India : Himachal Pradesh Clean Energy Transmission Investment Program - Tranche 2

Energy / Electricity transmission and distribution

The Project proposed for financing under the requested PFR consists of:

1.New Transmission System Assets

A.Transmission Line Construction

i. 66 kV D/C Line from 66 kV Switching station at Urni to Wangtoo Sub station.

ii.220 kV Line from 33/220 kV Lahal sub station up to 220 kV Yard of Budhil HEP.

iii.220 kV D/C (Twin MOOSE) Transmission Line from Sunda to Hatkoti.

iv. 132 kV D/C (PANTHER) Transmission Line from Kangra to Dehra.

v.220 kV D/C line (Twin MOOSE) from Charor to 400/220 kV Banala sub station of PGCIL.

B.Construction of Sub Stations

i.66 kV Switching station at Urni.

ii.33/220/400 kV, 50/63 MVA P.S at Lahal.

iii.132/220 kV, 2x100 MVA Pooling Station at Sunda.

iv.132/220 kV, 1x80/100 MVA Sub Station at Charor.

The Indian power sector has a history of steadily increasing demand for, and chronic shortages of electricity. An adequate power supply contributes to poverty alleviation, yet over 30% of India's population lack access to electricity. Continued shortages significantly constrain commercial and industrial activity and reduce growth. Businesses and manufacturers must utilize more expensive back-up power supplies, often diesel fuel-based, which increase their costs and undercut competitiveness. Insufficient domestic fuel resources and rising international coal and oil prices threaten India's already fragile energy security, such that maximizing, clean indigenous energy sources is a government priority.

Himachal Pradesh is home to about one fourth of India's hydropower potential, and maximizing this potential is articulated in the Hydropower Policy, 2007 of the Government of Himachal Pradesh (GOHP) and in their power sector roadmap, which targets its comparative advantage in hydropower with the goal to become the 'hydropower state of the country. Hydropower will benefit electricity consumers of Himachal Pradesh and throughout northern India as excess generated power flows to India's national grid. The primary alternative, namely coal-fired power generation and its associated coal mining and coal transport, have considerable adverse impacts on the environment as well as climate change, including substantial emissions of CO2 and of suspended particulate matter.

The state's power sector road map encourages investment in hydropower generationthe majority of which are run-of-river typeand articulates that Himachal Pradesh must build out its electric transmission infrastructure so that the additional hydropower can be efficiently transmitted within and outside the state. As Himachal Pradesh is one of the few states in India with 100% electrification at the village level, additional hydropower capacity will not just serve the state's growing demand, but will serve the national grid through interstate power flows. As a subset of the overall sector road map, and with support from the Asian Development Bank (ADB), HPPTCL has prepared a power system master plan to articulate a transmission network expansion plan for Himachal Pradesh. This plan, endorsed by India's Central Electricity Authority (CEA), provides a sound basis for investment in transmission facilities, and is expected to engender confidence among existing and potential private hydropower developers that sufficient transmission capacity will be available to evacuate power from hydropower facilities to markets outside of Himachal Pradesh. The investment program thus consists of transmission system investments, and a capacity development program for HPPTCL as the state transmission utility.

Increased electricity transmission in Himachal Pradesh.

Improved capacity of HPPTCL to transmit electricity from hydropower generation sources within and outside of Himachal Pradesh.

New Transmission system assets are operational.

Enterprise resource planning (ERP) system, phase II and additional IT hardware installed in HPPTCL corporate facilities and are operational.

Capacity of HPPTCL personnel on project management, and transmission utility operations improved.

(i) Work for 10-TL (66 kV Urni to Wangtoo transmission line) signed on 11 March 2015. It has achieved overall physical progress of around 75%.

(ii) Work for 11-TL (220 kV Lahal to Budhil transmission line) signed on 9 May 2015 and all works related to construction of transmission line has been completed.

(iii) Work for 12-TL (220 kV Charor to Banala transmission line) signed on 7 April 2015. All works related to construction of transmission line has been completed.

(iv) Work of 33/132, 2x25/31.5 MVA GIS substation at Chambi (Shahpur) was shifted to Tranche 1.

(v) Work of 132 Kv line from Kangra to Dera (20-TL) is completed.

(vi) Work for 15-TL (220 kV Sunda to Hatkoti transmission line) signed on 11 August 2015. It has achieved overall physical progress of around 95%.

(vii) Work for 7-SS (66 kV Urni switching station) signed on 11 July 2014. All works related to substation has been completed.

(viii) Work for 9-SS (400 kV GIS Lahal substation) signed on 4 February 2015. All works related to substation has been completed.

(ix) Contract for 28-SS (220 kV GIS Sunda substation) has been signed on 3 May 2018. Engineering Drawings and Vendor Approval under process and It has achieved overall physical progress of around 35%.

(x) Contract for 27-SS (220 kV GIS Charor substation) has been signed on 17 April 2018. Engineering Drawings and Vendor Approval under process and It has achieved overall physical progress of around 22%.

(x)i Contract for revised bid as 27-SS has been signed on 17 April 2018. Engineering Drawings and Vendor Approval under process. It has achieved overall physical progress of around 12%.

(xii) Training program is under progress.