New CERC rule limits connectivity to inter-State network.

Anil Sasi/ Bussinessline

New Delhi, Feb. 7

Small hydro projects and captive units are getting the wrong end of the regulatory stick – ironically at a time when the Government is making concerted attempts to bring on board all available generating capacities to tide over shortages.

A new set of regulations issued by the Central Electricity Regulatory Commission (CERC) stipulate that a generating station having an installed capacity of less than 250 MW will not be eligible for seeking connectivity with the inter-State transmission system, even if the developer is prepared to lay a dedicated line up to the grid pooling point.

Projects that could be affected include small hydro stations, including a number of private sector plants coming up in Himachal Pradesh, Sikkim and Arunachal Pradesh, as well as most captive units having surplus power.

The Central Electricity Authority (CEA) – the statutory body looking at broad policy and operational issues in the power sector – has now stepped in and asked the CERC to amend the regulations to facilitate connectivity of these smaller generation stations to the grid.

Under Clause 2 (1) (b) of CERC's regulations on grant of connectivity, medium and long-term access in inter-State transmission, an applicant for grant of connectivity can be a generating station of installed capacity of 250 MW and above. This, according to CEA officials, is dealing a body blow to a number of small hydro projects that are set for commissioning across the Northern and North-Eastern States.

The CERC's “Eligibility for connectivity to inter-State Transmission System” regulations, dated August 7, 2009, have been operationalised from January 1, 2010.

In Himachal Pradesh, a number of hydro projects having capacities of less than 250 MW are been planned to be connected directly to inter-State transmission system. These include the 70-MW Budhil hydroelectric project (HEP), the 192-MW Allain Duhangan project and the 100-MW Malana II station.

In Sikkim, a large number of HEPs below 250 MW are planned to be connected to inter-State transmission system pooling points, including the 118-MW Chujachen HEP, the 96-MW Rongichu HEP, the 54-MW Bhasmey HEP, the 99-MW Tingting HEP and the 120-MW Rangit IV HEP.

In case of Sikkim and Arunachal Pradesh, the State Electricity Departments are not equipped to develop the transmission system for the private projects. If direct connectivity to the ISTS is denied even through dedicated lines, it will cause a setback to the development of hydro projects, a CEA official added.