Set back to Himachal Govt: HC stays amendments in hydropower policy
The Himachal Pradesh Government got a major setback today as the Himachal Pradesh High Court stayed the decision of the Congress government taken in the month of August this year to amend the hydropower policy imposing more royalty on commissioning of power project in the form of free power.
The division bench of Chief Justice MS Ramachandra Rao and Justice Joytsna Rewal Dua passed an order against the decision of the Sukhvinder Singh Sukhu Government to amend the hydropower policy.
The counsel of JSW Energy and Senior counsel P Chidambaram demanded that the action of the state government is a breach of the pre-power purchase agreement should be quashed and the court should issue status quo ante on the matter which was allowed by the high court on the very first hearing on this matter on Thursday.
The counsel of the state and Advocate General Anup Rattan opposed the petition and pleaded with the court to not grant a stay on the decision of the state. He said that decision taken by the state is within its domain being the matter of policy.
However, the court allowed the plea of the petitioners and fixed the next hearing on December 6, 2023. The respondent state also stated that they did not supply a copy of the petition by the respondent so far. The respondent responded in the court that it had already mailed the copy of the petition while filing the Writ petition against the Government earlier in this hearing.
It is worthwhile to mention that on August 22, 2023, the council of ministers under the chairmenship of Chief Minister Sukhvinder Singh Sukhu decided to amend the Swaran Jayanti Energy Policy, in which it decided to amend the power policy and also go for a new MoU to be signed with the developers for a period of 45 years which earlier reduced to 40 yrs by the previous BJP rule.
It is worthwhile to mention here that the Karcham Wangtoo plant located on the mighty Satluj River in Kinnuar district was commissioned on September 13 2011 and Baspa on June 6, 2013, would have to pay the increased 20 percent free power royalty for the next 18 yrs and and 30 pc free power reality after 30 yrs till firm have to handed over the plant after Sep 13, 2051 on June 6, 2053 to state.
The COMs also have amended the clause of royalty to be charged 15 percent for the first 12 years, 20 percent for the next 18 years, and 30 percent for the remaining 10-year period. After 40 years project should be reverted back to the State Government free of cost and free from all encumbrances and liabilities. However, the royalty payable to the State for an extended period would not be less than 50 percent.
The COMSs also withdraw the relaxation given for staggered free power royalty in favor of SJVNL and NHPC for 210 MW Luhri Stage-I, 66 MW Dhaulasidh, 382 MW Sunni Dam, and 500 MW Dugar Hydro Electric Projects with immediate effect. The Cabinet decided to rationalize the tariff of water cess to be charged from the Hydel Power Projects.
Agreed by the cabinet decision the JSW Energy operating 1300 mw Karchham Wangto power project on the Satluj River and 300 mw Baspa power project on the Baspa River tributories of the Satluj in Kinnuar district have moved in the High Court on October 6 challenging the amendment in the power policy.
The state Government after a massive loss during the Monsoon and especially from August 18-22 has withdrawn the relaxation given by the former BJP
the developer to provide royalty in the shape of free power on the Project in the state in lieu of surrender of a potential site.
In the name of ease of doing business Jai Ram Thakur’s government in 2018 amended the power policy by charging 12 percent deliverable free power from the commissioned project for the period and extending up to 12 years from the date of Scheduled Commercial Operation. The Project was allowed to provide 18 percent free p; power to Himachal for the period of the next 18 years and at the rate of 30 percent of the Deliverable Energy for the balance agreement period beyond 30 years.
To attract new power developers and stop the flight of power producers from the state BJP rule had also extended the operation period from the scheduled 40 years to 45 years from the date of scheduled Commercial Operation. The quantum to be deferred should be recovered during the balance agreement period in a uniform percentage rate for all the ongoing private sector projects that are under construction and at various stages of clearance.
BJP govt also decided that Free Power Royalty for all the new hydro projects to be allotted in the future under the Private Sector shall be levied as per the provisions contained in the National Hydro Power Policy i.e. levy of royalty in the shape of Free Power would be at a uniform rate of 12 percent for the entire agreement period. Before the allotment of a power project, new power developers are liable to sign revised Pre Implementation Agreements, Implementation Agreements, and Supplementary Implementation Agreements as the case may be.
The JSW and other public sector firms filling separate petitions before the HP high court seeking the restoring of the old power policy and opposed the levying of water cess on the generation of power terming it in violation of Pre-implementation and power purchase agreements signed with them by the previous Governments in the state.
