MoP issues draft guidelines to promote development of PSPs in the country

The Ministry of Power (MoP) has issued draft guidelines to promote development of pumped storage projects (PSPs) in the country.

As per the draft guideline, allotment of project sites by state governments to developers may be done on nomination basis, or through competitive bidding, or through tariff-based competitive bidding. Developers shall begin construction within a period of two years from the date of allotment of the project, failing which, allotment of the project site will be cancelled by the state. Further, in order to ensure the viability of the PSPs, states shall ensure that no upfront premium is charged for project allocation. Additionally, there will be no requirement of creation of a local area development fund. PSPs are energy storage schemes and do not produce energy. They are net consumers of energy, and hence, the PSPs would be kept out of the liability of free power. To initiate and accelerate the pace of establishment, PSPs may be supported through concessional climate finance. The comments and suggestions have been sought on the draft guidelines within 15 days.

Click here to read the draft guideline