSEB under development

Baspa-I 210 MW (Baspa)

Earlier regarded as unviable on environmental grounds, but a revised project has been proposed by a private developer.

Baspa-II 300 MW (Baspa)

Jaypee operating since 2003

Karcham Wangtoo 1000 MW Jaypee

under construction, commissioning expected 2011

SVP Bhaba 120 MW HPSEB operating

Nathpa Jhakri 1500 MW SJVNL operating

Sorang 100MW(Sorang) SJVNL under development

Rampur 412 MW SJVNL under construction

Luhri 750 MW SJVNL under development

Kol Dam 800 MW NTPC under construction

Beas Link 990 MW BBMB operating

Bhakra Dam 1325 MW BBMB operating

53

Eight projects are proposed for the Spiti River in the Lahaul & Spiti district. The Spiti River

originates from the Kunzum and the slopes draining the famous Pin River Valley area are

also a part of the Spiti River system. The river attains peak discharge in late summers due to

glacier melting but its position behind the main Himalayan range deprives it from the benefit

of the South-West monsoon. The terrain of the district is a cold desert with huge deposits of

morains and an absence of any vegetation cover, which contributes to the Spiti River�s silt

loads that are known to be high. Even though there are a number of small settlements along

the valley, Kaja is the only major settlement along the Spiti River, although Tabo and

Dhankar Gompa are other noteworthy settlements.

The proposed Chango-Yangthang (140 MW), Yangthang-Khab (261) and Khab (1020 MW)

projects are situated in the Kinnaur district. The Khab project would lead to submergence of

a large area of land, however no settlement would be submerged. Local residents have

nevertheless been vocal in objecting to Khab which has apparently delayed some of the

investigative studies. The proximity to the international border with Tibet (China) could be a

major hurdle in obtaining environmental clearance.

The under construction Karcham Wangtoo (1,000MW) project is already facing problems and

the local tribal population is agitating against the project causing law and order problems in

the area.

Alaknanda Basin

The Alaknanda basin is wholly contained within Uttarakhand. The Alaknanda River rises near

to the Chinese border in the north of the State, and flows in a south then east direction until it

joins the Bhagirathi River to form the Ganga (Ganges River) at Devprayag. The principal

tributaries are the Dhauliganga and Pinder (joining from the left or western side), and the

Mandakini (joining from the right or northern side).

Figures A1.5, A1.6 and A1.7 show the Digital Elevation Model, the land use, and the

hydropower projects in the Alaknanda basin, together with protected areas.

54

Figure A1.5 � Digital Elevation Model of Alaknanda Basin

55

Figure A1.6� Land use in Alaknanda Basin

56

Figure A1.7 � Hydropower Projects and Protected Areas in Alaknanda Basin

Table A1.3 gives a summary of the hydropower projects, and Table A1.4 some details.

Table A1.3 � Alaknanda Basin Projects

Developer Alaknanda Basin Projects UJVNL Other Govt. Private

Operating 1 1

Under construction

2 1 1

Under development

16 5 7 4

To be allotted 4 4 (plus 10 ?)

Total 23 5 8 10

57

Table A1.4 � Alaknanda Basin Project Details

Site Size Proponent Status/Comment

Alaknanda 300 MW GMR under development

Vishnu Prayag 400 MW Jaypee operating since 2006

Malari Jhelum 55 MW (Dhauliganga) THDC under development

Jhelum Tamak 60 MW (Dhauliganga) THDC under development

Tamak Lata 280 MW (Dhauliganga) UJVNL under development

Deodi 60 MW (Rishiganga) to be allotted

Rishiganga-I 70 MW (Rishiganga) UJVNL in Nanda Devi Sanctuary

Rishiganga-II 35 MW (Rishiganga) UJVNL in Nanda Devi Sanctuary

Lata Tapovan 171 MW (Dhauliganga) NTPC under development

Tapovan Vishnughad 520 MW NTPC under development

Vishnughad Pipalkoti 444 MW THDC under development

Bowala Nand Prayag 300 MW UJVNL under development

Gohana Tal 60 MW (Birahiganga) THDC under development

Nand Prayag Langasu 141 MW UJVNL under development

Devsari 141 MW (Pindar) SJVNL under development

'Bagoli 72 MW Padli 27 MW (Pindar) IL&FS / GOU under development

Rambaru 76 MW (Mandakini) LANCO DPR in preparation

Phatu Byung 76 MW (Mandakini) LANCO DPR in preparation

Chuni Semi 26 MW (Mandakini) expected to be allotted to a private developer

Singoli Bhatwari 99 MW (Mandakini) L&T under development

Shrinigar 330 MW GVK under construction

Khoti Bhel - 1B 320 MW NHPC under development

Only 3 hydropower projects are operating or are under construction in the Alakananda basin,

so hydropower development in this basin lags that of the Satluj basin where there are 10

projects either operating or under construction. Of particular importance to the Alaknanda

58

basin is tourism, driven not only by the scenic value of the area but more so by the number of

very important religious sites. Tourist traffic on the narrow windy roads, combined with the

expected increasingly heavy traffic associated with hydropower project construction, is a

major source of concern from a safety view point.

59

APPENDIX 2 � INDIAN REGULATORY CONTEXT

Uttarakhand Hydropower Policy

To support its hydropower development objective, the Government of Uttarakhand

established a hydropower policy covering small and large projects, in order to attract

investors for the development of the State's water resources in an environmentally friendly

manner, and to generate revenues for the State through hydropower generation.

On all projects governed by the policy for the first 15 years, royalty at the rates of 12% of net

energy wheeled (after deducting wheeling charges) or supplied directly without wheeling

would be charged. Beyond the 15th year of operation, IPPs are required to provide a royalty

of 18% of net energy wheeled or supplied directly without wheeling to the GoU. No further

levies, taxes, charges would be levied by the State Government and its agencies or the

Regulator on the IPPs, for a period of ten years from the date of this policy.

Himachal Pradesh Hydropower Policy

Himachal Pradesh has also developed a policy to supports its hydropower development

objectives. The policy is more detailed than that of Uttarakhand and is heavily focused on

wider objectives of the policy.

General Goals and Objectives

The Hydro Power Policy 2006 of Himachal Pradesh primarily aims to:

i) Develop Himachal as a �Hydro Power State� to provide affordable, reliable and

uninterrupted power to customers throughout the year;

ii) Create employment opportunities for residents of Himachal Pradesh while mitigating

environmental and social impacts of hydro power projects.

The principal objectives of the policy include (but not limited to):

To make the power sector a major source of income for the State and secure long

term financial interests of the State;

To finance local area development through power projects;

To establish and promote a power trading entity in the State;

To protect the rights of local water users (irrigation and potable water use etc.) within

the State;

60

Address environmental impacts of hydro power projects by adopting suitable

mitigation measures;

The policy provides detailed terms and condition for Category I projects (projects above 5

MW to 100 MW installed capacity) and Category II projects (projects above 100MW installed

capacity). Hydro power projects are allotted to prospective independent hydropower

producers on Build, Own, Operate, Transfer (BOOT) basis.

Transmission Load Despatch and Power Trading

The policy states that the Government of Himachal Pradesh must prepare a Transmission

Master Plan for the period 2007 � 2012 and that the plan will cater to absorb all generated

power from hydropower projects to the maximum possible extent. The policy also states that

the Government of Himachal Pradesh shall adopt availability Based Tariff (ABT) to effect

improvement in grid disciplines and mean optimum utilization of resources. In view of power

being available for trading, the policy states that the Government of Himachal Pradesh shall

endeavour to establish power trading under its control to ensure prudent commercial

practices.

Distribution

The policy also creates an enabling environment to implement the provisions related to

power supply and distribution under the Electricity Act (2003). The policy enlists a number of

actions to enhance the distribution sector within the State. These include:

To improve LT and HT ratio;

Reduce aggregate technical and commercial loss;

Introduce a profit centre concept to make the Distribution Business more profitable;

Support the implementation of reforms under the Accelerated Power Development

and Reform Program1;

Facilitate open access in the distribution sector;

Introduce state-of-the-art technologies in the distribution sector;

Support energy conservation and demand side management.

1 A program introduced by the Indian government to introduce reforms in the distribution sector.

61

Rural Electrification

The policy states that the Government of Himachal Pradesh will be committed to ensuring

that power supply is available to 100% of villages and hamlets in the State. A number of

actions to improve the existing distribution system to cater to rural areas are specified under

the policy.

These include:

Provide household electrification to every rural household on demand;

Create an enabling environment to provide Single Point (Bulk) supply and encourage

local / community distribution management;

Provide quality and reliable power to all rural households;

Generate assured revenue by improved collection;

Ensure 100% electronic metering on all categories of consumers;

Set up special courts to provide speedy trials for offences relating to theft of

electricity.

Project Approvals

The project approval process is described in the flow chart of Figure A2.1.

62

Figure A2.1 - Approvals process for hydro-electric projects

63

APPENDIX 3 - CONSULTATION

Organisation Representatives Meeting

or phone

call

Modelling

Workshop

Final

Workshop

Non-government Organisations and Institutes

Matu People�s

Organisation

Mr Vimalbhai

National Campaign for

People Rights to

Information

Mr Shekhar Singh

Rashtriya Himalayan Niti

Abhiyan, Chamba (H.P.)

Mr Kulbhushan

Upmanyu

Gopeshwar (Garhwal),

Uttarakhand

Mr Chandi Prasad

Bhatt

Winrock International

India

Mr Sanjeeva Pandey

Mr Sundarlal Bahuguna Mr Sundarlal

Bahuguna

Shri Bhuvneshwari Mahila

Ashram (SBMA)

Mr Cyril R. Raphael

Mr Mayank Joshi

RANCHA Mr Manoj Bhatt

People Science Institute Dr Ravi Chopra

Mr Ayan Biswas

Mr Devashish Sen

Mr Salil Das

Mr Divakar Dev

Himachal Pradesh Gyan

Vigyan Samitti, Shimla

Dr Omprakash

Bhuraita

64

Dr R S Thakur

Mr Kuldip Tanwar

Environics Mr Sreedhar

Environics Mr Nishant Alag

Institute of Integrated

Himalayan Studies, H.P.

University, Shimla

Dr B S Marh

Dr Ravinder Sood

Dr Richa

South Asian Network on

Dams , Rivers and People

(SANDRP)

Mr Himanshu Thakkar

Hazard Centre, New Delhi Dr Dunnu Roy

IEI Dr G.S.Yadava

Chairman

CISMHE Dr M.K.Pandit

Professor&Director

WAPCOS Mr D.Datta

CMD

Wildlife Conservation

Network

Ms Stacey J Iverson

Program Manager

Prof Yudhbhir

State Government

GoU, Dehradun Mr Indu Pande,

Additional Chief

Secretary

Mr Shatrughan Singh

Power Secretary

*Dr M.C.Joshi

65

Additional Secretary

UJVNL Mr. Yogendra Prasad

Chairman

Mr S.P.Singh

MD

Mr Vivek Singla

Exec Dir Business

*Mr Alok Kumar

DGM

Mr Subhash Chand

Chabbra

Mr S K Rastogi

GoHP S.S.Guleria

Add.Sec (Power)

Dr Shrikant Baldi

Secretary MPP &

Power

State Council for Science,

Technology and

Environment, HP

Dr R K Sood

Department of Energy,

HP

Mr J.P Negi

Principal Secretary

HPSEB, Shimla Mr Shamsher Singh,

CMD

Mr R L Chauhan

Member (Civil)

Ram Mohan Gupta

Director Planning

Kinnar Kailash Power

Corp.

66

D.S.Verma

Sen. Exec. Eng.

Man Mohan Singh

Chief Engineer

(Generation)

Department of Irrigation

and Health

R.N.Sharma

Engineer in Chief

Deepak Shanan

Principal Secretary

Central Government

Central Electricity

Authority

Mr Rakesh Nath

Chairman

Mr Yum Subramanian

Chief Engineer

Mr S.D Dubey

Director

Mr Pradeep Shukla

Deputy Director

Mr Tanmoy Das

CWC Mr S.K.Das

Chairman

Mr C.S.Mathur

Chief Engineer

Ministry of Power Mr Jayant Kawale

Joint Secretary

(Hydro)

Mr Anil Kumar Kutty,

Joint Secretary

Mr Rajesh Verma

67

Director

Mr V Rama Krishnan

NHPC Mr Siba Prasad Sen

Director (Technical)

Mr Rajeev Baboota

Mr Manjusha Mishra

NTPC Mr K.B.Dubey

Exec Dir (CMG)

Mr S.K.Shukla

Mr S.C.Gupta

NEEPCO Ms Debjani Dey

Mr Ashok Kr.

Mr S S Adhikari

PTC Mr seth Vedantham

Central Government Joint Ventures

BBMB Mr U.C.Misra

Chairman

Mr Anil Arora

Member Irrigation

R.C.Mahajan

Secretary

Ashok Gupta

Dep Sec

Mr N.K.Arora

Member Power

Mr Balbir Singh

Member Irrigation -

Retired

68

Mr Rajeev Bansal

Mr V K Mittal

Mr S P Singh

SJVNL Mr H.K.Sharma, CMD

*Mr H.B.Sahay, Head

Corporate Planning

THDC Mr R.S.T Sai

CMD

Mr P.P.S.Mann

Mr Vijay Sehgal

Mr J.L.Narang

Mr J.K. Varshney

Mr Rakesh Khare

Mr Rajeev Dhall

Private Developers

Brakel Mr Dean Gesterkamp

CEO

Mr Anil Wahal

Director

Managing Director

Mr Gautam

Gammon Mr Parvez Umrigar

MD

Mr Suhrid Ghosh

Dep GM

Mr S.K.Anil

GMR Mr B.Vanchi

69

Director

Mr Avinash Shah

Sen VP-Power

Mr Vivek Jhamb

Mr Harvinder

Manocha

Mr Rajeev Mishra

GVK Mr V.Rama Rao

Director technical

Mr M.Sivaji

Director � Project

Development

ICCS Mr A B Giri

IL&FS Mr G.Pharlia

Advisor-Hydro

Mr Pradeep Aggarwal

Senior Manager

Mr N.D.Arora

Mr Dinesh Mittal

India bulls Mr Murali

Suramanyam

Mr Ranjit Gupta

Jaypee Mr Sunil Sharma

Exec Vice Chairman

Mr C.K.Agarwal

Mr Vatsal Chopra

L&T Mr N.Raghavan

VP Hydro Power

Sector

70

Mr N.Parameswara

Rao

Lanco Mr Karpaga Ganesh

Malana Power Mr Awadh B Giri

CEO

Nuziveedu Mr G.Chowdaraiah

VP (Hydel Projects)

Reliance Mr Sandeep

Mr Ashutosh

Srivastava

SSJV Mr Purohit

GM

Mr Vara Prasad

Business

Development