Centre to create power behemoth by merging hydroelectric firms

In a massive restructuring of state-run power companies, the government plans to amalgamate all hydroelectric producers and transfer their thermal projects to the National Thermal Power Corp, already the country's biggest power producer, to create strong companies that can take on the rapidly growing private conglomerates.

The exercise aims to merge all four central hydropower companies.

The proposed merger of four central hydro power utilities - the National Hydroelectric Power Corp (NHPC), Tehri Hydro Development Corp, Satluj Jal Vidyut Nigam and North Eastern Electric Power Corp - into a single entity that will see NHPC taking the lead role.

The NHPC's chairman and managing director has been made the nodal officer to pilot the proposed merger, which seeks to bring in greater synergy and operational efficiency.

The combined installed capacities of these four hydropower utilities is currently at 11,000 MW, constituting 30 per cent of the total hydropower capacity in the country. They are adding another 17,558 MW.

Although hydropower generation did not grow over the past decade, it is 17 per cent of the total power basket. Land acquisition and rehabilitation and resettlement problems have stalled projects in the sector.

Power minister Piyush Goyal reportedly first discussed the proposal at a meeting with the public sector undertakings on 2 July, and gave SBI Caps the mandate to work out a plan.

Both NTPC and NHPC welcomed the proposal during the meeting.

Welcoming the move, the All India Power Engineers Federation said states should now replicate the idea to iron out administrative and technical problems in the energy sector.

''We will soon write to Uttar Pradesh chief minister Akhilesh Yadav to consider unifying the different power utilities in the state under a single entity on the model mooted by the centre,'' said Shailendra Dubey, chairman, All India Power Engineers Federation.