KERALA STATE HYDROPOWER POLICIES - CRITICAL ANALYSIS

Introduction 

Kerala is in the southern part of India. “Kera” in the native Malayalam language means coconut and Kerala are abundant with Coconut trees, that is the reason for the name. The state with an area of 38,863 km2 and population of 34.8 million is blessed with magnificent nature, the evergreen forests with Mecaques, Langurs and Thrushes, the vast expanses of spices, tea and coffee and above all, the monsoon seasons (average of 3000mm rainfall annually) and 41 rivers which runs from western Ghats to the Arabian sea (See Figure 3) are the treasures of the state (Jayapalan & Ganesh, 2019). See Figure 1

Figure 1 Map of Kerala State, Source: mapofindia.com

Hydropower is the main source of electrical energy in Kerala due to a large number of rivers. The first hydropower project was established in 1940 at Pallivasal with an initial installed capacity of 13.5MW (KSEBL, 2019). The Kerala State Electricity Board Ltd (KSEBL) was formed in August 1957. They are handling the major power generating projects in Kerala, At present, 16 major Hydropower stations, 15 Small Hydel stations, 2 Thermal stations and one wind farm with a total installed capacity of 2186.14 MW are operating under KSEBL (KSEBL, 2019). The major players in the state power sector are,

1. KSEBL – State Transmission Utility and Distribution Licensee for the entire state, owning Generator assets in Kerala

2. Electrical Inspectorate – Statutory authority on electrical safety and standards

3. ANERT –Agency for New and Renewable Energy Research and Technology

4. EMC – State Designated Agency under Energy Conservation Act, 2001

5. Kerala State Power and Infrastructure Finance Corporation Ltd. 

Currently, Kerala has a total installed capacity of 2823MW, out of which 2118MW is from hydroelectric projects (KSEBL, 2019). The peak demand of the state was 4004MW as recorded on 27-04-2016 and peak demand estimated for 2021 – 22 is 5343MW. The state had to depend on other states’ electricity generation for meeting the demand, currently, allocations from Central Generating Stations (CGS) comes to1607MW (EMC, 2019), which is completely based on fossil fuels. Kerala was an energy surplus state in the 1980s, which was completely produced from inhouse hydroelectric projects and interestingly the state was completely meeting needs with green energy well before the Kyoto Protocol (Jayapalan & Ganesh, 2019). The requirement of new hydro projects is clear from the present shortage, considering only 7 rivers have hydro projects and there are plenty more options (Azeez, et al., 1999). The KSEBL has proposed several projects but, many of them were not cleared by the environmental authorities and there were several protests from the local public. This essay critically analyses the hydropower sector of Kerala state. 

Critical analysis of Hydropower policies in Kerala state 

During the early ’90s, the central government started the policy initiatives in the national energy sector. It was against this background, in 1998, that the Kerala state also formulated its energy policy. This policy has helped the state through the power crisis by addition of 1089MW capacity during 1996 – 2001. (EMC, 2019). The later government had formulated the renewable energy policies like a small hydro policy 2012 and other policies for wind and solar. The national Electricity Act, 2003 strongly pushed the privatisation of State Electricity boards all over India. But Kerala state government stayed with the vision of Energy Policy 1998, keeping the KSEB (Kerala State Electricity Board) as a single entity in the public sector (Ministry of Law and Justice, 2003). On the scenario of changes in the energy sector, the new power policy was published in 2019 by EMC (Energy Management Centre). Kerala’s major energy projects were constructed in the 1970s and ’80s and were hydroelectric projects. The state was in energy surplus until 1987 (State Planning Board, 1997). Essentially there were no energy policies during the phase of major hydroelectric project installation and this could have caused several problems. 

Kerala state government’s policies before the Energy Policy 1998 have miscalculated the economics of power generation. All hydropower projects were in the forest region of the Western Ghats, which is ‘owned’ by the state government and hydroelectric dams were implemented by the state agency (KSEB). So, they have not considered the cost involved in the loss of forest and resources due to submergence. KSEBL considered the hydropower as ‘cheap’ because they assumed hydropower is free of cost. The social and ecological cost were written of considering as indirect cost (George, 2000). The following quotes exactly portray the thinking of government and KSEB;

“Availability of cheap power is an essential precondition for rapid industrialisation. Power generation in Kerala is perhaps the cheapest compared to the other states in India. Gifted with a large number of rivers the state is naturally placed in an enviable position in respect of power development. Due importance was therefore given for generation of hydel power during the two decades of planning in the state.…” (State Planning Board, 1975)

Accordingly, power was supplied to neighbouring states and big industries for low rates compared to the domestic sector. For example, the consumption of power by high voltage required industries was of 60.65% in 1970, while revenue generated was the lowest of 27.3%. Comparatively, domestic consumption was only 3.43% in the same year, but the revenue collected was 15.33%. By1977, the higher power consuming industries energy consumption went up to 63.91%, when the domestic consumption was only 10.43% when revenue collected from this sector was 35.5% and 18.23% respectively. (George, 2000), (State Planning Board, 1975). So from the findings of George (2000) it is evident that Kerala hydroelectricity was not sold at a price which considered the complete cost of production.

The environmental impacts of a hydroelectric project are to be considered while proposing a project and cost-benefit analysis should be done. Studies show that the hydroelectric projects proposed lacks in adding the environmental cost to the total cost. The Environmental Impact Assessment study done by Azeez et al (1999) on the Puyankutty project in Kerala, has found that the project proposal of 8200 million never considered the environmental costs. The Puyankutty project was designed to inundate 2500 hectares of prime forest and the river basin, Azeez, et al. (1999) concluded that “the benefit of the project is no way commensurate with the loss of ecological values of the area”. Thus the Puyankutty project was shelved, there are several other big projects which faced the environmental objections and protests like Silent valley project and Athirapilly project. In contrast to the Azeez, et al. (1999) findings Santhakumar & Chakraborty (2003) has done a cost-benefit analysis of the same Puyankutty project and point out the importance of considering total cost (direct plus environmental costs) of the alternative method of energy production, in the scenario of Kerala purchasing electricity from other sources. Santhakumar & Chakraborty (2003) have provided insights on the trade-off involved in the choice of the project, which at a different discount rate shows net positive benefits and sometimes net negative benefits. This study illustrates the importance of public debates and political process leading to the viability of the project because cost and benefits can be weighted based on priorities of the people.

There are several environmental studies like the Western Ghats Ecology Panel (WGEEP) Report, (often referred to as ‘Gadgil Report’), which have considered the entire Western Ghats as an “Ecologically Significant Area” and have classified it into three zones ( Figure 2). According to the Report (WGEEP, 2010) larger dams are only permitted in Zone 3 if they have a cumulative Environment Impact Assessment and in Zone 2, hydro projects between 10- 25 MW (up to 10 m height) are allowed. Only small scale, micro and pico hydropower systems are permitted in Zone 1 which are people owned and managed and they should be off-grid. WGEEP proposes that Environmental clearance should not be given to the Athirappilly project because it is in ESZ 1. (KSBB, 2011). There are several other reports also published after the Gadgil report, Kasturirangan report and Oommen V Oommen study are followed because Gadgil report was criticised. The major criticism faced by Gadgil Committee report was that it was more environment-friendly and not in tune with the ground realities. Gadgil suggested complete eco-sensitive cover for the Western Ghats which hamper different states on energy and development fronts and it was against dams in the Western Ghats (George, 2018). Gadgil report laid too much importance to the environment, Kasturirangan report was biassed towards development. Kasturi Rangan report was criticized by many as that it provided loopholes for mining, which if allowed would turn detrimental to the environment, in long-term will affect development too (George, 2018)

 Figure 2 Environmental Sensitive Zones and Protected areas of Kerala according to WGEEP Report

The environmental laws are for the protection and wellbeing of society. Rejection of a hydroelectric project due to environmental concerns and depending on the thermal energy to meet the requirement is a blunder. Kerala's several projects have been objected by environmental organisations. Jayapalan & Ganesh (2019) have criticised environmentalists in Kerala and labelled them as the opposer of large scale projects without any valid reasons. They say that shelving of the Silent Valley and Pooyamkutty Projects have pushed the 100% green energy status of Kerala to thermal mix energy state with a significant shortage of energy. This paper also proposed to educate the minds of the public with the environmental concerns of the hydro projects and the greenhouse gas emissions caused by the purchase of energy from thermal power plants, also the higher cost paid for that. Gadgil and Kasturirangan report have effected farmers and those who live in high altitude regions and poor forest inhabitants or indigenous people (Adivasi) (Thomas, 2016). Environmental fundamentalists concentrate on urban areas, and Thomas (2016), says that they try to impose fundamentalist view on the village people, the article tries to justify the arguments and demands by farmers in the Kerala region, based on the Gadgil report, they fear that they will lose livelihood if it is recommendations are implemented. This example suggests that it is very difficult to go with development and environment concerns, in many ways one will have to compromise for others.

Dams are the major element of a hydroelectric project. Dams are considered as the major tool for flood mitigation (Lempérière, 2017) and dams are also considered as “Water bombs” (White, 2019). There are 53 Dams (See Figure 3 ) in Kerala (ENVIS, 2020), of which 57% are of KSEBL generating electricity and rest is of the irrigation department (Liji & K, 2018). Kerala was drastically flooded from 14th Aug to 19th Aug 2018, which resulted in inundating 13 out of 14 districts in the state. 433 people died, and 5.4 million people were affected (UNDP, 2018). According to the Central Water Commission (CWC) Report “dams in Kerala neither added to the flood nor helped in reduction of the flood”. The CWC analysis(CWC, 2018) says that “As per IMD (India Meteorological Department) data, Kerala received 2,346.6 millimetres of rainfall from June 1, 2018, to August 19, 2018, in contrast to an expected 1649.5 mm of rainfall. This rainfall was about 42 per cent above the normal. During August 1, 2018, to August 19, 2018, total rainfall in Kerala was about 758.6 mm against the normal of 287.6 mm, which was 164 per cent above normal.” In contradiction to this report, studies are showing that poor dam management is the cause of the flood. Amicus curiae Jacob P Alex's 49-page report stated that the simultaneous opening of many dams seemed to have aggravated the disaster. Reuters (2018) has learned the two largest reservoirs in Kerala - Idukki and Idamalayar - have been operating for years without any emergency action plans. The existing policy fails to accommodate dam management effectively. 

Figure 3 Rivers and Dams in Kerala (Reuters, 2018)

Kerala state’s latest energy policies are the Kerala Small Hydropower Policy 2012 and Kerala Power Policy 2019. These policies were put in place for harnessing the green energy potential and to reduce the importation of power, in 2015 – 2016, power importation was 2.4 times the state’s own generation (State Planning Board, 2018). In 2012 the Kerala government brought forward the policy for hydropower projects not greater than 24MW. This policy was targeted to tap the 700MW small hydropower potential by including private participation (Prakash & Alwin, 2018). The policy guidelines were perfectly suiting the environmental criteria and were in accordance with the Gadgil report, so that environmental clearance was not a problem. But critics have argued that this policy is a trick to avoid environment clearance. According to the environmental laws, hydropower projects greater than 25MW only need the Environment Impact Assessment and by this policy, projects can easily evade the environment clearance. Also, multiple small hydropower projects could be constructed in a single river and it could create cumulative environmental impacts downstream (Goyal, 2015). Interestingly, only 10 new small hydro projects have come up after 2012 and out of that only 4 are privately owned (Prakash & Alwin, 2018). This number shows that private developers are not interested in SHP projects, Goyal (2015) says that area of concern for developers is certain provisions in the build-own-operate-transfer (BOOT) policy. 30 years from the date of allotment of the project, the developer can construct, own and operate the project before transferring it to the state government on an as-is-where-is basis. Under the current system, developers have only about 24 years to reap profits from the project as six years are usually spent in construction and the securing statutory approvals. This BOOT period granted in Kerala is less compared to the period of 35 years applicable in states like Uttarakhand and Himachal Pradesh (Goyal, 2015). This policy has not met the government target and fails to meet energy needs. It is visible that the government have diverted from the idea of Hydropower to other energy sources, which is clear in the latest “Kerala Power Policy 2019”

The “Kerala Power Policy 2019” is completely aligned with the national policy. India has committed to reducing the emissions by 35% by 2035 on “COP21” on climate change at Paris. To achieve that the National Action Plan on Climate Change (NAPCC) has a target of 175GW from renewable energy sources before 2022. For Kerala, The NAPCC has put forward a target of 1970MW from renewable energy sources by 2022, out of which 1870MW is to be from “Solar” (EMC, 2019). Solar energy has been given primary importance in the policy and hydropower projects are suggested as storage hydro plants so that it can contribute to the grid while solar energy is not available. Other mentions of the hydropower projects in the policy is the completion of stranded hydro projects and increasing the capacity of existing projects. So, clearly, this policy is behind the global trend of solar energy and avoids the hydropower potential of Kerala.  

Conclusion 

This essay critical analysed the hydroelectric sector and the policies in the Kerala state, India. Major hydroelectric projects in the state were established in the 1970s and ’80s and were able to meet the needs of the whole state with that. Kerala was energy surplus till 1987 and all energy was a green energy source, even before the world thinks about renewable energy. However, it was not intentional and was due to the terrain and number of river system available made more possibilities for hydropower stations. Proper energy policies were published in the late ’90s and it shows that there were no policies while the establishment of hydropower projects and it has caused several problems.

Several studies say that KSEBL considered the hydropower as ‘cheap’ because they assumed hydropower is free of cost they have not considered the cost involved in the loss of forest and resources due to submergence. KSEBL was selling the surplus energy for a cheaper rate to other states which shows the lack of good policies at that time. Another problem due to lack of policies was the avoiding of environment impact assessment and the environmental cost involved in constructing a hydropower project. But later on, it is found that every hydropower project is shelved due to the concern from environmentalist and public, the government failed to analyse the pros and cons of a hydro project. The state, later on, was pushed into energy deficit and was buying energy from neighbouring states who use coal as an energy source, but the government never had the policy to compare the benefit of hydropower with coal and failed to educate the public regarding the cost-benefit of each technology. it is very difficult to go with development and environment concerns; in many ways, one will have to compromise for others.

There are several dams in Kerala part of hydroelectric projects and other dams for irrigation uses. Dams are a threat and it is called “water bombs” because it could break and without proper dam, management flood can also occur. Dam management means the monitoring of dam water levels and clearing the dam water before the rainy season to accommodate the monsoon floodwater. There were no policies to monitor the dam water levels and few studies have pointed out that it has contributed towards the major flood event happened in 2018. So policies for dam management should also include inside the energy policies.

The new policies have failed to accommodate new hydropower projects in the state. The “Kerala Small Hydropower Policy 2012” and “Kerala Power Policy 2019” failed to attract more hydropower stations and did not meet the required number to cover the current energy demand. It is also found that the new trend of Solar energy has made the government fall for it. The latest policy “Kerala Power Policy 2019” has put forward a target of 1970MW from renewable energy sources by 2022, out of which 1870MW is to be from “Solar”. But solar energy is available only in the day time and it is not effective during monsoon season also. Solar energy cannot meet the peak energy demand during night-time unless energy is stored in any form. Thus, the importance of hydroelectric power comes forward. As Kerala has the huge potential for hydroelectric projects the government should consider it and amend the policies for that. Hydropower projects are not always against the environment and it is comparatively better than the carbon-intensive energy sources which cause global warming and climate change.

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