Small Hydro Projects, Reviced Guidelines  
Government of Kerala
Department of Power

Kerala, God's Own Country, by virtue of its High abundant Natural resources and high infrastructure facilities like roads, communication, school and hospitals etc. apart from socio-cultural and economic uniqueness and quality of life of its people, has decided to allow greater private investment in setting up Power Plants from Hydel sources to meet its growing demand for Power.

Hydro Potential


Kerala is abundant with natural waterfalls and streams. So far only 40% hydro potential of the State has been tapped. Power being the life blood of economic development of any State, hydro potential available in the State provides unique opportunity for investors to set up hydro plants and become part of economic development of the State.

Strengths of Kerala

  • UNIDO Regional Centre for SHP at Energy Management Centre-Kerala
  • Attractive Industrial Policy
  • Advisory Services
  • Availability of High Skilled Manpower
  • Single Window for Clearance of Project
  • Project Counselling
  • Proactive and Investment friendly atmosphere
  • New Labour Reforms
  • State Electricity Regulatory Commission set up
  • Power Reforms well on the way.
  • High Hydro Potential to be explored.

Government of Kerala’s New Initiatives on Promotion of SHPs

As part of Government of Kerala Policy to allow greater participation of Private investors in setting up Small and Mini Hydro Projects,
Government of Kerala has announced revised guidelines for allotment of Small / Mini Hydel to Captive Producers / Independent Power Producers.

Main Highlights of Captive Policy

Eligibility: All HT/ EHT industrial consumers of K. S. E. B. with demand load 0.5 MW and above are eligible to apply for Hydel Captive Power Projects.

Capacity Ceiling: Hydro Electric Project/Projects allotted to a captive unit will be such that the total annual generation potential from the project(s) will not exceed the annual requirement of the company based on the past three years consumption plus the capacity addition expected to be added within the next five years from the date of allotment.

Basis of Allotment will be on competitive bidding for individual projects. Bidder will quote his upfront premium projectwise over a threshold premium/MW. Criteria for selection shall be the highest premium bid rate thro’ RFQ & RFP Route.

BOOT Period: 30 years from date of allotment.

Wheeling Charges and T&D losses: 15% of the energy supplied to nearest KSEB grid.

Water Cess: No Water Cess will be levied by Government for the water utilised for power generation.

Relief on Demand Charges: Relief in maximum demand charges to the extent of powergenerated by Captive Producer into the KSEB Grid as per the existing norms.

Evacuation facility and Grid Interface: Construction and Maintenance of transmission facility up to KSEB’s Grid shall be Developers responsibility.

Main Highlights IPP Policy

Eligibility: Any Individual/Company/Partnership firm/Joint Venture is eligible for bidding
as IPP for individual or group of Projects.

Maximum Capacity: for a single Project limited to 25MW

BOOT Period: 30 years from date of allotment.

Selection Criteria: Bidder shall submit for RFQ and RFP in prescribed format. Proposals of short listed qualified bidders are only considered for allotment based on lowest bid rate for the sale of electricity for the entire BOOT period.

PPA: Successful bidder has to enter into Power Purchase Agreement with KSEB.

Evacuation facility and Grid Interface: Construction and Maintenance of transmission facility up to KSEB’s Grid shall be Developers responsibility.

Water Cess: No Water Cess will be levied by Government for the water utilised for generation.

Mode of Selection and Award of Schemes:

  • Notice Inviting Tender Jan 2003
  • Submission of RFQ Mar 2003
  • Opening RFQ & Prequalification Mar 2003
  • Pre-Bid Meeting May 2003
  • Opening of RFP Aug 2003

Allotment of Projects Sep 2003

List of SHP schemes offered.

Revised SHP Guidelines (detailed - dt. 16.01.2003)

Further Information:

Government of Kerala invites the prospective investors to contact the Small Hydro Promotion Cell,

Energy Management Centre under Department of Power, Government of Kerala in the following address.

Small Hydro Promotion Cell
Power Department
Energy Management Centre-Kerala
Karamana P. O, Thiruvananthapuram 695002
Kerala, INDIA.

Tel : 91-471- 341598 /345597 Fax: 91-471-345587
Energy Management Centre-Kerala
ISO 14001 certified Organisation
Total Consultancy for SHPs, Environmental Impact Assessment (EIA) studies
Energy Audits & training, Energy Conservation Projects for UNIDO.

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