Loktak Downstream runs into PPA wall
Source: The Sangai Express
Imphal, February 11 2018:
Loktak Downstream Project which would have three power generating units and total installed capacity of 66 MW has been further delayed as the project's implementing agency NHPC and the State Government have not yet signed the power purchase agreement (PPA).
Power tariff of Loktak Downstream Project would be around Rs 6.17 per unit which is comparatively high and this is the main reason for the inability of the State Government and NHPC to sign PPA, informed a source.
Nonetheless, NHPC has already asked the State Government to sign the PPA as soon as possible but the State has been contending that the power tariff is higher than admissible.
The estimated cost of Loktak Downstream Project calculated at the rates of 2015 is around Rs 12050 crore.
Notably, Forest and Environmental clearance has been already given for the project.
NHPC Chairman KN Singh came to Imphal on April 6 last year.
He called on the Chief Minister, the Power Minister and the Chief Secretary the next day and urged them to sign the PPA.
During his meeting with the Chief Secretary, KN Singh urged the State Government to complete the process of paying compensation to the owners of 211.5 acres of land which would be affected by the project.
He also gave a written representation to the Chief Minister on April 8 seeking completion of the road construction work from Rengpang to the project site as early as possible.
Even the process for selection of contractors had begun.
On the ground that the power tariff would be too high when the project is funded by the Government of India, an alternative of seeking the necessary fund from the Japan International Corporation Agency (JICA) has been explored in the meantime.
If the project is funded by JICA whose interest is very low, the power tariff can be reduced to Rs 5 per unit, said the source.
NHPC too agreed that the power tariff can be reduced if loan is obtained from JICA for the Loktak Downstream Project.
As such, the Government of India has written to the Government of Japan to give loan for taking up the project.
Even though NHPC had taken up a number of steps to take up the project, they must now wait for JICA to sanction the necessary amount, added the source.