Major breakthrough in Rs 26,000-crore Kamala hydroelectric project with PIB nod: 10 things to know

The Public Infrastructure Board (PIB) has cleared a 1,720 MW hydropower project on Kamala River, located in Arunachal Pradesh's Kamle district. The project -- set to be completed over the next eight years -- will generate approximately 6,869.92 million units (MU) of green energy annually. NHPC will hold a 74 per cent equity stake in the project while the remaining 26 per cent equity will be with the state government.

The project is estimated to be worth more than Rs 26,000 crore.

Here are 10 things to know about this development:

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• What is the Kamala project? It is a storage-based scheme with a flood moderation component, proposed on the Kamala River -- a major tributary of the Subansiri River -- located in Kamle, Kra Daadi and Kurung Kumey districts of the state.
• Which model will the project be built on? The project will be developed on a build-own-operate-transfer (BOOT) basis, according to a source.
• "The completion cost of the project is estimated at Rs 26,069.50 crore, including interest during construction (IDC) and financing charges of Rs 4,815.64 crore," said a source close to development.
• The project, said the source, is proposed to be financed with a debt-equity ratio of 70:30, supported by the central government grants for enabling infrastructure (Rs 1,340 crore) and a flood moderation component worth Rs 4,744 crore along with a 100 per cent SGST reimbursement by the state government.
• Project Tariff: Considering these aspects, the levelized tariff of the project is Rs 5.97 per unit.

• The project involves the construction of a 216-metres high concrete gravity dam and an underground powerhouse with a scheduled completion period of eight years.
• The project will generate 6,869.92 MU of green energy annually on completion, thereby contributing to the Government of India’s energy transition initiatives and its Net Zero target by 2070.
• The project also envisaged providing flood relief in the Brahmaputra valley.
• Along with this, the Power Ministry approves Rs 3,000 crore for strengthening the lab facility of power equipment.
• Another source said that the Power Ministry has also approved a new centre power research institute in Haryana.

Here are answers to some frequently asked questions (FAQs) about the project:

Which authority has approved the project?

The project has been cleared by the Public Infrastructure Board.

What is the estimated cost of the project?

The total completion cost of the mega hydroelectric is Rs 26,069.5 crore.

What model will the project be developed under?

The project will be developed on a build-own-operate-transfer (BOOT) basis.

What is the centre-state equity structure?

NHPC will hold a 74 per cent equity stake in the project. The remaining 26 per cent interest will be with the Arunachal Pradesh government.

How will the project be financed?

The Kamala project will follow a debt-equity ratio of 70:30, aided by central government grants for enabling infrastructure worth Rs 1,340 crore.