BHOPAL: The Madhya Pradesh Cabinet on Tuesday cleared a policy to encourage minor hydel power projects in the State.

Briefing newspersons here, Energy and Public Works Department Minister Kailash Vijayvargiya said that all the State Government departments concerned, that would be offering special facilities under the new policy, have been instructed to issue gazette notifications within 30 days. He said minor hydel power generation units up to a capacity of 25 MW would be allowed under the new policy being introduced to encourage private sector participation in this vital sector.

Any industry, organisation or private unit would be eligible to establish and run these units on a build-own-operate-transfer (BOOT) basis for a maximum of 30 years, he said, adding that it would be mandatory to start work on these projects within 12 months of receiving Government permission.

The deadline would be 30 months for setting up a 5 MW project, 36 months for a 10 MW project and 40 months for a 25 MW project. After the expiry of the BOOT period, the ownership of these units would get transferred to the State Government at no cost. Thereafter the Government would have the option to invite tenders for maintenance and operation of these units for another five years.

Mr. Vijayvargiya told journalists that 5 per cent of power generated by the 5 MW units, 8 per cent of power generated by the 5 to 10 MW units and 10 per cent of power generated by the 10 to 25 MW units would be supplied free to the Government. The Government will be granting total exemption on water tariff for the 25 MW units. The State-owned power distribution company will buy power from these units at rates approved by the Madhya Pradesh Power Regulatory Authority and these units would also be allowed to sell power to third parties.

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