A more realistic approach to boosting power production in the State is in the offing. The State Cabinet has approved incurring a subordinate loan of 2500 crore rupees from the Union Finance Ministry to commission the most important 1000 Mega Watt Pakaldul Hydroelectric Project and make it financially viable. Details of this power generating project have been fully worked out and discussions with the concerned at Central level have also been held. The issue at hand is of high cost estimate and the resultant increase in tariff per unit supplied to the consumer. The completion cost of the project at June 2012 price level is estimated at Rs 12663.03 crore with likely tariff of Rs 8.22 per unit and at such a high tariff, the project would be not be commercially viable.
Therefore, the Centre has made suggestions that the cost expenditure should be revised and reduced. This could perhaps be done by reframing the cost of land and other ingredients.
The Centre agreed to subordinate loan of 2500 crore rupees by way of augmenting the building of the project and making it functional. But at the same time, it put some conditions which the State Cabinet has considered and formally conceded, thereby clearing the way for the execution of the project. The conditions are (a) exemption from Works Contract Tax/Entry Tax, (b) waiver of 12% free power (c) waiver of water user charges for a period of 10 years from the completion of the project. In addition, the Cabinet gave nod to the issuance of consent to the purchase of 49% of power from Pakaldul project.
This big project was to be initially executed by the NHPC which had even done some preliminary work of clearing various statutory obligations. But then the State Government decided to hand over the project to Chenab Valley Power Projects Private Limited, a Joint Venture company formed between NHPC, Jammu and Kashmir State Power Development Corporation and Power Trading Corporation.
Ordinarily, while the Government is justified to evaluate all aspects of the project before giving a final nod, common man may not be interested in going into those details. What people will care for is that they want uninterrupted electric power to run the daily life and that too not at exorbitant tariff. We appreciate that at least the Government has not only to demonstrate that it is serious on the matter of power but has also made some vital concession stated above which will and should facilitate speedy execution of the project with the loan promised by the Finance Ministry.
Needless to say that only a few days back, the Chief Minister was inaugurating another project of streamlining the supply of electric power in Jammu. During the course of his speech he emphasized on his Government’s effort to improve the power generation, transmission and distribution system in the entire State. He enumerated big and small power generating units functional across the state and promised a bright future of the industry in a short time from now. In his view the State is geared to produce 9000 MW of electric power which will not only meet the requirements of the State in full but will also leave some surplus to be sold to the neighbouring states. We had thrown light on that phenomenon and called it revolutionizing the power generation in the State.
The Pakaldul Hydroelectric Project under discussion is part of the future programme which the Chief Minister hinted at. It will certainly augment power position in the State when completed and made functional. It is appreciable that the State Cabinet did not let it get bogged with administrative intricacies which are the bane of most of our developmental projects. We believe that an attitude of cooperation and understanding between the Centre and the State has to be the cornerstone of their relationship. Our quest for energy will not come to a final end with the execution of Pakaldul power plant. We have still to go a long way in becoming self sufficient in the matter of power. More power generating units will have to be installed in due course of time and given a modicum of understanding and cooperation, it should be possible for the State to lay the sound foundation for self sufficiency in power generation enterprise.
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