Context

India has ambitious plans for energy growth, including aims to generate 57% of electricity capacity from non-fossil fuels by 2027. The country’s clean energy sector is expanding, as it acts to reduce reliance on coal-fired power stations. While the capacity for renewable energy production in India is increasing, significant capital from domestic and overseas private sectors will be required in order to reach its targets.

Arunachal Pradesh is a mountainous region in north-eastern India where rural communities have minimum facilities, with limited or no access to basic utilities including electricity. While the region holds tremendous potential for small run-of-river hydro projects, it remains underdeveloped as there has been little interest from private sector players due to accessibility and bankability challenges.

Through the pioneering Pareng and Keyi Hydro Power projects, InfraCo Asia aims to demonstrate the commercial viability of providing clean energy as an independent power producer, and thus catalyse greater private sector participation in the provision of basic infrastructure. InfraCo Asia’s role supporting development in India’s renewable energy sector will help to establish a world-class approach to the execution and implementation of hydro power projects.

The Project

Implementation of the Keyi (23 MW) and Pareng (14.5 MW) Run-of-River Hydro Power projects will support social and economic development by strengthening the electricity supply in north-eastern India. The small run-of-river hydro plants will generate clean power for delivery to the regional grid.

These projects fall under the renewable energy incentives under India’s Small Hydro Power Policy. Both projects have been planned as a run-of-river plant and have been selected on the basis that there are no submergence issues and affects no other projects or catchments.

The projects are easily accessible, have the support of the local population and have no major environmental issues. In addition, they have remarkably favourable geological conditions for the region and are relatively simple projects with no unusual features. Both projects are close to transmission heads but lines need to be laid down.

Our Impact

Impact on people: The hydro power plant will contribute to alleviate electricity generation shortfalls in India which typically results in an intermittent and therefore unreliable energy supply to customers

Market transformation: By serving as a reference project, the PPA model developed by the project sponsor, can help attract international investors and lenders to other projects.