Document of The World Bank
Public Disclosure Authorized Report No: ICR00003326
IMPLEMENTATION COMPLETION AND RESULTS REPORT (IBRD-48700)
ON A
Public Disclosure Authorized LOAN
IN THE AMOUNT OF
US$ 400 MILLION (LOAN 4870-IN)
TO THE
SJVN Ltd.
Public Disclosure Authorized FOR
RAMPUR HYDROPOWER PROJECT
June 25, 2015
Energy and Extractives Global Practice Public Disclosure Authorized India Country Management Unit South Asia Region
CURRENCY EQUIVALENTS
Fiscal Year Annual Average Exchange Rate (Rs./US$) 2008-09 46.0 2009-10 47.4 2010-11 45.6 2011-12 47.9 2012-13 54.4 2013-14 60.5 2014-15 61.0
Currency Unit = India Rupees (Rs.)
FISCAL YEAR April 1 – March 31
ABBREVIATIONS AND ACRONYMS
BP Bank Procedures CAT Catchment Area Treatment CEA Central Electricity Authority CPS Country Partnership Strategy EMP Environmental Management Plan ERR Economic Rate of Return FY Financial Year GDP Gross Domestic Product GHG Greenhouse Gases GoHP Government of Himachal Pradesh GoI Government of India GW Giga Watts GWh Giga Watt Hour HP Himachal Pradesh HRT Head Race Tunnel IBRD International Bank of Reconstruction and Development ICR Implementation Completion Report IEGC India Electricity Grid Code ISR Implementation Status Report kWh Kilo Watt Hour LADA Local Area Development Authority M&E Monitoring and Evaluation MTR Mid-Term Review MW Mega Watts NEP (Indian) National Electricity Policy NJHP Nathpa Jhakri Hydropower Project
OHS Occupational Health and Safety OP Operational Policy PAD Project Appraisal Document PAF Project Affected Families PAP Project Affected Persons PDO Project Development Objectives RAP Resettlement Action Plan RHP Rampur Hydropower Project SCDP Sustainable Community Development Program SIL Specific Investment Loan SJVN SJVN Limited, formerly known as Satluj Jal Vidyut Nigam Limited TAP Tunneling Acceleration Plan
Vice President: Annette Dixon Country Director: Onno Ruhl Global Practice Senior Director: Anita Marangoly George Practice Manager: Julia Bucknall Project Team Leader: Rohit Mittal / Kwawu Mensan Gaba ICR Team Leader: Rikard Liden
INDIA Rampur Hydropower Project
CONTENTS
Data Sheet A. Basic Information B. Key Dates C. Ratings Summary D. Sector and Theme Codes E. Bank Staff F. Results Framework Analysis G. Ratings of Project Performance in ISRs H. Restructuring I. Disbursement Graph
1. Project Context, Development Objectives and Design ...... 1 2. Key Factors Affecting Implementation and Outcomes ...... 6 3. Assessment of Outcomes ...... 17 4. Assessment of Risk to Development Outcome ...... 21 5. Assessment of Bank and Borrower Performance ...... 22 6. Lessons Learned ...... 25 7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners ...... 28
Annex 1. Project Costs and Financing ...... 29 Annex 2. Outputs by Component ...... 30 Annex 3. Economic and Financial Analysis ...... 38 Annex 4. Bank Lending and Implementation Support/Supervision Processes ...... 41 Annex 5. Beneficiary Survey Results ...... 43 Annex 6. Environmental Management of the Rampur Hydropower Project ...... 54 Annex 7. Technical Characteristics of the Rampur Hydropower Project ...... 59 Annex 8. Lessons Learned from the Implementation of Nathpa Jhakri ...... 66 Annex 9. Summary of Borrower's ICR and/or Comments on Draft ICR ...... 70 Annex 10. List of Supporting Documents ...... 78
MAP IBRD 34258
A. Basic Information Rampur Hydropower Country: India Project Name: Project Project ID: P095114 L/C/TF Number(s): IBRD-48700 ICR Date: 06/24/2015 ICR Type: Core ICR SATLUJ JAL Lending Instrument: SIL Borrower: VIDYUT NIGAM LTD Original Total USD 400.00M Disbursed Amount: USD 400.00M Commitment: Revised Amount: USD 400.00M Environmental Category: A Implementing Agencies: SJVN Limited Cofinanciers and Other External Partners:
B. Key Dates Revised / Actual Process Date Process Original Date Date(s) Concept Review: 08/30/2005 Effectiveness: 04/14/2008 04/14/2008 Appraisal: 02/20/2007 Restructuring(s): 10/04/2011 Approval: 09/13/2007 Mid-term Review: 03/31/2010 11/14/2010 Closing: 03/31/2013 12/31/2014
C. Ratings Summary C.1 Performance Rating by ICR Outcomes: Satisfactory Risk to Development Outcome: Low or Negligible Bank Performance: Satisfactory Borrower Performance: Moderately Satisfactory
C.2 Detailed Ratings of Bank and Borrower Performance (by ICR) Bank Ratings Borrower Ratings Quality at Entry: Satisfactory Government: Moderately Satisfactory Implementing Quality of Supervision: Satisfactory Satisfactory Agency/Agencies: Overall Bank Overall Borrower Satisfactory Moderately Satisfactory Performance: Performance:
C.3 Quality at Entry and Implementation Performance Indicators Implementation QAG Assessments Indicators Rating Performance (if any) Potential Problem Quality at Entry Project at any time No None (QEA): (Yes/No): Problem Project at any Quality of Yes None time (Yes/No): Supervision (QSA): DO rating before Satisfactory Closing/Inactive status:
D. Sector and Theme Codes Original Actual Sector Code (as % of total Bank financing) Hydropower 100 100
Theme Code (as % of total Bank financing) Climate change 33 33 Infrastructure services for private sector development 67 67
E. Bank Staff Positions At ICR At Approval Vice President: Annette Dixon Praful C. Patel Country Director: Onno Ruhl Isabel M. Guerrero Practice Julia Bucknall Salman Zaheer Manager/Manager: Rohit Mittal/ Kwawu Mensan Sunil Kumar Khosla/ Judith K. Project Team Leader: Gaba Plummer ICR Team Leader: Mats Johan Rikard Liden ICR Primary Author: Mats Johan Rikard Liden
F. Results Framework Analysis
Project Development Objectives (from Project Appraisal Document) The development objective of the project is (a) to improve the reliability of India's Northern Electricity Grid through the addition of renewable, low carbon energy from the Rampur hydropower project; and (b) to improve the effectiveness of Satluj Jal Vidyut Nigam Limited (SJVN) with respect to the preparation and safe implementation of economically, environmentally, and socially sustainable hydropower projects.
Revised Project Development Objectives (as approved by original approving authority)
(a) PDO Indicator(s)
Original Target Formally Actual Value Values (from Revised Achieved at Indicator Baseline Value approval Target Completion or documents) Values Target Years Increased power availability to Northern region off-takers (GWh equivalent per Indicator 1 : annum) Value quantitative or 0 1770 1957 Qualitative) Date achieved 10/31/2007 09/30/2012 06/21/2015 Target has been met. RHP began commercial operation in Dec 2014. Above Comments value refers to the total cumulative generation at writing of ICR. The value given (incl. % for the final ISR only represented a partial annual generation since FY stretches achievement) from April-March. % of time frequency in the Northern Electricity Grid is in the operating band of Indicator 2 : Indian Electricity Grid Code Value quantitative or 78.83% 90.30% 98.9% Qualitative) Date achieved 03/31/2007 09/30/2012 12/31/2014 Target has been met. The operating band was changed by IEGC later on, which Comments has been used for the observed value (86.2%) given in the final ISR. If the (incl. % operating band valid at appraisal would be used for calculation, the value at achievement) closing would be 98.9%. Indicator 3 : Number of days of outage of NJHP in wet season Value quantitative or 32 24 4.6 Qualitative) Date achieved 03/31/2007 03/31/2012 12/29/2014 The target has been met. The downward trend in outages is beyond what can be Comments explained by changes in riverine sediment transport and is evidence that the (incl. % deliberate measures employed by SJVN over the life of the project have been achievement) successful. Indicator 4 : Improvement in off-taker satisfaction with respect to SJVN service Value No evidence of upward Strong evidence of Strong evidence of quantitative or trend upward trend upward trend Qualitative) Date achieved 03/31/2007 12/31/2012 12/31/2014 Comments Target has been met. By the Mid-term Review, SJVN had reported an increase in (incl. % satisfaction from 96.7% in 2007 to 99.9% in 2010. In 2013 and 2014, all achievement) offtakers rated SJVN highly satisfactory in all survey dimensions (100%).
Indicator 5 : Improvements demonstrated in social development surveys Value No evidence of upward Strong evidence of Strong evidence of quantitative or trend upward trend upward trend Qualitative) Date achieved 03/31/2007 12/31/2012 12/31/2014 Target has been met. The independent survey conducted at the end of the project Comments show an increase in average incomes and other indicators of wellbeing, including (incl. % literacy, modern durables, house size, and share of people living in permanent achievement) housing.
(b) Intermediate Outcome Indicator(s)
Original Target Actual Value Formally Values (from Achieved at Indicator Baseline Value Revised approval Completion or Target Values documents) Target Years Component A: Construction of the 412 MW Rampur run-of-river hydroelectric Indicator 1 : scheme - Power House (% completion) Value (quantitative 0% 100% 100% or Qualitative) Date achieved 03/31/2007 12/31/2012 12/29/2014 Comments The main power house is completed, electro-mechanical equipment installed and (incl. % proven to run at full capacity in December 2014. achievement) Component A: Construction of the 412 MW Rampur run-of-river hydroelectric Indicator 2 : scheme - Head Race Tunnel (% completion) Value (quantitative 0% 100% 100% or Qualitative) Date achieved 03/31/2007 12/31/2012 12/31/2014 Comments The HRT was completed and functional (filled with acceptable seepage levels) (incl. % in March 2014. achievement) Component A: Construction of the 412 MW Rampur run-of-river hydroelectric scheme - EMP implementation - (i) Muck disposal as per plan; (ii) Indicator 3 : Compensatory afforestation - trees; (iii) Funds utilization on CAT plan activities (excluding maintenance) (i) 100%; (ii) 86% (120 ha out of 139 Value (i) 100%; (ii) ha); (iii) 82% (Rs. (quantitative (i) 0%; (ii)0%, (iii) 0% 100%; (iii)90% 185.19 million out or Qualitative) of Rs. 226.15 million) Date achieved 03/31/2007 12/31/2012 12/31/2014 Comments Leveling of all muck has been completed; vegetation has been planted in all (incl. % muck dumping sites. Implementation of Afforestation and CAT rests with achievement) regulatory authorities and is pending full completion.
Component A: RAP & Community Dev. Plan impln.: (a) Landowners receiving full entitlements; (b) Real increase in PAF's standard of living (measured by % Indicator 4 : of PAFs with increased income or assets); (c) Amt spent on small infra & local contracts awarded Value (a) 100%; (b) (a) 100%; (b) 99%; (quantitative (a) 0%; (b) 0%; (c) 0 90%; (c) Rs. 200 (c) Rs. 337 million or Qualitative) million Date achieved 03/31/2007 12/31/2012 12/31/2014 All affected people resettled &/or fully compensated for loss of land by 2007 Comments before start of civil works; increased livelihood of PAFs has clearly been proven (incl. % by End-Term Impact Evaluation; target for amount spent on local infrastructure achievement) & contracts met Component B: Investment support to implement measures for ensuring higher Indicator 5 : availability of the existing upstream NJHP: (i) Blanking panels and dredging pumps installed; (ii) Procurement of contingency spares Value (i) 100%; (ii) (quantitative (i) 0%; (ii) 0% (i) 100%; (ii) 100% 100% or Qualitative) Date achieved 03/31/2007 12/31/2012 12/31/2014 Investments conducted by SJVN included blanking panels at intake, hard-coating Comments of turbine components, and improved maintenance procedures of the runners, (incl. % which successfully achieved a decrease in the number of days per year with achievement) outage. Component C: TA for institutional reform & capacity building - implementation Indicator 6 : of agreed action plan including: (i) Safety action plan (reduction in reported cases of non-compliance with safety procedures - % of prior year) Value (quantitative - 10% 39% reduction or Qualitative) Date achieved 03/31/2007 12/31/2012 12/31/2014 Comments Improved OHS was reflected also in a reduction in accident reports from RHP (incl. % construction, showing a clear decrease of about 15% per year from 26 in 2007 to achievement) 3 in 2014. Component C: (ii) Dam safety reviews carried out on time and follow up action Indicator 7 : taken; (iii) Financial management action plan (timely and accurate preparation of quarterly accounts) Value (ii) 100%; (iii) (ii) 100%; (iii) (quantitative (ii) 0%; (iii) 0% 100% 100% or Qualitative) Date achieved 03/31/2007 12/31/2012 12/31/2014 Comments (incl. % Dam safety and financial management procedures fully complied with. achievement) Component C: (iv) Contract management action plan (variations confirmed Indicator 8 : through issue of priced variation orders) Value (quantitative (iv) 0% (iv) 85% (iv) 76% or Qualitative)
Date achieved 03/31/2007 12/31/2012 12/31/2014 Comments 74 out of total 98 claims issued as variation orders by January 2015, remaining (incl. % claims with Dispute Resolution Board achievement) Component C: (v) Environmental capacity (person days training); (vi) Other Indicator 9 : training including organizational effectiveness (person days) Value (quantitative (v) 0; (vi) 0 (v) 1000; (vi) 2000 (v) 630; (vi) 1884 or Qualitative) Date achieved 03/31/2007 12/31/2012 12/31/2014 Comments (incl. % Number of training days reported less than target (84%) achievement)
G. Ratings of Project Performance in ISRs
Actual Date ISR No. DO IP Disbursements Archived (USD millions) 1 03/30/2008 Satisfactory Satisfactory 0.00 2 08/09/2008 Satisfactory Satisfactory 18.34 3 02/02/2009 Satisfactory Satisfactory 61.04 4 09/22/2009 Satisfactory Moderately Satisfactory 92.63 Moderately 5 04/09/2010 Moderately Satisfactory 108.18 Unsatisfactory Moderately 6 11/07/2010 Moderately Satisfactory 137.40 Unsatisfactory 7 02/27/2011 Satisfactory Moderately Satisfactory 152.73 8 09/06/2011 Satisfactory Moderately Satisfactory 196.41 9 01/18/2012 Satisfactory Moderately Satisfactory 231.06 Moderately 10 08/26/2012 Moderately Satisfactory 270.96 Unsatisfactory Moderately 11 12/12/2012 Moderately Satisfactory 316.89 Unsatisfactory 12 03/20/2013 Moderately Satisfactory Moderately Satisfactory 316.89 13 10/09/2013 Moderately Satisfactory Moderately Satisfactory 379.96 14 03/06/2014 Moderately Satisfactory Moderately Satisfactory 386.03 15 04/20/2014 Satisfactory Satisfactory 386.03 16 09/15/2014 Satisfactory Satisfactory 394.03 17 01/08/2015 Satisfactory Satisfactory 394.03
H. Restructuring (if any)
ISR Ratings at Amount Board Restructuring Disbursed at Restructuring Reason for Restructuring & Approved Restructuring Date(s) Key Changes Made PDO Change DO IP in USD millions The restructuring was based on a request received from the borrower (SJVNL) through the Department of Economic Affairs (DEA) letter dated August 4, 2011. It was proposed to extend loan closing from March 31, 2012 to December 31, 2014 due to delays resulting from poor geology. It also re- 10/04/2011 S MS 210.20 appropriated funds from Component B to Component A since the borrower implemented Component B using its own resources. Lastly, a change in the implementation responsibility for the Sustainable Community Development Program (SCDP) was made to include the State of Himachal Pradesh.
I. Disbursement Profile
1. Project Context, Development Objectives and Design 1. Country Background. As noted in the Country Partnership Strategy1 for India for the Period FY2013–2017, India’s economic and human development is one of the most significant global achievements of recent times. Between 2005 and 2010, India’s share of global GDP increased from 1.8 to 2.7 percent, and 53 million people were lifted out of poverty. Growth has steadily accelerated over time, showing resilience even in the aftermath of the global crisis. In the last decade, India’s economy expanded at an average annual rate of 7.6 percent, placing it in the top 10 of the world’s fastest growing nations. Progress on human development has been remarkable; life expectancy more than doubled from 31 years in 1947 to 65 years in 2012 and adult literacy more than quadrupled, from 18 percent in 1951 to 74 percent in 2011.
2. Power Sector Context. The power sector has to expand if India is to continue to grow at their targets of 8-10 percent over the next two decades. An estimated more than 300 million people in India do not have access to electricity. The average annual per capita consumption of electricity of those who have access was 914.4 kWh in 2012-13, far below the world average of 3,045 kWh. The system’s average peak time deficit of about 4.7 percent (2015) and average energy deficit of about 3.6 percent (2015) have resulted in high coping costs for industry and households. Insufficient power generation and inadequate electricity service delivery mechanisms thus remain a critical constraint to India‘s sustained growth, its national economic competitiveness; private investment in industry; and poverty alleviation efforts. The Government of India (GoI) has embarked on an ambitious investment program to add generation capacity, almost doubling it by the end of the 12th Five-Year Plan, i.e. 2017, from 132 Gigawatts (GW) at the beginning of 11th Five-Year Plan. It also plans to expand and strengthen transmission and distribution networks and improve the technical and commercial efficiency of power utilities.
3. Hydropower Sector Context. India has almost 100 GW of undeveloped hydropower potential. If developed in accordance with good practices, this untapped potential can provide a clean energy source which is well-suited to the country’s energy needs, particularly its high daily peak demand. Hydropower can also enhance energy and water security, contribute to a lower-carbon economy, and bring development benefits to the more remote regions of the country, where most of the undeveloped hydropower potential is located. During the 11th Plan (2007-2012) GoI aimed to develop 16 GW of hydropower capacity. During the 12th Plan (2012-17), it aims to add additional 20 GW and to increase hydro’s share in the country’s total installed generation capacity to 40 percent.
4. However, its significant potential notwithstanding, the hydropower sector in India faces challenges. Despite its ambitious goal for hydropower expansion, only 5.5 GW were added in the 11th plan, and in the 12th plan, about 1.9 GW have been added till February 2015. Major challenges are:
Technical: The Himalayas, where most of the potential exist, are young and geologically unstable mountains; this poses unique challenges for hydropower development in this region. The complexity of the Himalayas creates risks for
1 Report No. 76176-IN, Country Partnership Strategy for India for the Period FY2013-17, March 21, 2013
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construction and operation, specifically related to geology and sediment transport; developers are taking time to adjust to international innovations and contract management procedures to deal with such risks.
Professional/managerial: The relative dearth of new hydropower projects in recent decades led to a contraction of the number of professionals active in the sector and to an under-representation of core skills in certain specialized areas of hydropower development.
Legal/regulatory: The changing legal and regulatory framework for land acquisition and resettlement and the evolving socio-political dynamic of infrastructure development in India have raised the bar for all large infrastructure projects. Developers have been slow to build up the skills required to respond to the greater expectations of project-affected people, leading to delays in project preparation. Additionally, the process of obtaining relevant clearances and approvals, including environmental, land acquisition, and tariff agreements, requires a lot of time and resources, and has discouraged even some of the most highly skilled developers from going forward with their concessions.
Financial: Hydropower projects are capital-intensive, risky and have long payback periods. Development has been constrained by limited availability of long-term financing and a slow emergence of tariff incentives to stimulate hydropower development. Furthermore, the added geological complexity of Himalayan hydropower often results in cost overruns and delays, which can impact the financial viability of hydropower projects.
5. Overview of project. The Rampur Hydropower project (412 MW) was approved by the Board of Directors on September 13, 2007. The project was designed as a specific investment loan (SIL) to finance the development of the Rampur Hydropower Project. SJVN Ltd. (SJVN), a joint venture between GoI and the Government of Himachal Pradesh (GoHP), chose to denominate the loan in US dollars, considering the longer tenure available for such loans.
6. The project aimed not just to increase hydropower’s share in country’s power mix, as defined by the five year plans, but also to address the key challenges in the hydropower sector in India. The Bank’s main value addition was to advance good implementation models and help create an enabling policy and institutional environment for sector development. Component A (Rampur Hydropower Station) and Component B (support to Nathpa Jhakri Hydropower Station), were thus accompanied with a broad capacity building component.
7. The project became effective on April, 14, 2008 The Rampur power station was fully commissioned, producing and selling power at its full capacity in December 2014. The project was closed on December 31, 2014. On January 27, 2015 the disbursements reached US$400 million reflecting 100% disbursement of the loan.
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1.1 Context at Appraisal
8. At the time of appraisal, the power sector was plagued with daunting challenges, including low levels of connectivity, especially in rural areas; demand that far outstripped supply; below market pricing of electricity; and high rates of loss in distribution. It was estimated that about 25 percent of grid supply infrastructure was in need in rehabilitation, and the cost to industry of coping with unreliable supply was exorbitant with some 60 percent of Indian firms relying on captive or back-up generation.
9. Furthermore, despite being recognized internationally as a low-intensity and low per capita producer of CO2, India was producing 1.1 billion tons per annum of CO2 or 4 percent of the world’s total and on track to producing 13 percent of the world’s total emissions. Achieving a lower carbon development path with cleaner power generation options was seen as very important to the Government of India.
10. To address many of the issues in the power sector, India set out to implement the National Electricity Policy (NEP) 2005, which identified the following goals for the year 2012: (i) providing electricity access to all households; (ii) eliminating power shortages; (iii) doubling per capita electricity consumption to 1000 kWh per annum; and (iv) achieving the financial turnaround and commercial viability of the sector.
11. Rationale for Bank Assistance. The government envisaged that the Bank’s re- engagement in the hydropower sector in India, beginning with the Rampur hydropower project, would provide experience of good practice for hydropower development, targeting support at about 10 percent of the 16 GW of hydropower capacity it intended to develop during the 11th Five Year Plan. Through a partnership with a few developers in specific states, it was seen that the Bank could help institute international technical and sustainability practices in the Himalayan region, the home of much of India’s untapped hydro resources. In parallel, the Bank sought to strengthen the institutional foundation for the government’s plans of scaling up development of 100-150 GW of India’s renewable power potential by 2030.
12. The Bank’s broader engagement in the power sector sought to support the government’s priorities of improving electricity services, expanding access and optimizing the utilization of indigenous resources, while also helping to put the country on a lower carbon emission path rather than continue under a “business-as-usual” scenario.
13. The Bank’s support for the Rampur Hydropower Project (“Rampur”) was considered to be the first step in a continuing engagement aimed at: (i) providing assistance to the long- term sustainable development of hydropower as a renewable resource in India; (ii) assisting the sector in consolidating recent improvements in sustainable hydropower development and moving towards international good practices; (iii) strengthening the capacity of some of the agencies involved; and (iv) providing support to a low carbon growth strategy.
14. Rampur was also a significant milestone for the World Bank, based on careful strategic discussions about the Bank’s re-entry into hydropower development in India and scaling up its engagement globally.
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1.2 Original Project Development Objectives (PDO) and Key Indicators
15. The development objective of the project was: (i) to improve the reliability of India's Northern Electricity Grid through the addition of renewable, low carbon energy from the Rampur Hydropower Project; and (ii) to improve the effectiveness of SJVN with respect to the preparation and safe implementation of economically, environmentally, and socially sustainable hydropower projects.
16. The prime indicator for measuring the improved reliability of India’s Northern Electricity Grid was the proportion of the time over which the grid frequency is maintained within the operating band of India’s Electricity Grid Code. It was expected that the project’s capacity would be small compared to the size of the Northern Grid, so its impact would have been marginal, but important2. The improvement in effectiveness of SJVN was measured by the preparation and implementation of training plans and the adoption of good practices in various areas, including safety, financial management, contract management, and communications.
1.3 Revised PDO (as approved by original approving authority) and Key Indicators, and reasons/justification
17. The project was restructured on October 4, 2011 in response to a request from the borrower to extend loan closing, re-appropriate funds from Component B to Component A, and include the State of Himachal Pradesh as an entity responsible for the implementation of the Sustainable Community Development Program (SCDP) under Component A. There was no change to the PDO, and only one change was made to the PDO-level results indicator “Increased power availability to Northern region off-takers ([GWh] equivalent per annum)” to more accurately reflect the outcome that was being monitored.
1.4 Main Beneficiaries
18. The main beneficiaries under the project were the Northern Regional Grid, which benefitted from low-cost and reliable power supply; SJVN, which benefitted from increased technical and management capacity; and the local population whose standards of living improved through investments in infrastructure such as roads, creation of employment opportunities, and various community development activities.
1.5 Original Components
19. The project consisted of three components: Component A - construction of the 412 MW Rampur run-of-river hydroelectric scheme (US$ 365 million); Component B - investment support for measures to ensure improved availability of the upstream Nathpa Jhakri Hydropower Project (US$ 30 million); and Component C - technical assistance for institutional reform and capacity building to assist the borrower, SJVN, in moving towards international good practices in hydropower development and operations, and improving its standards of project preparation for future projects (US$ 5 million).
2 The RHP is part of the Government’s wider power development plans, which taken together, will have a significant impact on the reliability of power in the Northern Grid.
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20. Component A included the construction of the 412 MW Rampur hydropower station, but also the associated local area development through the implementation of the Resettlement Action Plan (RAP) and the Sustainable Community Development Program (SCDP). It also included the implementation of the Environmental Management Plan (EMP), which targeted mitigation of both project-specific impacts as well as regional environmental development programs through afforestation and watershed management (Catchment Area Treatment – CAT – plan). Although a relatively small investment, compared to the physical infrastructure investment, experience in India shows that these local development sub-components are crucial for creating local ownership of infrastructure development, and ultimately the successful development and operation of the hydropower plant with targeted outputs. See Annex 7 for a detailed technical description of Rampur.
1.6 Revised Components
21. During restructuring, Component A was increased from US$ 365 million to US$ 395 million to partly cover the increased costs due to construction delays and the changes to the price index. This allocation was taken from Component B (US$ 30 million), which was ultimately completed using counterpart funding.
22. In case of Component B, the procurement of spares (bye pass needle valves, upper & lower labyrinth seals, check plates, runners, guide vanes etc.) was undertaken by SJVN from the original equipment manufacturers/suppliers based on the urgent requirement of NJHP. Given that this procurement method is not consistent with World Bank recommendations, SJVN decided to utilize its own funds. Additionally, the procurement of blanking plates and dredging pump for intakes were initiated before the effective date of loan agreement with the World Bank, and the Bank procurement process was not followed. Thus, the funds allocated under Component B for this were not utilized. Lastly, an additional tunnel to divert silt laden water was to be constructed using funds from Component B, but the model studies undertaken after loan appraisal showed that the tunnel would not satisfactorily eliminate the silt and was, thus, dropped.
1.7 Other significant changes
23. Restructuring. During restructuring, the loan closing was extended from March 31, 2012 to December 31, 2014 due to implementation delays resulting from the underground tunneling work, which was affected by poor geology. With the help of the Advisory Board and of the World Bank, SJVN finalized and agreed to a revised project completion schedule with all three main contractors. SJVN satisfactorily completed the Tunnel Acceleration Plan (TAP), enabling them to complete construction of the project in line with the revised schedule.
24. During restructuring the implementation responsibility for the Sustainable Community Development Program (SCDP) was changed to include the State of Himachal Pradesh in addition to SJVN. This change was triggered by the new Hydropower Policy in Himachal Pradesh, which came into force in 2011. Under this new policy, hydropower developers should deposit the funds for local area development with the Local Area Development Authority (LADA) under the GoHP that will sanction, execute and monitor these schemes. The change thus meant that there was a dual responsibility for implementation of the community
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development program, compared to the earlier arrangement of only the Borrower implementing these works.
25. Hydropower Policy. The new Hydropower Policy in Himachal Pradesh further brought in significant changes for benefit sharing to local communities living in the affected villages during the operational life of hydropower project. According to the policy, annual revenue equivalent to 1 percent of power sales from the RHP will be distributed to households in the project affected area. This will be in the form of annuity payments through cash transfers made directly into bank accounts.
26. Carbon Finance. In 2011, a separate Carbon Finance project (P101274) was approved. It was registered as Clean Development Mechanism project on July 14, 2011 by the United Nations Framework Convention on Climate Change. The project will generate emission reductions in amount of about 14 million tCO2 during the years 2014 – 2024. The World Bank as Trustee of the Umbrella Carbon Facility signed Emission Reduction Purchase Agreement with SJVN on October 6, 2011 to buy Certified Emission Reductions from the Clean Development Mechanism project during its first several years of operation (2014-2018). The expected additional carbon finance revenue will improve the financial performance of SJVN. Upon closing of the Carbon Finance project, a separate ICR Report will be prepared.
2. Key Factors Affecting Implementation and Outcomes
2.1 Project Preparation, Design and Quality at Entry
27. Soundness of the Background Analysis. The preparation of Rampur was the result of many years of work by the Bank in the energy sector of India, using lessons learned from the Nathpa Jhakri Hydropower Project (NJHP) for which SJVN was also the client as well as from the challenges of other recent hydropower projects that failed to be implemented. Rampur was the first hydropower project to be prepared in India after almost a decade-long period in which hydropower and large dams were considered very controversial. The PAD was very extensive, showing that the team left no stone unturned while covering the various technical, economic, institutional, social, environmental, and communication aspects.
28. The preparation team included a significant number of staff with experience from the NJHP and thus had a good understanding of SJVN’s challenges. This, combined with strong commitment from SJVN to carry out the follow-up project and internalization of lessons learned from NJHP (see Annex 8), provided an environment for the honest exchange necessary to deal with issues that would arise during implementation.
29. The preparation of technical, economic, social and environmental aspects aimed to merge international good practice with Indian standards and procedure. A number of internationally recognized technical experts were assigned to support the Client’s and the Bank’s preparation work. Based on the challenges faced during the implementation of the NJHP, major emphasis was put on Rampur’s implementation arrangements, and financial and contract management.
30. In combination, the extensive first-hand knowledge, experience, and lessons learned from international hydropower development, the power sector in India and from previous
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hydropower projects in Himachal Pradesh by the preparation team, provided a sound background and rationale for the Bank’s involvement. It helped not just to motivate and prepare the project for implementation, but also to underscore the project’s role in the Bank’s larger re-engagement in the hydropower sector in India.
31. Assessment of the Project Design and Risks. The project components and implementation arrangements were the result of the experience from previous sector work, and the problems faced by the Client at the time of preparation. Component A was the implementation of Rampur, and its design and associated social and environmental programs were based on international good practice and the experience from NJHP. Component B was answering an urgent need to address maintenance problems at NJHP related to higher than expected silt levels in River Satluj. Given that Rampur is constructed as a cascade with NJHP, and any shutdown of the upstream NJHP would negatively affect the Rampur power production. Component C was designed to raise the capacity of SJVN to implement the project, focusing on the areas highlighted from lessons learned from NJHP.
32. The project was technically well prepared in accordance with international good practice. The choice of Rampur as a prioritized hydropower project to invest in was based on a thorough option assessment by the GoI. Six different design options for Rampur were studied carefully as part of the preparatory studies, and the optimal design option was selected based on geological, environmental, social and operational aspects.
33. In hindsight, considering the need for restructuring because of delays in construction time, an increase of construction cost, and the fact that Component B was in the end fully covered by the counterpart’s funding, the realism of the project design and the risks can be questioned. However, the RHP is a typical example of the inherent complexity of large hydropower development and the difficulty of balancing Client expectations with realistic time and cost estimates. Looking more carefully into the appraisal document and the actual outcome of the project, it can be seen that the changes in time and cost of the RHP did not come as a surprise.
Risks were candidly and accurately described in preparation. The actual challenges faced during the implementation (the unexpected poor geological conditions and delays in parts of the implementation of environmental and social activities) were identified as high risks during preparation.
The economic and financial analyses during appraisal included sensitivity assessments that covered the actual delay of 33 months for the construction period and actual increased construction costs of 15%, and proved that even with such alterations the project would be economically and financially viable.
The studies during preparation on lessons learned on contract management from NJHP and focus on the capacity of the SJVN in contract management for the implementation arrangements for Rampur acknowledged the need for adaptive management of large hydropower, where some of the works will need to be modified during actual construction. Changes in the construction schedule were, therefore, transparently anticipated and prepared for already during preparation.
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The full utilization of Component B, including construction of a tunnel to divert silt, was acknowledged to be contingent on model results conducted at the start of the project. These model results conducted during implementation in the end indicated that such tunnel would not be efficient.
34. It could be viewed as a minor shortcoming of preparation that a larger cost and time contingency was not provided for during the construction of the Rampur despite the early identification of major risks. Given the context during preparation, however, it was difficult to do so; SJVN faced challenges in pursuing an implementation schedule longer than five years and a larger contingency because of strict standard thresholds used by GoI at that time.
35. Assessment of the PDO and indicators. The Project Development Objective was formulated in terms of the project’s impact on the ‘reliability of India's Northern Electricity Grid’, which is sound because of hydropower’s essential role for grid stability. At commissioning of RHP the northern grid had less than 25% installed capacity from hydropower. The choice of a prime outcome indicator being the percentage of time which the grid frequency is maintained within the operating band of India’s Electricity Grid Code (IEGC), however, created an attribution challenge since the RHP only comprised about 10% of the hydropower capacity addition in the northern grid since 2007. In addition, the choice of the target for this indicator was made without considering the risk that the operating band of IEGC would change. The operating band was tightened by IEGC during the project duration from an original 49.2- 50.3 Hz to 49.9-50.05 Hz.
36. Adequacy of Government’s Commitment. The commitments from GoI and the GoHP to support Rampur followed from the alignment of the project with the country’s plans to develop hydropower at the time of preparation, and their joint ownership of the SJVN.
2.2 Implementation
37. Factors that gave rise to problems and actions made to address these. During construction, the poor geological conditions led to significant delays in the tunneling work. The pace of excavation on the 15 km long headrace tunnel that would deliver de-silted water to the powerhouse was severely affected by poor rock quality, which at the start of the project was expected to be 65% good rock and 35% poor rock. Actual conditions turned out to be 15.7% good rock and 84.3% bad rock. To address these issues, the team brought in international tunneling experts and formulated a Tunneling Acceleration Plan, which included an additional adit as well as a change in methodology. These measures vastly improved the rate of excavation from an average of 0.8 meters per day from each face in June 2010 to more than 2 meters per day by that November. Even though the project closing date had to be extended due to these delays, the response chosen by the team dramatically reduced the additional time that was needed to complete the civil works.
38. Successfully overcoming these major construction difficulties was possible because of an open, innovative and honest collaboration between the SJVN and the Bank team.
During implementation, the Bank team maintained a number of key experts, both locally based in Delhi and in DC, with experience from the NJHP project and the Rampur preparation. This enabled a trustful working relationship with SJVN. The
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Bank also showed its added value by bringing in specific international expertise from staff members and from its extensive external network.
SJVN showed a strong willingness to learn and deploy innovative solutions. Based on the advice from international experts, a number of measures were adopted for Rampur that were innovative for the Indian context. This was especially the case for the tunneling work, e.g. the replacement of conventional ribs with lattice girder, the use of bamboos instead of fiber rock bolts to stabilize the disturbed rock mass, the use of twin cutters, etc.
The acceptance by SJVN to adopt proactive contract management and execute necessary variation orders, together with support from the Bank team to accomplish crucial variations, enabled the client to find solutions together with the main contractors instead of creating conflicts and further delays.
39. The complexity of hydropower and the difficulty of changing behavior in a mature sector created challenges during implementation and are transparently reported by the ISRs. Technical problems were experienced not just with the tunneling; landslides and wall collapses occurred in association with the construction of the power house. Unexpected challenges were also experienced with the installation and commissioning of the electro-mechanical equipment, and the transmission lines for evacuation of the power to be built by PowerGrid were delayed. Implementation of the EMP, RAP and local community development programs experienced some delays; the acceleration of the tunneling work generated additional muck that was not planned for, which had implications for muck removal and re-vegetation. Compensation payments for crop and house damages for affected people were delayed by cumbersome administration and the need to go through State Government, and occupational health and safety aspects for construction sites were difficult to enforce at international good practice level with the local contractors.
40. These challenges for Rampur were addressed through strong presence and local knowledge by the Bank team, and a willingness by the Client to engage in tough discussion to find solutions. Besides the bi-annual implementation support missions, the Bank team conducted visits to the site on a monthly basis during the key construction and commissioning periods. In addition, the Bank’s support for the Development Policy Loan (DPL) to Promote Inclusive Green Growth and Sustainable Development in Himachal Pradesh, including the implementation of the new State Policy on Hydropower, provided important communication channels with policy makers at the state level.
41. A contributing factor to the relatively smooth implementation of the RHP from a local community perspective was the keen attention from both the SJVN and the GoHP to address social issues and local development. Although minor incidents with public protests occurred early in the project, and there were delays in compensation payments, these were all sorted out through a constructive dialogue led by SJVN. Significant resources and time were invested by SJVN to improve local livelihoods beyond the compensation to project affected people, including: medical facilities, improved infrastructure and public buildings, merit scholarship, business for local people linked to construction and operation of Rampur, training for income
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generation activities among local people3. In addition, the new State Policy requires that 1% of the power sales from the Rampur will be distributed to households in the project affected area, which supports further local ownership of the project.
42. The training programs under Component C raised the awareness of a broad group of employees from SJVN and the main contractors on technical, environment, social, occupational health and safety aspects. This was likely a positive factor in implementing the solutions for challenges experienced during construction. The multi-year institutional strengthening program for SJVN conducted in Component C to build capacity of the company to effectively implement and develop hydropower projects in an economic, environmentally, and socially sustainable manner, further increased awareness and understanding among the Client’s management team of the broader spectrum of challenges linked to hydropower development, which helped SJVN to accept the implementation of international good practice for the RHP.
43. Project components to be implemented by GoHP. A major change during project implementation related to management of social aspects, specifically the Sustainable Community Development Program (SCDP). With the implementation of the Hydropower Policy for the State of Himachal Pradesh in 2011, SJVN was required to deposit the funds for local area development with the Local Area Development Authority (LADA), which would execute and monitor the activities under the program. This transfer of responsibilities for the benefit sharing programs to the GoHP added to responsibilities of the state for project implementation, including for the compensatory afforestation, CAT plan, wildlife conservation, and a sewage treatment plant under the EMP. SJVN was still responsible for the funding of these activities and have deposited the corresponding funds with the relevant GoHP authorities.
44. The commitment of the GoHP for sustainable hydropower development is anchored in legislation, through its comprehensive hydropower policy. The state policies, together with GoI policies, require hydropower developers to contribute to benefit sharing among local populations and environmental programs, which go much further than compensation for direct project impacts. The challenges experienced for the RHP was, however, that single project obligations are easily overwhelmed by the large local development and environmental management programs run by the State. The implementation capacity of the state was also stretched by taking on the obligations from several hydropower projects at one time. The available capacity with the state authorities is limited, and it is difficult to contravene already agreed long-term implementation plans for state programs with specific project activities and goals. As a result, parts of the CAT plan, the compensatory afforestation, and the SCDP still remained to be implemented when the RHP closed.
45. To address these short-comings in project implementation, the Bank team and SJVN have had regular dialogue with State Government officials, the latest in December 2014. The GoHP remains committed to implementing all outstanding local development and
3 See Annex 5 for a more comprehensive description of the local development activities and the surveyed livelihood results
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environmental management activities related to the RHP, as part of their overall development programs.
46. Communications. The project took a very deliberate approach to communications in order to 1) better engage with the range of stakeholders, including PAFs, local community representatives, and NGOs; and 2) anticipate and manage potential reputational risks to the Bank.
47. At SJVN, this involved sharpening their attention to consultations with project affected communities as well as enhancing disclosure and transparency mechanisms around the project. An early assessment of SJVN’s compliance with the statutory Right to Information (RTI) obligations helped SJVN streamline their internal processes. They also held training for local communities on how to access the RTI mechanisms better. The Project Information Center set up at site emerged as a vibrant one-stop window for project-affected communities seeking more information about project impacts and later evolved as a conduit for grievances as well as requests for accessing benefits (R&R, compensation, local area development, jobs with contractors etc.) mandated under project policies. The SJVN site management also maintained an open-door policy for project-affected people and in fact, some of the persisting concerns of the community (around the impacts of blasting etc.) were managed effectively through SJVN’s enhanced focus on stakeholder engagement. Relations with local media were handled proactively, which also helped manage perceptions around the project.
48. From the Bank’s end, the task team, from the time of project preparation, made sure that there was adequate information out in the public domain about the project. . A comprehensive website was created which sought to clarify all aspects of the project, its impacts and proposed mitigation measures. Throughout the period of implementation, the task team sought to push the boundaries of disclosure even further with regular status updates posted about the project. This proved useful in making sure interested media and civil society was consistently apprised of project progress. Timely meetings with civil society activists also helped pre-empt and manage any emerging flashpoints.
49. The mid-term review and restructuring. The mid-term review in 2010 came at a crucial time, where the construction problems pointed to large delays and cost overruns for the project. The mid-term report forced SJVN to take stock on the situation and come up with a long-term plan to mitigate the problems encountered. Around the time of the mid-term report, the Tunneling Acceleration Plan was agreed on, the implementation plan was revised, and the contracts with the main contractors were negotiated and amended accordingly. The subsequent level II restructuring in October 2011 sealed these revisions on paper and created a new common plan for completion of the project. The restructuring also made it possible to reallocate money from components where funding need turned out to be less than expected (Component B) to other components where funding need had been underestimated (Component A).
2.3 Monitoring and Evaluation (M&E) Design, Implementation and Utilization
50. M&E Design. The monitoring and evaluation framework, driven by the goal to measure the Bank’s added value and ancillary services of hydropower, was partly unrealistic to apply. The main example is the outcome indicator to measure Rampur’s contribution to improved frequency control of the grid, which suffered from an attribution problem given the
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installed capacity of the Northern Grid compared to the size of the project. The frequency band of the grid itself was also shifting throughout implementation due to matters beyond the control of the project. While the assertion at the time of appraisal still holds and has been validated by the statement of the Load Dispatch Center – that the contribution of Rampur would be marginal but important – this has proven difficult to measure as an indicator.
51. M&E Implementation and Utilization. Good quality and relevant data has been collected for the indicators related to activities implemented by SJVN, including through off- taker surveys and national safety advisor reports. The project has also surpassed the efforts of most other Bank hydropower projects on the monitoring of social indicators by doing an impact evaluation with separate data collected for project affected persons and a control group of residents with similar socioeconomic characteristics. A baseline survey was conducted by Himachal Pradesh University, which also conducted the final impact evaluation report, showing changes in income, assets, housing conditions and other relevant socioeconomic criteria. The Mid-Term evaluation was done in November 2010, and the End Term evaluation was conducted in March 2015.
52. Semi-annual project reporting and quarterly reports on implementation progress have been implemented by SJVN. The indicators related to the construction of Rampur, the improvement in reduced outages of NJHP, and the RAP and community development implementation have been regularly updated in a clear way and reported in the ISRs and Aide Memoires. For the construction of Rampur (tunneling, surge shaft, penstock and power house) and for the social programs, additional detailed numeric indicators were developed and used to follow up on progress. For these components the M&E data were clearly used on a continuous basis to inform decisions on project implementation.
53. For other outcome and output indicators the progress reports have tended to be about general progress rather than reporting on the specific indicators as detailed in the Results Framework. This has especially been the case for the EMP implementation and Component C, as well as for the outcome indicators related to improved effectiveness of SJVN. The results have been that the progress of these indicators, although implicitly in the SJVN progress reports, has not been easily accessible during the project. Even in the completion reporting, it has been challenging to make explicit judgment on some indicators since the monitoring has not been measured and reported exactly as the indicator describes, see Annex 2.
54. The progress reporting has been mainly supplied by SJVN as well as taken from GoHP both by SJVN and the Bank. As a result, there were shortcomings regarding the monitoring arrangements for the activities being carried out by agencies of GoHP. Detailed data on indicators such as the compensatory afforestation and Catchment Area Treatment implementation is, therefore, missing.
2.4 Safeguard and Fiduciary Compliance
55. Safeguards. The project was classified as a Category “A” project, triggering the following safeguards: Environmental Assessment (OP/BP 4.01); Cultural Property (OPN 11.03); Involuntary Resettlement (OP/BP 4.12); Forests (OP/BP 4.36); Safety of Dams (OP/BP 4.37); and Projects on International Waterways (OP/BP 7.50).
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56. It should be noted that the designed social and environmental programs associated with the RHP were a joint result of the Bank’s safeguards policies, the policies of GoI and GoHP, and the experience of SJVN and the Bank team of the hydropower sector in India. The awareness and community engagement with large public infrastructure development is very strong in India. As a result the policies and public requirements on social and environmental programs associated with large infrastructure go, in some aspects, further than the requirements of the Bank safeguards.
For Rampur the resettlement, compensation and improved livelihood programs for PAP were augmented by the Sustainable Community Development Plan (SCDP), which focused on building of small infrastructure in the surrounding villages and undertaking community development initiatives. As part of the new Hydropower Policy, the responsibility for the community development works was transferred to the State Government in 2009. Reports from the community, as expressed in the End- Term Impact Evaluation Report (See summary in Annex 5), were that execution of the works became slower after this transfer of responsibility. Ultimately, however, the program has generated significant benefits for the community and contributed to the overall social acceptability of the project.
Forestry is the major land use in Himachal Pradesh and therefore, one of the primary environmental management issues for the RHP. Certain EMP activities such as CAT Plan, Wildlife Conservation and Fisheries Development, etc. for Rampur was, to a large extent, based on standardized offsets as guided by GoI and GoHP policies rather than the direct environmental impacts, which are low due to the project being a run- of-river scheme in a cascade with the upstream NJHP. Despite a direct affected area of only 0.865 km2, the compensatory afforestation and CAT plan were based on a standardized defined area of 154 km2 (7 km radius). In addition, SJVN agreed with the GoHP to support their state programs on fisheries development and wildlife conservation, as well as funding of a sewerage plant in Rampur village, as part of the EMP, although there is no direct link between these activities and environmental impacts of the RHP.
57. Involuntary Resettlement. The land acquisition, resettlement and compensation for damages caused by Rampur have been fully completed at the closure of the project in accordance with the RAP. The End-Term Impact Evaluation, shows that the PAFs have an overall improved living standard; proportion of workers in regular employment, average income, earning capacity and diversification of income have increased, and housing standards have improved.
58. The magnitude of private land acquisition identified at the time of appraisal in June, 2007, was about 30 hectares and is remained same at the time of closure of the loan in December, 2014. The final impacts includes 29.86 hectares of private land impacting 208 families (about 1000 persons) including 29 physically displaced families. The final amount of expenditure involved towards land acquisition and resettlement implementation is Rs.286 million (about US$ 5 million), which is about 1% of the total cost of the project. In addition, the project also incurred an additional amount of Rs. 480 million (US$ 8 million) towards community development and other welfare activities in project affected villages.
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59. PAFs have received full and adequate compensation. 99.5% of the compensation amount has been paid. The reason for not reaching 100% at closure is that one (1) displaced family has refused to accept the generally agreed cash compensation and filed a case in court in the Shimla District. The money is set aside by SJVN and will be paid out in concurrence with the decision of the court, which is still pending.
60. Minor delays were experienced in the payment of compensation for crop and blasting damages, which caused the project to be rated Moderately Unsatisfactory for Involuntary Resettlement during a 1.5 year period. Although the funds had been deposited by SJVN, there were some administration hurdles resulting in delayed payments by the District Administrations in Shimla and Kullu. This matter was solved through repeated interactions between the Bank team, SJVN and the State Government, resulting in the rating being raised to Satisfactory at the end of the project.
61. Environmental Assessment. The environmental concerns identified in preparation has overall been addressed and mitigated as of April 2015 (see Annex 6), although the implementation of the EMP suffered challenges throughout the project duration. The first years where characterized by slow operationalization of the EMP components, including delay in enhancing institutional capacity, setting up procedures for environmental monitoring, executing training plans, and establishing a dialogue with state authorities for implementation of their responsibilities. The main reason for the slow start was likely SJVN management’s focus on the severe technical problems experienced with the tunneling during this period. The Bank team’s regular supervision on this issue, which led to a rating of Moderately Unsatisfactory, and the general re-thinking of the implementation plan around the mid-term review assisted in improving the situation.
62. The overall safeguards and OP4.01 ratings fell to Unsatisfactory in 2012 after a combination of events. The first problem encountered was that the implementation of the Tunneling Acceleration Plan produced large amount of muck from the additional adits and increased work intensity, which the contractor had difficulties depositing in accordance with the EMP measures. As an unfortunate effect of this, a fatal accident occurred when a child climbed a muck deposit and got close to a live 66 kV transmission line, with both the contractor and SJVN subsequently failing to take the appropriate follow up actions. This prompted SJVN to undertake a series of corrective measures to solve the muck removal and reutilization and to improve safety at constructions sites and camps together with the contractors. These measures resulted in a steady improvement of the rating of the OP4.01 to Moderately Satisfactory by the closure of the project.
63. There were also challenges related to occupational health and safety (OHS). SJVN hired a Construction Safety Advisor (International), invested in many days of staff training on OHS issues, but despite observed improvements compared to OHS during the implementation of NJHP, there were a number of tragic incidents – some preventable and others not. Accidents during construction are recognized to be widespread in the infrastructure sector in India4. SJVN, supported by the Bank team, put a lot of effort into improving the safety management,
4 See An overview of Occupational Health and Safety in Indian Infrastructure Projects, prepared by SARDE with support from SASDI, World Bank, 2013
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especially after an incident in 2012 involving a child. Safety team at RHP was strengthened and quarterly audits were conducted, overseen by a National Safety Advisor, and non- compliances were closely monitored. A Safety Action Plan was developed including short, medium and long term measures. Although the slow progress of the implementation of these safety measures was constantly remarked on at the bi-annual Aide Memoires, and despite the fact that OHS aspects were not included in the main contracts in a proactive way, limiting SJVN’s leverage, the RHP showed a clear decreasing trend in accidents and fatalities5.
64. Forests. The EMP required Compensatory Afforestation of 139 ha, despite the estimate that only 49 ha of degraded forest was impacted by the project. The agreed afforestation, which is conducted by the GoHP Forest Department, showed very slow progress during the project, despite SJVN depositing funds for both the Net Present Value of forest and the afforestation activities. Information from state authorities shows that 120 ha of the Compensatory Afforestation had been undertaken by March 31, 2015. Further details are unavailable as monitoring efforts did not generally include those activities for which the GoHP authorities had responsibility.
65. International Waterways. According to the World Bank Policy on International Waterways, both the upstream and downstream riparian countries, China and Pakistan, were notified and provided with relevant project details. No objection to the project was raised by either of the riparian countries.
66. Fiduciary Compliance. At appraisal, it was recognized that despite improvements made by SJVN since its inception, there was still work required to reach the level of financial accountability and corporate governance expected of a public limited company. An action plan was developed and agreed with the Bank for strengthening financial accountability and corporate governance. This action plan has been implemented over the course of the project, resulting in significant improvements. In particular, the internal audit function was strengthened and made more independent; a policy was developed for risk management; and the company achieved compliance with the requirements of the Guidelines on Corporate Governance for Public Sector Enterprises even before these became mandatory. The Bank’s requirements on reporting and management of disbursements have been met. Accounts and audit reports have been filed on a timely basis and disbursements recorded in accordance with the Bank system.
67. Under the action plan, it was also expected that a new financial management computer system (ERP) would be implemented. In order to facilitate this, an ERP compliant financial manual was developed by external consultants and training conducted for staff. However, due to the delay in selection and implementation of an ERP system, these manuals are yet to be fully adopted. SJVN is now taking further steps to implement an ERP and has appointed consultants to assist them in this, but they run the risk of the previously prepared financial manuals requiring review and update, given the delay in their implementation.
5 Accident reports from construction show a clear decrease of about 15% per year from 26 in 2007 to 3 in 2014. Accident rates per year have drastically decreased (by 80%) between the construction of Nathpa Jhakri (1994-2004) and Rampur (2007-14).
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2.5 Post-completion Operation/Next Phase
68. Transition arrangement to post-completion operation. In December 2014, the project synchronized all six units and began commercial operation. It demonstrated that it could run at full capacity and even surpass its design capacity by almost 10%, which will enhance the ability of the plant to provide additional power during peak times. Rampur will be managed with the existing NJHP station as a tandem operation, whereby the water released by NJHP will match the water utilized for power generation in Rampur.
69. The NJHP has shown a clear increasing trend in power production for the period 2007 to 2014, linked to a decrease in days of outages because of high sediment loads in the River Satluj. An analysis of the production and sediment data proves that this is a result of improved operation and maintenance by SJVN as the number of outage days has decreased despite continued high sediment load in the river. The investments conducted by SJVN for blanking plates at intake, hard-coating of turbine components, and improved maintenance procedures of the runners, have ensured high reliability of production at both NJHP and Rampur.
70. It is expected that the Rampur will be requested to provide 1878 GWh per annum, 6% in excess of the 1770 GWh of energy, specified at the time of appraisal, during the next fiscal year, beginning April 2015. This increase is in line with the improved availability of NJHP (related to the reduced problems with sediment) which has led to an increase in its design energy for tariff purposes.
71. The contribution of Rampur, as part of the Satluj River Cascade hydropower, is confirmed as essential for frequency control of the Northern Grid by the Indian Power Load Dispatch Centre. As GoI has narrowed the operating band (a stricter operating band) in recent years, the importance of hydropower as a generation source in the system has become even more important. The request for power from Rampur in the future, both for the normal load, and for frequency control, is therefore likely to be high. The final tariff for Rampur power has yet to be determined, but estimates place it within the range of the Northern Region merit order dispatch.
72. The restoration of muck dumping sites, the construction and camp sites was not complete at the closure of the project, as these sites were still being used for the residual construction activities. However by April, 2015, vegetation had been planted in all muck dumping sites, and all work sites had been decommissioned/ restored. Again, the experience from NJHP indicates the commitment and capacity of the SJVN to manage this transition. Ten years after the end of construction of the NJHP there is no visible sign of construction areas and the power station area is environmentally well maintained.
73. Given the stable financial situation for SJVN, due in part to revenues from NJHP operation, as well as the successful resettlement and local area development activities, no major risks to the sustainability of the project are foreseen.
74. Follow-up by the Bank. The Bank has invested much in capacity development of SJVN as a responsible hydropower developer, through NJHP and Rampur, and in the policy improvement for hydropower development in Himachal Pradesh, through the DPL to Promote Inclusive Green Growth and Sustainable Development with GoHP. The policies and results of Rampur related to local community development and benefit sharing are ground-breaking in India, and there are good reasons to follow-up on how this development continues in the
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operation phase. The results are important to showcase that it is possible to develop large hydropower projects without serious negative local impacts, which is a general view among the public and policy makers in India.
75. The performance indicators to focus on in such follow-up are the financial and institutional capacity of the SJVN and the State authorities to continue to implement the local development plans related to Rampur, and the livelihood of the affected people and local community. It is recommended to conduct a post-project Impact Evaluation a few years into operation, following up on the results of the baseline study and End-Term Impact Evaluation.
3. Assessment of Outcomes
3.1 Relevance of Objectives, Design and Implementation
76. The objectives of Rampur remain highly relevant to the Government of India’s priorities to increase the availability and reliability of electricity through investments in clean and renewable power generation. The RHP contributed to 412 MW (6%) of the added hydropower expansion of 7,400 MW in India under the 11th and 12th Five-Year Plans. Together, the added hydropower capacity to the Indian power system has resulted in significantly improved reliability of the power grid during the last decade, and thereby reduced power shortages. The added hydropower capacity, in line with GoI policies, contributes to a lower carbon development path, and provides power sources enabling increased electricity access.
77. The objectives of Rampur are highly relevant for the Bank’s country and sectoral assistance strategies and corporate goals. The Project contributes to the current Country Partnership Strategy (FY13-17) for India in a number of ways:
Engagement area 1: Integration, though improved reliability of the Northern Electricity Grid (CPS outcome: Improved inter-regional power transmission),
Engagement area 2: Transformation, through increased renewable energy production (CPS outcome: Reduced GHG emissions), and
Engagement Area 3: Inclusion, through inferred electricity access created by the new generation (CPS outcome: Improved access to electricity). A theoretical calculation, following a global tool for inferred access developed by the World Bank in 2014, indicates that in the order of 270,000 households, or some 1.5 million people, would be likely to gain electricity access as a result of the new Rampur generation.
78. The design and implementation of the project were highly relevant to address the GoI’s goal to increase the investments in renewable power generation. The three components were complementarily chosen to install new hydropower capacity (RHP), to invest in measures to improve reliability of the upstream NJHP for which RHP relies on for its full utilization of the new installed capacity, and to raise the institutional capacity of the SJVN to continue to operate the NJHP and RHP sustainably.
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3.2 Achievement of Project Development Objectives
79. At completion, the project has achieved its intended outcomes for improved reliability of India’s Northern Electricity Grid, including a fully operational power plant at Rampur with envisaged capacity. The project has been synchronized with the Northern Grid and proven to run at its installed capacity of 412 MW on a commercial basis in December 2014. It has produced 1957 GWh at the time of the ICR, and the expected request for annual production from Rampur from the load dispatch center for current fiscal year (April 2015-March 2016) is 1878 GWh, above the indicator target of 1770 GWh.
80. From a technical perspective, all large hydropower capacity clearly improves the reliability of the power grid (the opposite is logically impossible) with its unique ability to adjust its production in very short time to control frequency. Rampur’s capacity addition is relatively small compared to the size of the grid, and the extent of other changes to the grid and additional capacity added during the course of the project make it difficult to attribute a precise measure of the improvement in reliability created by Rampur. However, the Indian grid remains in severe need of supplies, which can be controlled according to the requirements of short term grid stability and the value of the project in terms of reliability improvement has been confirmed by the National Load Dispatch Centre.
81. As GoI has increased the requirement for a stable grid (narrowing the operating band) in recent years, the importance of hydropower as a generation source in the system has become even more important. As an example, the sudden outage from another major power source would likely cause a frequency drop in the Northern Grid outside today’s allowed band and force the dispatch center to carry out load-shedding in northern India to avoid a grid failure. In such a situation, RHP and NJHP would, on short notice, be able to adjust its production to avoid the frequency drop. In this way, the RHP, together with other hydropower generation investments in India, has contributed to increase the proportion of time over which the grid frequency is maintained within the operating band of India’s Electricity Grid Code from 79% at time of appraisal, to 99% at time of completion using the same requirement of operating band.
82. At project completion, measures have been fully implemented to decrease the number of days of outages at NJHP, which will contribute to the reliability of production and sustainability of both the NJHP and RHP (the latter which can only be operated in conjunction with the upstream NJHP since they are in a cascade). The outcome indicator of reduced number of days of outage (no power production) at NJHP in the wet season was 32 days/year at appraisal, reaching only 5 days/year at completion, by far exceeding the target of 24 days/year. This outcome contributes to the prime indicator of the project (improved reliability of the grid) through ensuring availability of NJHP and RHP for electricity grid frequency control.
83. At project completion, resettlement and compensation to affected people, community development, and environmental mitigation of direct impacts of the construction of RHP were all satisfactorily completed. Livelihood improvement of affected people was indicated by the independent impact assessment already in mid-term report, and confirmed by the final impact assessment in April 2015. 87% of project affected families reported an increase in income while the share of families with an increase in income and/or assets is 99%. The final evaluation also demonstrates an increase in literacy rates, permanent housing, and size of houses.
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84. Although major steps have already been made, there remains uncertainty in the timing of complete fulfilment of the social benefit sharing and regional environmental offsets for Rampur (which both go beyond compensation to affected families and mitigation of direct environmental impacts). The delayed components, however, only comprise less than 20% of the total social and environmental cost of the project (less than 1% of the total project cost). Considering that these funds are committed and earmarked for activities in the local area that are likely to be implemented, and only comprise a small fraction to the total cost, the shortcomings are considered minor.
85. The effectiveness of the Client, SJVN, with respect to the preparation and safe implementation of economically, environmentally, and socially sustainable hydropower projects have been significantly improved through the project. All outcome targets and component-specific outputs are substantially achieved; SJVN has shown an upward trend in off-taker satisfaction surveys with respect to its service; an upward trend in improved livelihood among project affected people has been demonstrated in independent social development surveys; dam safety reviews have been conducted for NJHP and RHP with 100% compliance; SJVN has an adequate financial management system and internal control framework in place; contract management has been successfully applied during the construction of RHP; safety action plans for construction work have been developed and reported cases of non-compliance with safety procedures have decreased during the project.
86. SJVN has taken the capacity building effort seriously. They have arranged a large number of training courses for its personnel, have contracted national and international expertise in key areas (such as safety, contract management and technical aspects) and have created a corporate social responsibility program. SJVN has made efforts to meet varying demands from project affected people and to take actions to reduce the number of accidents during construction. This has resulted in a project that generally follows internationally good practice (as proven by the Aide Memoires and final ISR). In addition, SJVN has been willing to manage and solve legacy issues related to silt problems and contract claims, and expanded community development activities, for the NJHP (as reported in the mid-term and final report by SJVN).
87. In summary, the project development objectives has substantially been met at the time of the ICR. Minor shortcomings in 100% achievements of four out of the eleven outputs (detailed evaluations of the outcomes and outputs are given in Annex 2), as well as difficulties of numerically monitoring the contribution to improved reliability of India’s Northern Electricity Grid, prevents it from having high efficacy rating.
3.3 Efficiency
88. According to the project appraisal document, the economic rate of return was expected to be 19.3%, assuming operation began in 2011. This compares with a rate of 14.1% calculated on the final cost to completion (detailed economic analysis is given in Annex 3). The project will achieve a 16.5% return on equity as prescribed by the regulator.
89. If environmental benefits of avoided carbon are included, then the ERR at appraisal was only 0.5% higher than the rate excluding such benefits as the assumption was that the avoided generation was based on gas which is a lower carbon emission source than coal.
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Rampur has since been approved for carbon emission reduction credits (CERs of 740,000). If this is included and valued in line with World Bank recommended norms – then the ERR changes to 16.6%, and could be higher if the additional optional CERs are included taking the ERR to 18.5%
90. In summary, despite the finalization of the project having suffered a 21 months delay and a 15% higher construction cost than estimated at appraisal, mainly due to greater than expected geological challenges, the investment gives an adequate economic return. Efficiency rating is therefore judged as substantial, achieving a robust economic return, although slightly lower than expected at appraisal.
3.4 Justification of Overall Outcome Rating
91. The overall rating for outcomes is satisfactory. The basis is its high relevance (as discussed in Section 3.1); substantial achievement of the project development objectives (as discussed in Section 3.2); and its substantial efficiency proven by a robust economic return despite cost and time overruns (as discussed in Section 3.3).
3.5 Overarching Themes, Other Outcomes and Impacts
(a) Poverty Impacts, Gender Aspects, and Social Development
92. The increased reliability of and possibility for increased access to electricity in India through the RHP is an important contribution to poverty alleviation and increased prosperity in the country.
93. In addition, SJVN implemented locally a variety of measures aimed at poverty reduction and social development, including the provision of infrastructure such as roads and the creation of wage employment and small contracts for the local population. The project also provided health services by way of a mobile health van, which began offering services in the villages around the project site very early in project implementation. SJVN has also formulated a Corporate Social Responsibility policy through which it has sponsored a number of community activities. The community consultation process was carried out with care before the project and, as a result, relations with the communities remained constructive throughout the project.
94. As described in the final impact evaluation undertaken by the Agro-Economic Research Centre at Himachal Pradesh University, the project has led to improved income and livelihood for project affected people. The literacy rate has increased from 83 to 88 percent, and the share of workers in the total population increased from 60 to 77 percent. The average annual household income increases over the baseline by 54 percent in real terms, and a significant improvements in the overall housing situation have been reported, with 100% of people living in pukka (permanent) houses compared to 95%. Results of the survey are further discussed in Annex 5.
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(b) Institutional Change/Strengthening
95. The institutional strengthening of the SJVN to showcase that hydropower can be made successfully in India, was at the very core of the RHP, and is highlighted in the PDO. Despite the challenges experienced causing the delays in completion, and partly because of the same challenges, the capacity of SJVN to do responsible hydropower has significantly improved. This is proven by the actions taken by SJVN during the project in the technical, social and environmental fields (as described by the Aide Memoires and ISRs), which has resulted in a project that generally follows internationally good practice.
96. SJVN plans to use this increased capacity to expand its hydropower portfolio in India and in the region, and was awarded, through a competitive process, the concession to develop a large hydropower project in Nepal. SJVN has also been given a number of domestic awards for good practice for hydropower development for its work with Rampur. The RHP is thus already functioning as a showcase for good hydropower development in India. Furthermore, the GoI has as an immediate result of the completion of Rampur requested SJVN and the Bank to arrange a national workshop on the experiences and lessons learned from the project. This workshop is currently being arranged and is planned for September 2015 in Delhi.
97. Rampur has also played an essential part in the development of the progressive Hydropower Policy of Himachal Pradesh. The RHP worked as a role model in regard to its local community development activities for the discussions within GoHP leading up to the new policy. It will also provide the first real test of the policy’s implementation.
(c) Other Unintended Outcomes and Impacts
98. An unintended impact of the RHP was its technical innovations, forced by the geological problems with tunneling. The necessary measures to solve these problems and to accelerate the tunneling work inspired the invention and application of new technical solutions that had never before been used in India.
4. Assessment of Risk to Development Outcome
99. The Risk to Development Outcome is rated as Low. The development outcomes of the project, in essence, cover the continued operation of the NJHP and Rampur to provide renewable power and grid stabilization in northern India, and SJVN’s continued capacity to operate the plants responsibly and sustainably for which the risks are low.
100. Technical, financial, economic, environmental, political, and governance risks are all low. There may be some moderate social risk related to the implementation of the final LADA activities and the new cash benefit sharing programs, but the risk that this escalates to a level where it affects the operation of the NJHP and RHP is low.
101. The hydropower schemes are located in an area prone to natural disasters, but this has been mitigated in the technical design and the probability of extreme events that severely affect the operation is low. SJVN has an emergency preparedness plan in place.
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102. SJVN has proven through the operation and maintenance of the upstream NJHP that it has the capacity for operation and maintenance (O&M) of large hydropower. NJHP has delivered power satisfactorily to the Indian Northern Grid since 2004. It has shown that it can adapt the O&M when necessary, exemplified by the successful measures to significantly reduce the number of shutdowns due to high silt load. Regular dam safety audits have shown full compliance. Because of the tandem operation of the NJHP and RHP cascade, the same SJVN team that has operated NJHP will also operate the joint cascade. The commissioning of the Rampur hydropower station during 2014 has already indicated that this team has the capacity to sustainably make the transition from construction to operation successful.
103. SJVN already has a stable financial situation with the income from power generation at the larger NJHP as their main source of revenue. This will enable SJVN to provide the necessary resources, financial and institutional, for the continued operation of the Rampur power station.
104. The successful resettlement and local area development during the RHP, as well as the annuity from 1 percent of the generated power to the affected people, create the basis for a sustainable relation between SJVN and the local community. Many activities of the local development activities during construction, will continue during the operation, such as the support for medical and schooling facilities. Maintaining this good relationship, however, will require that the expectations for the annuity payments are met without delays and with transparency. The meeting between the Bank team, SJVN and the GoHP in December 18, 2014 highlighted the importance of proceeding rapidly with the implementation of the annuity program, and it was agreed by the Directorate of Energy to complete the process of notification of the beneficiary list by 2015.
5. Assessment of Bank and Borrower Performance
5.1 Bank Performance
(a) Bank Performance in Ensuring Quality at Entry
105. Rating: Satisfactory. The project was very well prepared by the Bank, taking into account all the aspects related to responsible and sustainable hydropower development according to international good practice, and taking into account the lessons learned from the previous NJHP. The PAD is outstanding in quality for a hydropower project prepared by the Bank in the last decade.
106. The reason for the project not receiving a highly satisfactory rating is that the monitoring and evaluation framework was partly unrealistic to apply, and, in hindsight, more contingencies could have been included to manage the technical problems that caused the delay of the finalization and higher cost of construction.
(b) Quality of Supervision
107. Rating: Satisfactory. The Bank team’s had a strong focus on helping the Client to achieve the expected outcomes, being attentive and supportive with constructive criticism and proposed solutions to meet challenges that arose. The adequacy and quality of the
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implementation support is clearly indicated by the Client’s appreciation and acknowledgement at completion that the Bank’s support probably saved several years of further delay in finalization and further cost increases for construction.
108. The non-optimal M&E design in preparation was followed-up by an inadequate focus on the monitoring during implementation. The shortfall in monitoring the indicators in accordance with the M&E plan by GoHP and SJVN, especially in the areas of the EMP and the capacity building, was never strongly pointed out by the Bank team during the implementation support.
109. Understandably, the technical challenges, which directly threatened the outcome of the project, were the major focus during implementation. Also, the focus on the resettlement and local community development was strong, which is understandable from the experiences of other hydropower developments in India. The monitoring of the technical construction progress and the R&R was also well conducted throughout the project. The progress in environmental and capacity building components were more generally described and less frequently followed-up by recorded actions by the team. The Bank team had less leverage with the State authorities compared with its leverage with SJVN; this was a limiting factor in terms of mobilizing action on EMP implementation. However, this component has led to improvements in the state agencies’ capacity to implement such programs, which is expected to benefit future hydropower projects in the state.
(c) Justification of Rating for Overall Bank Performance
110. The overall Bank performance rating is satisfactory. The Bank’s preparation and implementation support was generally of a very high standard as demonstrated by the PAD, Aide Memoires and the Client’s expression of appreciation in its completion report. Minor shortcomings during preparation and implementation, mainly on the design and application of the monitoring and evaluation framework, prevent the rating from being highly satisfactory.
5.2 Borrower Performance
(a) Government Performance
111. Rating: Moderately Satisfactory. RHP forms part of India’s least cost generation expansion plan, and has seen ownership and commitment from both Federal and State Governments. The enabling environment has been in place since start of the project and necessary permits have been granted. The commitment from the GoHP at the political level for the development of responsible hydropower is large as shown by the recent legislation on benefit sharing.
112. The State, however, has experienced capacity constraints, affecting the implementation of several commitments for the project. The Aide Memoires repeatedly report delays in Community Development activities, the Catchment Area Treatment Plan and the Afforestation Program, mainly due to inaction from State authorities. The remaining outputs of the environmental and social components of the project at closing of the project in December 2014 (corresponding to less than 20% of the total E&S budget) all cover activities to be implemented by the State. The reasons for these delays are judged to be minor shortcomings in the readiness
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by the authorities and the lack of priority of RHP activities, since the project is only one small part of the overall responsibility of the State authorities for local community development and land management. Together, these minor shortcomings have resulted in some difficulties in the timely implementation of the responsibilities of the State. In addition, the monitoring and evaluation arrangements for activities to be implemented by the State authorities have been weak.
(b) Implementing Agency or Agencies Performance
113. Rating: Satisfactory. SJVN has been fully committed to project implementation throughout, including the environmental, social and capacity building components. They have shown excellence in financial management and been rated highly satisfactory for counterpart funding throughout the project. Stakeholder and PAF interaction has been excellent with an open door policy. As shown by the results of the component C, SJVN has been committed, and succeeded, to improve its capacity in many aspects of responsible hydropower development.
114. However, a lack of capacity and readiness to develop a second large project resulted in decision-making and implementation of activities not always being efficient and timely. The Aide Memoires report, especially in the beginning of the project, delays in a number of activities, such as payment of compensation for damages due to construction, follow up activities on muck disposal problems, and follow up activities to address safety aspects at constructions sites. Particularly the handling of one case of a fatality in 2012 was not managed properly.
115. The above shortcomings were, in part, caused by delays in appointing key management staff in the early stages of the project. Another reason was the focus on the major technical challenges that directly threatened the outcome of the project. Although this focus was motivated to maintain the project as financially viable, it is not a reason to accept shortfalls in the environmental, social and safety areas of the project.
116. The Aide Memoires also report shortcomings in the monitoring and evaluation work by SJVN relating to the EMP, community development and capacity building activities at varying points in the project implementation. Considering that the capacity trend for SJVN has been upwards during the project, and all of the activities reported as delayed were eventually completed, these shortcomings are, however, considered minor.
(c) Justification of Rating for Overall Borrower Performance
117. The overall performance of the Borrower is rated Moderately Satisfactory. The Federal and State Governments, and SJVN all showed ownership and commitment for reaching the outcomes, and managed to achieve these at satisfactory level. However, they all suffered from lack of capacity and readiness to develop hydropower in its broadest aspects, which led to delays mainly in the environmental and social components. Parts of these delayed activities still remain to be completed at the closing of the project. These delays downgrade what would otherwise be a satisfactory rating to moderately satisfactory.
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6. Lessons Learned
118. In considering the lessons learned from this project it is necessary to identify the achievements against the backdrop of the known complexity of hydropower development. There is rarely a hydropower project whose development and construction can be said to be “straight-forward”. The nature of such infrastructure is that it tends to be site specific, remote and multi-faceted. Rampur was less complex than some others since it did not require a dam, but it had the added complication of the necessity to be operated in tandem with NJHP, together with extensive tunneling in areas known to present geological challenges. In all, the project was well implemented in that the problems which arose were not allowed to derail the progress completely; in each case solutions were found and implemented such that construction continued. The experience of Rampur demonstrates that Indian institutions can partner with the World Bank, even when many other hydropower projects are stalled in the country, to build responsible and sustainable hydropower facilities. In spite of worldwide experience that hydropower projects are extremely difficult due to technical, social, environmental and governance issues, Rampur is an example of what is possible with a willing client and the right technical support. The following are the key lessons learned from the project’s execution for future Bank funded projects: -
119. Trust and communication between the Bank team and the client are key to managing challenging projects. The level of communication between the Bank team and the Client on this project was exceptional with a strong mutual respect and understanding. This was engendered by: - The locally based task team leader and staff Having a task team that was mostly locally-based was also an important success factor. The team was able to be responsive to critical needs of the project, which is evidenced by frequent visits to the project site, sometimes as often as every other month. This local team was combined with senior experts from headquarters and external consultants to ensure the right support could be provided at the appropriate time. ‐ The continuity of team composition Consistency of the World Bank task team during preparation and implementation played a major role in the project’s success. In addition to depth of knowledge of the project from its inception, keeping the same team increased the effectiveness of dialogue with the client. Further, the continuity of some team members from the previous engagement on the Nathpa Jhakri Power Project created an atmosphere of trust and enabled the team to bring the necessary expertise to the project when needed. ‐ Good communication as an objective The emphasis placed by the both sides on maintaining communication as a specific objective in all aspects of the project, leading to open and transparent discussion of issues, as and when they arose, in an atmosphere of mutual respect.
120. It is essential to build trust through early consultation, communication and interaction with the local community. One of the reasons that the Rampur HEP gained acceptance from the local community was the strong effort by SJVN to build a good relationship with the affected community from very early on. Early in project preparation, for
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example, SJVN deployed a mobile health van to deliver health services to the community. This was partly possible because of SJVN’s existing connection to the area and reputation from the Nathpa Jhakri Hydropower Station. SJVN focused on communication from an early stage, with close attention to consultations with project affected communities as well as enhanced disclosure and transparency mechanisms around the project and an open-door policy for affected families. Proactive strategies, such as holding training sessions for the local communities, placed SJVN at the forefront of communication processes which have been emulated in other projects in the state. The Project Information Center set up at site provided a one-stop window for project-affected communities. Relations with local media were handled proactively, which also helped manage perceptions around the project.
121. Plan as far as possible, but ensure that there is a structure in place to adapt as issues arise during the project. Due to the geological conditions, implementing hydropower projects in the Himalayas is extremely complex even with extensive preparation and identification of risks. The project would have benefitted from additional geotechnical investigations during preparation, but this would only have mitigated the risk, not removed it entirely. Difficult decisions should always be taken upfront insofar as this is possible. For example, before construction began, when an additional adit was being considered to help with excavation of the Head Race Tunnel, it was decided that this adit should be avoided as it necessitated a small number of additional families being relocated. Despite the difficulty of taking such a decision, the project would have avoided some delays if this adit had been included in the initial design instead of deciding to go ahead with it only when the rock conditions were found to be very poor. Similarly, it would have been better to have a contingency for further land to accommodate the additional muck generated by this extra adit and other excavations. However, there will always be unknown eventualities to address and the highlight of the RHP was the way in which these challenges were addressed using adaptability without leading to complex contractual difficulties.
122. It takes time to build capacity even when the willingness to raise environmental and social standards is there, but building this capacity through a project can have wider benefits for the region. GoHP has demonstrated its commitment to good international practices on social and environmental management through its policy on benefit sharing and environmental offsets, which go beyond mitigation of direct impacts. It lacks the necessary capacity, however, to implement, or cause the state government to implement these measures in full and in a timely manner, which prevented these actions from being completed within the intended time frame. Consequently, the impact of project is that the State Government has started to build this capacity and is now applying this institutional development to all projects in Himachal Pradesh, leading to a much wider impact. There is a trade-off between the instant results for the current project and building long term capacity for future projects, which needs careful balancing in set of circumstances. In this trade-off, it is necessary to ensure that the monitoring and evaluation focusses on the essential elements of the EMP rather than the elements which constitute capacity building for the region; or at least that the distinction is clear.
123. Occupational Health and Safety practices should be included in the contracts with main contractors, and contractor should be incentivized to hold their subcontractors to these standards. The RHP showed how difficult it is to reach good international practice for safety for all contractors, especially when subcontractors are local and may be accustomed to
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national practice. Effort should be made at bidding stage to include the OHS practices among the requirements for the contactors, but this alone is not sufficient. There have to be incentives and penalties in place to make it in the interest of the main contractor to manage the OHS practices of subcontractors to achieve an acceptable standard. It should also be ensured that the supervising engineers for the project have the skills to monitor and enforce such provisions.
124. Given the challenges which will occur, there need to be systems in place to ensure that other project progress continues, especially in the soft components, even when management is distracted by one area. The RHP highlighted how difficult it is to maintain focus on all components of a hydropower projects when problems occur. The major challenges with geology directly threatened the whole project. Understandably, the Client’s management, as well as the Bank team, put an emphasis on solving these problems. The Bank team, through the Aide Memoires continued in parallel to take up the implementation of soft components, such as the EMP and capacity building program, which were delayed especially during the first years when much of the geological problems emerged. The delayed response from the Client on these remarks, however, shows the limited leverage the Bank has for pushing the soft components of a hydropower when the technically and financially oriented Client has the main construction as their focus. In the face of urgent technical problems, it is difficult as a Bank team to insist on compliance for components, the benefits of which would only be realized in the distant future, without eroding the trust between the Client and the Bank. Having a structure of delegated responsibility and ‘strength in depth’ in the client management can help to ensure that all aspects of the project continue to make progress.
125. Monitoring and evaluation is difficult but crucial for complex projects. Large hydropower, like most large infrastructure projects, are multifaceted, generally include a range of sub-components and are often controversial as they may have large footprints of impact. The RHP has successfully shown that such impacts can be positive. The RHP also showed that it is easy to overlook soft components when the technical construction takes additional focus. For these reasons, monitoring and evaluation is crucial for a hydropower developer (and for the Bank) to make sure that all components are progressing as planned, and for transparency to affected people and other stakeholders. Without the baseline, mid-term and end-term impact evaluations conducted by SJVN, it is likely that many question marks would have been raised over the efficiency of the R&R program. The implementation of the environment program will, as it continues, need greater emphasis on timely monitoring and evaluation at the state level as part of their capacity development.
126. Project design can affect the level of importance attached to the softer components of the project. Designing the project with two technical components and a separate institutional strengthening component allowed the attention of the client, the government and the Bank to be focused on this aspect. SJVN were keen to develop as an organization, but had these elements been subsumed within the technical components then it would have been more difficult to monitor these aspects and bring them to the attention of management.
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7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners
127. SJVN proposed a small number of clarifying and editorial changes to the draft ICR, and they have all been implemented. No other comments or issues have been raised by the SJVN, GoI, or GoHP.
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Annex 1. Project Costs and Financing
(a) Project Cost by Component (in USD Million equivalent) Actual/Latest Appraisal Estimate Percentage of Components Estimate (USD (USD millions) Appraisal millions)
Component A – Construction of the 412 MW Rampur run-of-river 423 664.34 157% hydroelectric scheme Component B – Investment support to implement measures for ensuring higher availability of 45 * the existing upstream Nathpa Jhakri hydropower project Component C – Technical assistance for institutional reform and capacity building to assist the borrower, SJVN, in moving towards international good 10 10 100% practices in hydropower development and operations, and improving its standards of project preparation for future projects. Total Baseline Cost 478.00 674.34 141%
Physical Contingencies 43.00 0.00 -
Price Contingencies 75.00 0.00 - Total Project Costs 595.00 674.34 113% Front-end fee PPF 0.00 0.00 - Front-end fee IBRD 1.00 1.00 100% Interest during construction 74.00 22.16 30% Total Financing Required 670.00 697.50 104%
* - Works carried out by SJVN as part of internal project to improve availability of NJHP
(b) Financing Appraisal Actual/Latest Type of Estimate Estimate Percentage of Source of Funds Cofinancing (USD (USD Appraisal millions) millions) Borrower 297 297 100% International Bank for Reconstruction 400 400 100% and Development
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Annex 2. Outputs by Component
Summary
PDO part 1: To improve the reliability of India's Northern Electricity Grid through the addition of renewable, low carbon energy from the Rampur hydropower project Indicators: Rating: Satisfactory
The prime indicator for All major achievements reached already in December 2014. Most measuring the improved minor shortcomings are likely to be addressed within the next months. reliability of India’s Northern This will mean a situation in 2015 with a fully operational power plant Electricity Grid will be the at Rampur with envisaged capacity, completed resettlement, proportion of the time over environmental mitigation of direct impacts, and safety measures in which the grid frequency is place. In addition, measures have been fully achieved to decrease the maintained within the number of days with outages at NJHP, with proven results. In operating band of India’s combination the new Rampur power house and the now more reliable Electricity Grid Code. The NJHP contribute to improved reliability of India's Northern Electricity project’s capacity is small Grid. compared to the size of the northern grid so its impact will The finalization of the project suffered a 21 months delay due to be marginal, but important. greater than expected geological challenges; this was one of the main reasons for the level 2 restructuring in 2011. But even with the delay Specific Output indicators in in project outcomes, the project gives an adequate return, proven by PAD for components A and the updated economic assessment at project finalization. B: Timely and satisfactory progress toward delivery of Although major steps have already been made, there is further outputs, as planned, including uncertainty in the timing of complete fulfilment of the social benefit progress in the following sharing and regional environmental offsets for Rampur (which both go specific items: beyond compensation to affected families and mitigation of direct • Power house construction environmental impacts). The delayed components, however, only • HRT construction comprise less than 20% of the total social and environmental cost of • EMP implementation the project (less than 1% of the total project cost). Considering that • RAP/SCDP implementation these funds are committed and earmarked for activities in the local • NJHP contingency spares area that are likely to be implemented, and only comprise a small • Blanking panels and pumps fraction to the total cost, the shortcomings are considered minor.
In summary, all three main outcomes for this part of the PDO will be achieved with no shortcomings in 2015. Four out of five component- specific outputs have been fully achieved. The achievements for the two remaining outputs have almost been reached, with the remaining activities paid for and likely to be achieved but with an uncertain time schedule.
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PDO part 2: To improve the effectiveness of SJVN with respect to the preparation and safe implementation of economically, environmentally, and socially sustainable hydropower projects Indicators: Rating: Satisfactory
The improvement in The effectiveness of SJVN with respect to the preparation and safe effectiveness of SJVN will be implementation of economically, environmentally, and socially measured by the preparation sustainable hydropower projects can be judged to have been and implementation of training significantly improved. This is proved by the fact that the two outcome plans and the adoption of good targets and the six component-specific outputs are all judged to be practices in various areas, achieved, although the interpretation of the indicators and monitored including safety, financial results are not always straightforward. management, contract management, and SJVN has taken the capacity building effort seriously. They have communications. arranged a large number of training courses for its personnel, have contracted national and international expertise in key areas (such as Specific Output indicators in safety, contract management and technical aspects) and have created a PAD for component C: corporate social responsibility program. They have (as reported by Satisfactory progress toward presentations during the ICR mission) acknowledged self-criticism for delivery of outputs, as things that were not optimal, and shown great enthusiasm to adopt planned, including specific technical innovations to accelerate civil works obstructed by measures and milestones from geotechnical difficulties. SJVN have made efforts to meet varying the agreed institutional action demands from project affected people and to take actions to reduce the plans number of accidents during construction. This has resulted in a project that generally follows internationally good practice (as proven by the Aide Memoires and final ISR). In addition, SJVN has been willing to manage and solve legacy issues related to silt problems and contract claims, and expanded community development activities, for the NJHP (as reported in the mid-term and final report by SJVN).
The comparison of many key aspects (cost overrun, construction delays, number of outstanding claims, number of accidents, etc.) between Nathpa Jhakri (1994-2004) and Rampur (2007-14) show improvements in the latter project. As a sign of this improvement SJVN has been given a number of domestic awards for good practice (mainly in environmental and safety aspects).
The capacity improvement of SJVN to conduct responsible and sustainable hydropower is further proven by the fact that the company was selected, by international competition, to develop a major hydropower scheme in Nepal.
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Achievement of outcomes and outputs per component
COMPONENT 1 Target No. Target Achievement Comment description Outcome 1 Increased power No shortcomings. The project has been synchronized with the availability to Northern Grid and proven to run at its Northern region installed capacity of 412 MW on a off-takers: 1770 commercial basis in December 2014. GWh/year Total cumulative production up to 06/21/15 was 1957 GWh (the observed value in December 2014 refers to only a partial year’s production, with only partial number of units installed)
The agreed delivery with GoI from RHP for the current FY (April 2015-March 2016) is 1878 GWh, exceeding the target of 1770 GWh/year.
Outcome 2 % of time No shortcomings. From a technical perspective all large frequency in the hydropower capacity clearly improves the Northern reliability of the power grid (the opposite is Electricity Grid is logically impossible) with its unique ability in the operating to adjust its production in very short time to band of Indian control frequency. The project indicator is, Electricity Grid however, not valid for direct causal attribution Code: 72.25% to since both the criteria (operating band) and 90.3% at ICR indicator measure are dynamically changing because of other developments in the large generation and transmission system of India. The acceptable frequency band has been changed from 49.2-50.3 Hz at appraisal, to 49.90 -50.05 Hz at completion. The observed value given in final ISR (86.2%) refers to the narrower band and cannot be compared to the target of 90.3%. If the 49.2-50.3 Hz is used, the proportion of time that was recorded within the operating band in April-December 2014 was 98.9%, exceeding the target.
The contribution of Rampur, as part of the Satluj River Cascade hydropower, is confirmed as essential for frequency control of the Northern Grid by the National Load Dispatch Centre.
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Output 1 Works contracts No shortcomings The HRT was completed and functional completed (filled with acceptable seepage levels) in • Power house (% March 2014. The main power house is completion) – completed, electro-mechanical equipment Civil – installed and proven to run at full capacity in Electrical : 100% December 2014. at ICR • Head Race Tunnel (% completion) : 100% at ICR
Output 2 EMP Minor - Muck disposal almost complete by implementation shortcomings December 2014. By April 2015, plants were Muck disposal planted in all muck dumping sites, as part of as per plan: the restoration plan. Successful re-vegetation 100% at ICR tests conducted confirm re-growth within one Compensatory year. afforestation – trees: 100% at - As of December 2014, compensatory ICR afforestation covering an area of 120 ha had Funds been implemented by the H.P. State Forest utilization on Department, which comprises 86% of EMP CAT plan target. All funds deposited by SJVN with the activities: 90% State Forest Department. Will be conducted as at ICR part of overall State afforestation program. (excluding maintenance) - Rs. 185 million (82%) of 226 million utilized for CAT plan. All funds deposited by SJVN with the GoHP. Will be conducted as part of overall State programs.
Output 3 RAP and No shortcomings - Affected people resettled and/or fully community compensated for loss of land by 2007 before development plan commencement of civil works. The process implementation was conducted according to international Landowners good practice using market values for land receiving full acquisition and giving multiple options for entitlements: PAP for resettlement and rehabilitation. 100% at ICR Real increase in - Livelihood improvement of PAP indicated Project by independent impact assessment already in Affected mid-term report, and confirmed by final Families impact assessment in April 2015. 87% of standard of PAFs reported an increase in income while living the share of PAFs with an increase in income (measured and/or assets is 99%. The final evaluation also by % of PAP demonstrates an increase in literacy rates, with increased permanent housing, and size of houses. income and or
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assets): 90% at - SJVN has spent Rs. 482 million on area ICR. development fund and local welfare activities Amount spent as of December 2014. More than Rs. 300 on small million of these have been committed for infrastructure in public infrastructure and buildings (water project affected supply, transport, schools) – and Rs. 289 villages and million is confirmed as complete. local contracts Approximately Rs. 100 million, mainly for awarded to the local water supply improvements, deposited PAPs and local by SJVN with the governmental Local Area villagers: Rs. Development Fund (LADF), is still to be 200 million at implemented. ICR - A total of 119 contracts were awarded to local contractors for Rs. 337 million for the area development and welfare works. In addition the main civil works contractors for RHP assigned local sub-contracts for a value of more than Rs. 1 billion.
COMPONENT 2 Target No. Target Achievement Comment description Outcome 1 Significant No shortcomings The number of days of outage of the NJHP reduction in the has been significantly reduced to 4.6 days per number of days annum (3-year average), thus exceeding the of outage of target by far. NJHP in wet season: 32 to 24 The achievement of reduction in outages due at ICR to the project is proven by the evidence that the downward trend in outages is over and above that which could be expected from the trend in riverine sediment transport. This shows that the measures applied by SJVN during the last few years have allowed the plant to function with a lower number of outages due to silt.
Output 1 Blanking panels Indicator only Not all the outputs anticipated in the PAD and dredging partly applicable were directly achieved, but instead pumps installed since type of corresponding improved measures have been at NJHP: 100% equipment has installed and applied. During preparation and at ICR changed. early implementation of the project, SJVN Corresponding conducted a number of studies and assigned alternative outputs international expertise to find the optimal to address the solution for reaching the outcome (Outcome outcome are fully Target 3 above – reduced number of days of achieved. outage at NJHP). The final improved solution was an adaptive approach comprising a mix of
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new ideas combined with some equipment anticipated during project preparation (e.g. blanking panels). The SJVN has implemented this optimal solution and the result is that the number of days with outage at NJHP has decreased significantly, as seen by the outcome indicator above.
Output 2 Procurement of No shortcomings Approximately Rs. 555 million was invested contingency by SJVN in spares for NJHP up to 2010 (mid- spares for NJHP: term) to improve the regular maintenance of 100% at ICR turbines. Annual refurbishment (hard-coating) is now conducted for all six units during the dry season with minimum interruption of the power production. Annual scheduled maintenance outage has been reduced to 6 days for each turbine.
COMPONENT 3 Target No. Target Achievement Comment description Outcome 1 Improvement in No shortcomings SJVN reports an increase from 96.7% to off-taker 99.9% satisfaction level from 2007 to 2010 by satisfaction with mid-term, and an increase to 100% by 2014. respect to SJVN For two straight years, all of SJVNs offtakers service: Strong rated them as excellent on all 8 dimensions evidence of an listed in their satisfaction survey. upward trend
Outcome 2 Improvements No shortcomings The independent social surveys show that the demonstrated in project contributed to significant increases in social incomes, assets and other social metrics for development project affected families. The literacy rate has surveys: Strong increased from 83 to 88 percent compared to evidence of an baseline and compared to the control group, upward trend which stands at 77 percent. The number of residential rooms per house has increased from 3.7 to 6.85 compared to baseline. The value productivity of land (Rs/ha) has also increased.
Output 1 Safety action Minor SJVN has deployed safety officers to ensure plan - reduction shortcomings safety norms of the construction work, and in reported cases assigned international Occupational, Health of non- and Safety expertise to improve safety. compliance with safety procedures According to reports of the National Safety (% of prior year Advisor, the number of non-compliances fell
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value): 10% at by 39% in 2013 compared to the previous ICR year. For 2014, only data for the first two quarters was available at the time of writing, but these figures show a continued downward trend in non-compliances.
In the absence of the non-compliance statistics for earlier years, accidents rates are being used as a proxy to preliminary evaluate this output. Accident reports from construction show a clear decrease of about 15% per year from 26 in 2007 to 3 in 2014. Accident rates per year have drastically decreased (by 80%) between the construction of Nathpa Jhakri (1994-2004) and Rampur (2007-14) HPs.
Output 2 Dam safety No shortcomings Dam safety reviews have been conducted reviews carried according to Indian standards, and appropriate out to time and actions taken. The Mid-term report in 2010 follow up actions reported and information received at ICR taken: 100% at mission show 100% compliance. ICR
Output 3 Financial No shortcomings SJVN has an adequate financial management management system and internal control framework in action plan - place. The project has filed all quarterly timely and reports on time. accurate preparation of quarterly accounts: 100% at ICR
Output 4 Contract Minor With the experience from NJHP, SJVN has management shortcomings put in considerable effort to improve its action plan – contract management. The result has been that variations variation orders (VOs) have been dealt with confirmed on a timely basis during construction. At mid- through issue of term a total of 74 variation orders were priced variation verified to have been issued on time and orders: 85% at appropriately for the two main works ICR packages in contrast to NJHP where VOs were delayed for years. A Dispute Resolution Board (DRB) was established in 2008 and meets on a regular basis. In January 2015 a total of 24 claims were with the DRB, which makes the percentage of confirmed variations 76%.
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Outputs 5 Environmental Minor The Client’s report on training included 610 and 6 capacity - shortcomings person days of environmental management training (person training and 1884 person days of OHS days training): training. Earlier reports on training show
1000 days at ICR partial overlap with the aforementioned report and includes at least another 64 person days Other training of training on environmental management and including 160 person days on OHS. The client has also organizational conducted hundreds of additional person days effectiveness of other training, including leadership and (person training skills development training. Based on the days): 2000 days available documentation, however, it cannot at ICR be clearly shown that SJVN met the full target of 1000 person days of environmental management training.
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Annex 3. Economic and Financial Analysis
Financial analysis
SJVN is a stronger company, financially, than when the project was appraised. It has been listed on the stock exchange and has a wide portfolio of projects to develop (having started as a one project organization with the construction of NJHP). The company’s financial forecasts show strong performance, with an average 56% profit after tax on sales income over the next ten years. Cash flow is secure, although the extent of the company’s investment program causes a temporary negative cash flow for three years, but preceding cash reserves are sufficient to cover this loss. This cash flow difficulty is caused by the timing of the investment program; it is likely that some projects will proceed at different rates smoothing the company’s cash flow. The forecast corporate cash flow envisages some Rs. 5000 Cr6 of additional equity being contributed by the shareholders over the ten year period, particularly to finance the Luhri project. However, in the event that these injections of capital were delayed, the financial situation of the company would remain secure with positive cash flow. The company also expects to raise some Rs. 9000 Cr of debt, which, given the otherwise healthy state of its finances, should be achievable.
The specific financial performance of the Rampur hydropower scheme is uncertain until the final tariff determination is reached by the Central Electricity Regulator. However, the basis of tariff determination is “cost plus” and as a result SJVN should achieve a reasonable return on its investment depending only on how much of the cost overrun, incurred because of the geological conditions, the regulator is prepared to accept. At the mid-term review of the project (2010) it was already expected that there would be a cost increase of 30% in Rupee terms from Rs. 2047 Cr (originally agreed with GoI) to Rs. 2652 Cr. In January 2015, SJVN filed a submission to CERC, for interim approval of a tariff, showing the cost incurred as Rs. 3658 Cr (which was accepted by CERC as the basis for an interim tariff order for 85% of this amount in accordance with their rules for interim orders). Hence Rs. 3658 Cr has been used as the capital cost in the following analysis.
Rs. 3658 Cr as compared to the appraisal estimate of Rs. 2552 Cr represents an increase of 43%. In US$ terms the cost is approx. US$ 687 m; 15% higher than the appraisal estimate of US$ 596 m. These estimates are in the process of finalization and are expected to be submitted to the regulator by June 2015.
In addition, since NJHP design energy has been revised upwards by CEA, Rampur’s design energy was also changed from the 1770 MU assumed at appraisal to 1878 MU.
6 Cr stands for crore; 1 cr = 10 million
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Comparison with tariff estimates at appraisal and completion
Rupees/kWh US cents/kWh Estimated at project appraisal 2.4 5.8 Estimated at completion 3.4 5.4
A cost to completion of Rs. 3658 Cr – would imply a tariff of Rs. 3.4 which would provide a financial profit after tax of 30% on sales income or Return on Equity of 16.5% (as per the CERC norm). This price would be within the range of merit order dispatch for the Northern Region. Uttar Pradesh, for example, has an average cost of power purchase of Rs. 3.49 /kWh for 2014-15 including power purchases from NJHP at Rs. 2.76/kWh, Karcham Wangtoo (another Satluj river hydro) at Rs. 3.77/KWh and other thermal and hydro plants ranging up to almost Rs. 6/kWh. Similarly Haryana state has an average cost of power purchase of Rs. 3.6 /kWh. CERC’s annual report on the power market for 2013/14 also shows that bilateral trade contracts were conducted at an average peak price of power of Rs. 4.41/kWh and at an average off-peak price of power of Rs. 3.85/kWh. Thus it is clear that Rampur will fall with the merit order dispatch.
However, it is important also to consider the combination with Nathpa Jhakri as Rampur cannot operate independently. If both stations are considered as one joint operation, then the profit on sales from their combined operation is expected to be 40%. Nathpa Jhakri has a current price per unit of Rs. 2.76/kWh – thus the blended price for all units from the combined plant would be Rs. 2.9/kWh which underscores the fact that there is no risk of the cascade not being dispatched.
The prevailing CERC norms for tariff calculation are as follows – and these have been used in calculating the estimates above: - Debt-Equity ratio of 70:30; Interest on debt as per actual costs incurred; Return on Equity at 16.5 percent p.a. (adjusted for the current tax rate to 20.4%); Initial operations and maintenance expenses at 2.5 percent of the project cost , escalated at 6.44 percent p.a.; Depreciation on straight line basis (as per rates prescribed by CERC), up to 90 percent of project cost (excluding land). After 12 years of operation the rate of depreciation adjusts to the remaining useful life of the project; Working capital requirement calculated from operations and maintenance expenses for one month, maintenance spares and receivables for two months Working capital and short-term loans interest rate at 12 percent p.a.; operations and maintenance expenses calculated at 2.5% of project costs, escalated at 6.64% pa; Design energy for RHP at 1878 million units; Effective tax rate 20.96% as per NJHP current rate 13% free power to the state.
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Economic analysis
According to the project appraisal document, the economic rate of return was expected to be 19.3%, assuming operation began in 2011. This compares with a rate of 14.1% calculated on the final cost to completion (the calculation of which is described below).
The economic analysis carried out at appraisal (which was exhaustive) was recalculated in line with the revised cost to completion and the additional time taken for the project. At appraisal it was expected that Rampur would reduce peak power shortages and thus obviate the need for additional gas stations. Similarly, it was assumed that during the wet season when Rampur can provide base load, it would displace the need for additional gas fired generation.
In the Northern region to which Rampur contributes, in 2013/14 there was a 5% shortage of power based on average daily consumption and a 7% shortage for peak power. This implies that at some points of the year, in off peak, there may be times when there is sufficient power supply available and consequently the use of Rampur’s power will imply backing down an alternative power station (rather than obviating the need to build an additional station). There are a range of power trading possibilities now available in India, which were only just beginning to be established when this project was appraised. Thus the avoided cost of power purchase as set by the market can be used to value the new generation provided by Rampur.
According to the CERC, in 2013/14 more than 10% of power was purchased through short term contracts including bilateral trades, exchange markets and unscheduled interchange and of this more than 30% was by bilateral trade. The average price for off-peak power traded bilaterally was Rs. 3.845 which compares favorably with the variable cost of electricity at the limit of the merit order in Uttar Pradesh, for example, which was Rs. 4.62/kWh and the approved cost at which the state is permitted to buy power in an emergency using the trading markets or unscheduled interchange is Rs. 5 /kWh (according to the latest UPERC tariff order). The equivalent price of bilateral trade for peak power is Rs. 4.41/kWh and for off peak power is Rs3.85/kWh. The ERR of 14.1% valued at this bilateral trade price for the project is 17.1% if recalculated at an avoided cost of Rs. 5/kWh. The use of the price of power generation avoided (bilateral trade price) is a conservative one, since there remain times of shortage even during off-peak times when Rampur could be said to be replacing more expensive diesel back up supply or even un-served energy.
If environmental benefits of avoided carbon are included, then the ERR at appraisal was only 0.5% higher than the rate excluding such benefits as the assumption was that the avoided generation was based on gas which is a lower carbon emission source than coal. Rampur has since been approved for carbon emission reduction credits (guaranteed 740,000 pa). If this is included valued in line with World Bank recommended norms – then the ERR changes to 16.6%. The ERR could be higher if the additional optional CERs (up to 1,400,000 pa) are included taking the return to 18.5%.
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Annex 4. Bank Lending and Implementation Support/Supervision Processes
(a) Task Team members Names Title Unit Lending Sunil Kumar Khosla Team Leader / Sr. Energy Specialist SASSD Judith K. Plummer Co – team leader/ Sr. Financial Analyst SASSD Alessandro Palmieri Lead Dam Specialist ESDQC I.U.B. Reddy Sr. Social Development Specialist SASSD Tapas Paul Sr. Environmental Specialist SASSD Manmohan Singh Bajaj Sr. Procurement Specialist SARPS Sushil Bahl Sr. Procurement Specialist SARPS Manoj Jain Sr. Financial Management Specialist SARFM Sumir Lal Sr. External Affairs Officer SAREX Sudip Mozumder Sr. Communication Officer SAREX Rohit Mittal Financial Analyst SASSD Joseph Daniel Wright Economist SASSD Boonsri Prasertwaree Kim Program Assistant SASSD Deepali Uppal Program Assistant SASSD Ritu Sharma Program Assistant SASSD Anthony E. Sparkes Consultant SASSD Ashok Malik Consultant SAREX Ramola Bhuyan Consultant SAREX Sona Thakur Consultant SAREX Peter S. Copplestone Consultant SASSD Naseer A Rana Adviser SARSQ Supervision/ICR Rohit Mittal Team leader/ Senior Energy Specialist GEEDR Kwawu Mensan Gaba Co-team leader / Lead Energy Specialist GEEDR Harinath Sesha Appalarajugari Senior Environmental Specialist GENDR Sushil Kumar Bahl Senior Procurement Specialist SARPS - HIS Manmohan Singh Bajaj Senior Procurement Specialist SARPS - HIS Shanker Lal Senior Procurement Specialist GGODR Sheela Bajaj Consultant GEEDR Luiz Augosto Nobrega Barroso Consultant GEEDR Ramola Bhuyan Consultant CCLSI Peter S. Copplestone Consultant SASSD-HIS Jean Michel Devernay Chief Technical Specialist TWIWA-HIS Pyush Dogra Sr. Environmental Spec. GENDR Daryl Fields Sr. Water Resources Spec. GWADR Surbhi Goyal Energy Specialist GEEDR Anupam Joshi Sr. Environmental Spec. GENDR Manoj Jain Lead Financial Management Spec GGODR Pravin Karki Senior Hydropower Specialist GEEDR Ashish Khanna Lead Energy Specialist GEEDR
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Sunil Kumar Khosla Lead Energy Specialist GEEDR Rikard Liden Senior Hydropower Specialist GWADR Kimberly Nicole Lyon Consultant GWADR Boonsri Prasertwaree Kim Program Assistant GEEDR Oeyvind Espeseth Lier Senior Hydropower Specialist TWIWA - HIS Alessandro Palmieri Consultant GWADR Tapas Paul Senior Environmental Specialist GENDR Judith K. Plummer Consultant GEEDR I. U. B. Reddy Senior Social Development Spec GSURR Vaideeswaran Sankaran Consultant GENDR Peeyush Ramawtar Sekhsaria Consultant GSURR Varun Singh Senior Social Development Spec GFADR Anthony E. Sparkes Consultant SASDE - HIS Sona Thakur Senior Communications Officer SAREC Deepali Uppal Program Assistant SACIN
(b) Staff Time and Cost Staff Time and Cost (Bank Budget Only) Stage of Project Cycle USD Thousands (including travel No. of staff weeks and consultant costs) Lending FY05 9.96 39.53 FY06 78.09 260.87 FY07 61.68 204.59 FY08 14.31 79.53
Total: 164.04 584.52 Supervision/ICR FY08 36.53 208.11 FY09 51.77 203.70 FY10 47.21 178.14 FY11 56.11 167.64 FY12 39.72 125.66 FY13 30.64 129.64 FY14 25.53 139.67 FY15 14.99 81.22
Total: 302.50 1,233.78
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Annex 5. Beneficiary Survey Results
Introduction The Rampur Hydropower Project (RHP) has been constructed on the right bank of river Satluj in district Kullu near to Rampur town. The land has been acquired from the four revenue villages of Bayal, Koyal, Averi and Duttnagar for the construction of project infrastructure and other activities. A total of 100 ha of land were acquired/diverted from forest land for project activities, including 29 ha privately owned by 167 landowners. A total of 19 PAFs were displaced due to acquisition of houses; 10 PAFs were affected by acquisition of their houses but had second houses; and 57 PAFs were rendered landless. In order to mitigate any adverse impacts on the livelihoods and other aspects of the social and economic fabric of these villages, SJVN implemented a Resettlement & Rehabilitation plan for project affected families (PAFs) along with various community development initiatives. The main provisions envisaged in the R&R Plan for the PAFs are house plots for houseless families, rehabilitation grants for landless families, support for income generation, health care services, education facilities, technical education for capacity building, drinking water, and infrastructure works in the area etc. A study examining the efficacy of these measures was carried out post-completion by the Agro- Economic Research Centre, Himachal Pradesh University. This summary highlights the main findings from their report, which was finalized in March 2015. This follows a baseline survey conducted in 2005 and a mid-term impact evaluation in 2010. Objectives and Methodology The main objective of the study is to evaluate the final impact of R&R activities on PAFs. This has been done by comparing the current values of relevant parameters with results from the base line study (2005) and also with the control sample. The 92 PAFs residing in the four villages affected by land acquisition were surveyed along with a control sample of 80 households located in the same four villages as well as the villages Brow and Randal. In addition to household survey, the study also relies on focused group discussions with village leaders, Panchayat officials and other key stakeholders. The data was collected during the period December 29, 2014 to January 4, 2015 by team of seven experienced field investigators. The main areas of impact analysis are:
i. Occupational pattern of the PAFs. ii. Residential pattern of the PAFs. iii. Agricultural/commercial assets of the PAFs. iv. Possession of house hold’s durables by the PAFs. v. Livestock assets of the PAFs. vi. Farm yield of the PAFs. vii. Consumption pattern of the PAFs. viii. Investment pattern of the PAFs. ix. Socio- political and religious institution in the project area. x. Cultural Practices in the project area. xi. Infrastructural development in the project area.
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The scope of the study also includes identification of the key outstanding implementation actions and proposes any remedial measures that are necessary to achieve the intended objectives of R&R and community development activities.
Table- 1: Classification of sampled households
Village PAFs Control Sample Total Bayal 62 3 65 Koyal 22 18 40 Averi 1 11 12 Duttnagar 6 17 23 Brow - 1 1 Randal 1 30 31 Total 92 80 172
Socio-Economic Impact of R&R Interventions Demographics There are no significant changes in the demographic profile of the sample, the percentage of male being about 51 per cent during current evaluation as compare to about 49 per cent during base period. Family size and sex ratio declined in the current period when compared to base year (Fig-1 and 2). The dependency ratio increased marginally to 0.67 from 0.66, but this compares favorably to the control sample, which has a dependency ratio of 1.16.
Fig-1: Changes in family size in project Fig-2: Changes in sex ratio in project area (persons/family) area (females/1000 males)
1037 4.55 4.5 1013 4.21 922
Education There is an appreciable increase in the percentage of persons with qualification of Senior Secondary level and above. As such, the literacy level among males has increased from 91 per cent to 92.14 per cent and that of females has increased from 76 in the base period to 83 per cent (Fig-3).
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Fig- 3: Changes in literacy in project area (%)
2014 2005 Control
92 88 91 83 83 85 76 77 69
Male Female Total
Occupations Agriculture is the main occupation of workers. The percentage of male workers engaged in agriculture declined by about 3 per cent whereas the percentage of female workers increased from about 71 percent to 92 percent. This scenario is the result of alternate and comparatively higher paying job opportunities made available, mainly by the RHP. Women had to compensate the labor requirements by working on farms. About 3 percent of workers were working as agriculture labor, but now this occupation is completely absent. The percentage of workers engaged in non-agriculture labor, service, business and rural artisans witnessed an increase during the evaluation period (Fig- 4).
Fig- 4: Changes in Occupation pattern of workers in project area (% of workers)
2014 2005 Control
66 60 48 26 20 19 16 5 4 9 6 6
Agriculture Non-agril Service Business labour
Changes in income Patterns Agriculture still remained main source of income for majority of households but the percentage of such households declined from about 90 percent to 63 percent. The percentage of households deriving income from wage labor decline significantly from about 41 percent to 10 percent.
Level of Income The per-household income from service witnessed an increase of about 229 per cent whereas this increase was 163 percent for agriculture and 596 percent for business. The income from wage labor declined by about 422 percent during this period. In real terms, annual income was
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2.5 lakh per household in base period, which has increased to 3.9 lakh in 2014 (Fig-5). The current income in absolute terms has gone up from Rs. 120648 per HH/year during base period. This figure for control group was Rs 207257 per household per year. This, in absolute terms, is 222.61 per cent higher as compared with base line period and 87.80 per cent in comparison to control group. However, if base line household income is inflated to current prices, the increase in income, in real terms, is about 55 per cent.
Fig- 5: Changes in Level of annual income in project area (Rs/hh)
389218
251472 207257
2014 2005 Control
Changes in Housing conditions All the sampled households had houses during the current survey but during the base period only 95 percent households owned the houses. There is significant improvement in the type of houses as the percentage of households having pukka houses was about 98 percent during current period in comparison to only about 35 percent households having pukka houses during base period. All the sampled households now had separate kitchen and toilet, during base period only about 79 and 68 percent households had these amenities. About 80 percent of the households now had separate animal shed whereas about 71 percent households had separate animal sheds during the year 2005. The average number of residential rooms per household has increased during the period under study.
Changes land ownership and cropping patterns
Land ownership. Per household land with sampled households during current survey average at 0.45 hectare which declined from 0.83 hectare during the year 2005. The per-household land holding with control sampled was still smaller at 0.30 hectare. This indicated that the average land holding declined by about 46 percent over the year 2005. This decline was about 48 percent in case of agriculture land and 43 per cent in case of horticultural land.
Cropping Patten: There has been a change in number of households cultivating different crops. The table 3.19 indicates that percentage of households cultivating maize declined from about 29 percent during the year 2005 to 15 percent during current survey. Similar declined was observed in case of wheat also the respective figures being about 72 and 64 percent. The percentage of households cultivating paddy remained almost constant at about 64 percent. There was significant declined in percentage of households cultivating different vegetables. It is also indicated that larger number of households have opted cultivation of apples and pears instead of almonds.
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The total cropped area, per household, was 0.63 hectare a decline of about 47 per cent in comparison to base year. There was significant decline in areas under crops like maize, paddy, wheat and barley. The area under pulses and vegetables formed a negligible proportion in aggregate cropping pattern during current survey. The analysis reveals that the yield of wheat and paddy on PAFs has increased while it was stagnant in case of maize. The level of yield of major crops is presented in Fig-6.
Fig- 6: Changes in productivity of major crops in project area (kg/ ha)
2014 2005 Control 3495 3137 3150 2632 1792 1900 1900 1460 1750
Yield of wheat Yield of maize Yield of paddy
Crop Production pattern. The value of crops output has increased from 1.21 lakh per hectare in base year to 2.42 lakh per hectares in current period.
Table 2: Changes in Socio Economic Key indicators No Indicator Baseline Current Controlled ( 2005) ( 2014) ( 2014) N=143 N=92 N= 80
1 Literacy Level (%) 83.00 88.00 77.00 2 Proportion of Wage labor (%) 4.32 4.65 20.22 3 Proportion of those in business % 5.60 8.96 6.01 4 Proportion of those in service % 15.52 19.35 26.32 5 Average annual Income at current levels (Rs.) 2,51,472 3,87,204 2,07,257 6 % of families earning more income than baseline at NA 87.00* NA current level (%) 7 Average house size ( is sq.ft) 578 985 358 8 % of household living in Pukka houses 35.00 98.00 69.00 9 % of families having separate Kitchens 79.00 100.00 73.00 10 % of families having separate toilet 68.00 100.0 62.00 11 % families having TV 72.00 100.00 81.00 12 % families owning Refrigerator 46.00 100.00 54.00 13 % families using LPG 82.00 95.00 80.00 14 % families own four wheeler 12.03 42.00 12.50 15 Average Land holding ( ha) 0.83 0.45 0.30 16 Average number of livestock 2.37 1.46 1.43 17 Consumption of food item in Rs/year (at current prices) 5,302 6,116 5,150 18 Consumption of non-food items in Rs/year (at current 2,473 3,572 2,575 prices)
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Women’s Empowerment
Mainstreaming of women is an important aspect in community development activities for ensuring their participation in socioeconomic upliftment of project affected population. RHP has focused on this aspect and tried to include as many women in the training and other programs. The analysis indicates that about 16 percent of the persons sponsored for technical education courses were women and of the persons who completed these courses about 14 percent were women. The position of women in respect of number of persons given apprentice training though was not very good as they were only about 14 percent of the total persons receiving such training, it is a significant beginning. Women were able to corner 29 percent of the scholarships. No registered women contractor were available and hence no work could be awarded to them under petty contracts indicating a need of concerted efforts in enabling women to venture in this field. The contractors were not very fair in hiring the women work force as only about 9 percent of their total work force was of women. The main reason forwarded in defense was that the nature of work (working in tunnels and works requiring heavy physical efforts) discouraged the women to take up these assignments. This is also reflected in the number of days of employment under contractors; of the total work days, about 14 percent were contributed by women. It is apparent from the analysis that women could not avail the benefits of various schemes of RHP to desired level; present initiative is a welcome intervention in women empowerment. The detailed trade wise analysis indicates that women have made a desired beginning in availing the benefits. The women were sponsored for two trades: COPA and cutting & sewing. Thus, 31 women were sponsored under technical education of which 25 completed their trainings and 11 were also successful in getting employment. This, of course, is a healthy beginning. Two out of four professional staff (50%) working on community development and resettlement and rehabilitation aspects are females and the head of the public information center (PIC) is also a female. In addition, the project provided a regular employment to a female pharmacist at Bayal dispensary under the resettlement and rehabilitation scheme.
Post Commissioning support During the post commissioning stage, the project affected families will receive 100 units of electricity per month for 10 years and the long term residents in the affected villagers will receive annuity payment out of revenue generated out of sale of 1% free power provided to the State Government by project entity during life of the project. The RHP is finalizing the modalities for extending the electricity supply and the State Government in the process of finalizing the list of eligible people for annuity payments. Thus, there is a sustainable efforts from the project entity and State Government to support the project affected and local people beyond the project implementation.
Impact of Community Development Activities Various developmental activities aimed at socioeconomic development of the project affected area and population, have been carried out by RHP. The focus of these activities is the infrastructural development and have been initiated depending upon the relevance, demand and requirements. These have been presented in following text.
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Status of community development works A total number of 28 community development works were taken up by RHP which have been completed. In order to execute these works a total expenditure of Rs.204.77 lakhs have been spent. Before the commencement of LADA, various community development works were undertaken by RHP. A total sum of Rs. 142.77 lacs were spent on 27 such works pertaining to construction of pukka paths, kuhls, street lighting, playground and footbridge etc. Another sum of Rs. 2149.27 lacs were spent by RHP on five other works of construction of steel bridges in Jhakri and Bayal panchayats, boxing ring at Rampur College, road and hospital at Bayal.
After the formation of LADA, 32 works of pukka paths were completed at the total cost of Rs. 113.03 lacs in district Kullu. Other works completed in district Kullu include three works of kuhl construction in Gadej panchayat at the cost of Rs. 13.42 lacs, four works of retaining & boundary wall at Bari, Tunan and Gadej panchayats at a cost of Rs. 9.89 lacs. Five works of playground and fencing etc. were completed at a cost of Rs. 16.0 lacs at Bari, Bahawa, Kharga and Tunan panchayats. Road work was constructed at Bahawa panchayats at a cost of Rs. 5.0 lacs. Rs. 7.0 lacs were spent on three works of drinking water lines and tanks in panchayat Bahawa and Tunan. Twelve works of construction and repair of buildings and temples were completed in district Kullu at the cost of Rs. 52.30 lacs and three foot bridges were constructed in Gadej, Kushwa and Tunan panchayats at an aggregate cost of Rs. 89.71 lacs. In total 64 such community development works were completed at a total cost of Rs. 312.97 lacs in district Kullu.
In district Shimla, after the formation of LADA, 22 development works were completed at a total cost of Rs.63.00 lacs. These include 8 works of construction of pukka path, 6 works of construction of fencing and playground two works each of repair of temple and construction of roads. In addition, one works each of construction of rooms, drainage, breast wall and community bhawan were also completed.
Impact of community development works The basic objective of undertaking the community development works is to provide various amenities/facilities to the project affected population, which is bound to have positive social and economic benefits. The present analysis has been carried out in order to evaluate this impact and to document the problems reported by the end users and suggestions made by them for further streamlining these efforts and to increase their efficacy. As the community development works are of different types they have been evaluated separately and present below.
Health Impact: The main work under this activity was construction of hospital aimed at providing health facilities almost at the doorstep of project affected population with perceived benefits of easy consultations and free medicines etc. The social impact of this activity, as reported by the respondents was in the form of better health, low illness periods and generating a sense of overall wellbeing. On the economic side of it, it was reported that the work efficiency of workers has improved. No problem in this regard was reported.
Drinking water: Improvement in existing and provision of new pipe lines and storage tanks were the main activities aimed at improving the existing water supply for improving the water availability. The social impact of this activity has been some improvement in living standards and on economic side benefits like time saving, reduction in incidence of water borne diseases and most importantly, reduction in drudgery faced by women have been reported.
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Sanitation: The distribution of toilet seats and other materials were the activity components aimed at improving the sanitary conditions and to inculcate the habit of cleanliness with the perceived benefits of clean surroundings and there by bringing about improvement in the health conditions. As a result of this activity there has been some improvement in the habit of cleanliness and there has also been some improvement in the sanitary conditions. This has also been able to save the time and to some extent reduce the incidence of diseases.
Street lighting: Street lighting has been provided in village Bayal with a purpose of ensuring easy and safe movement during night hours and to have some protection against crime. This has also made possible to have longer working hour.
Connectivity: In order to ensure easy and safe movement of persons and goods, foot paths and foot bridges have been constructed. This has resulted in efficient transportation of goods and farm produce lowering the transportation cost. Though, no problems were reported.
Community Centre: Community centers were constructed to facilitate the public meetings and provide platform for community interactions. This could also be used for public functions and family celebrations. This has not only improved the status of village but has facilitated the social interactions leading to formulation of strategies for taking care of development issues and providing useful hints about latest farm production technologies.
Mahila and Yuvak Mandal buildings: The purpose of constructing these building was overall development of women and youth of the area. It was perceived that this institution will make possible the introduction of various income generation activities and they will be able to have constructive use of their free time. This has been able to develop as meeting point where exchange of ideas and information has been possible and the trainings and demonstrations are also facilitated. But for all these, lack of funds was reported to be a bottleneck.
Irrigation: Irrigation is an important input for improving the crop productivity and hence the activity of construction and repair of kuhls was undertaken to reduce irrigation water losses. This has not only been able to shift the cropping pattern towards high pay off cash crops but ensured the crop productivity also. This has led to some improvement in living standards of beneficiary farmers. It was suggested that new water sources should be tapped to improve the irrigation water supply to existing areas and to make it possible to include other un-irrigated areas.
Temples: Respecting the religious sentiments of villagers, construction/ repair/improvement of temples was undertaken. This activity resulted in better aesthetics and long life of temples. This greatly satisfied the religious sentiments, people wanted more temples to be covered under this scheme.
Playgrounds: This activity included construction, improvements and/or fencing. This was aimed at promotion of sports in the area and villagers were greatly satisfied with this activity which would result in healthy and efficient workers, better equipped schools and hence better performance in tournaments. People had no problems with creation of this infrastructure but wanted simultaneous provision of sport kits and other equipment.
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Conclusions The data collected from the sample PAFs clearly shows that the overall living standard of the families has improved due to RHP project implementation. Following changes are noteworthy. a) There is improvement in level of education and literacy rate among PAFs. The literacy level among males has increased from 91 per cent to 92.14 per cent whereas in case of females it has increased from 76 to 83 per cent from base period, the technical educational schemes implemented by RHP have attracted PAFs and number of technical educated persons increased in current year. Merit scholarship was provided to nine persons belonging to PAF and 79 of PAA. b) There has been increase in full-time employment in the villages due to RHP activities. Encouraged by RHP, the contractors working with it also employ local workers as much as possible. Permanent employment was provided to one member of project affected family and in addition to that employment has been provided 425 persons through contractors of RHP. c) There is significant increase in the proportion of workers in the regular employment, with public and private sector. About 19 per cent persons were working as private and government servants, an increase of about 25 per cent over 2005 and 26 per cent higher in comparison to control group. d) Diversification of income and employment avenues through various technical education, training, income generation schemes, towards business and other self-employment activities, is taking place. e) There have been positive impacts on income and employment pattern of project affected families. During the base line period, main occupation was agriculture with 59.80 per cent workers reporting it, which figure increased to 66.31 per cent during the current survey, an increase of about 11 per cent. The increase in number of persons reporting agriculture as main occupation is the fact that more stress is now given on fruit and vegetable cultivation which are labor intensive ventures. f) The current income in absolute terms has gone up from Rs. 120648 per HH/year during base period to Rs. 389218 currently. This figure for control group was Rs 207257 per household per year. This, in absolute terms, is 222.61 per cent higher as compared with base line period and 87.80 per cent in comparison to control group. However, if base line household income is inflated to current level, the increase in income, in real terms, is about 55 per cent. g) There is improvement in the residential facilities of the affected families as compared to their own earlier situation and as compared to the condition of non-affected families in the project area. The number of pukka houses increased by 180 percent over the base period and the percentage of houses having separate kitchen and toilet increased by about 27 and 47 per cent respectively over base period and 89 and 61 per cent respectively in comparison to control sample. h) There has been improvement in living of standards of PAFs and number of households having modern durables such as TV, refrigerator, LPG connection by about 17, 50 and 19 per cent in comparison to control sample households having these durables.
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i) There has been improvement in consumption pattern (towards more nutrition, protein, fruits & vegetables) of the project affected families. The consumption expenditure of food items is 15.35 per cent over base year and there is simultaneous increase of about 44 per cent in the consumption of non-food items. j) The land holding has declined but the yield of major crops on PAFs farms increased and value productivity of land was significantly (100%) higher in current year as compared to base year.
k) Compensation rates given to the PAFs were adequate. PAFs received full compensation from RHP. During final evaluation 18 percent of households had invested in land purchase, 62 per cent households making investments in the form of fixed deposits in banks and Mutual funds. l) The RHP has taken measures to strengthen the existing infrastructure facilities, including health facilities and education, irrigation, drinking water, sanitation, street lights and roads which are providing immense benefits to the PAFs in the project area. RHP has undertaken and completed seven different works of distribution of toilet seats and essential materials to the residents of Project affected panchayats. There were 79 works completed by LADA and 47 road/pukka path related works. A total expenditure of Rs. 3071 lakh was made on these works.
People’s Perceptions. The project affected population has been exposed to variety of people due to influx of workers, significantly impacting their social, cultural and economic life. The people have become greatly aware of the development scenario and now have a positive outlook towards development interventions like R&R activities. The people now understand the importance of education for securing the future of their wards. More and more people now have commercial considerations in agricultural production which in future will help them in providing secure and sustainable livelihoods. Political awareness has significantly increased and political forum are increasingly taken as a platform of grievances redressal. The public opinion was quite favorable in respect of facilities like provision of merit scholarships, improvement in conditions of schools, assistance to yuvak and mahila mandals etc. The training and awareness camps have been an effective tool for capacity building of PAP and also to make them aware about new opportunities in income generation or to improve upon the existing livelihood strategies.
Impact of R&R and community Development Works. The implementation of majority of R&R components have largely progressed as per laid down time schedule. However, some of the development works were delayed after the transfer of works to LADC. The SCDP activities like foot bridges, village paths, provision of drinking water etc. have made PAFs life better. The support services like farmers’ training camps have been appreciated and demanded for income generation activities. The dissent to decisions and policies of R&R, often are not genuine and are due to political influence and raised aspirations of PAF. In the light of above it is indicated that R&R and LADC have been able to fulfill their objectives to a large extent. Despite this, a few suggestions have emerged for making the LADC more effective. It was suggested that the frequency of LADC meeting should be increased so that all the agenda items are discussed in depth and there should be review of actions taken and progressed achieved. Many people wanted that they should be a fixed time limit for execution of LADC decisions. This will help in avoiding cost overruns and achieving the PAPs satisfaction. It was also
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suggested that LADC should have greater focus on income generation activities including introduction of new activities and sharpening the skills for ongoing activities.
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Annex 6. Environmental Management of the Rampur Hydropower Project
Environmental Context The Rampur hydropower project is located on the River Satluj, near the town of Rampur in the Shimla and Kullu districts of Himachal Pradesh. The catchment area of the River Satluj at Rampur is approximately 50,800 km2 (49,800 km2 at Nathpa Dam), of which about 30 percent falls in India and the remaining in China. The project area and the project’s influence area are located in the lower Himalayas, and is characterized by rugged topography with steep hills (altitude varying from 850m to 2000m). The area experiences subtropical to sub-Himalayan climate and is sparsely vegetated. The immediate vicinity of the project supports patches of dense forests, but has a long history of deforestation. The hill slopes are steep, and are generally covered with sparse vegetation, over burden and outwash material. Most of the human population in the project’s influence area is concentrated in the villages along the highway and the connecting district roads. Owing to historical reasons combined with the natural setting, areas around the Rampur project have relatively poor forest cover or biodiversity. The project is located by the side of a major transportation route (National Highway 22A), and in the midst of a number of traditional settlements including the major town of Rampur. The steep rocky slopes by the deep gorges of the River Satluj and its tributaries do not support good forests. There is no reserve forest and only 12 patches of protected forests within the project’s influence area (defined as an area 7 km around the project). The protected forests (about 20 km2) overall occupy about 8 percent of the project’s influence area. The closest of the protected forest patches, the Baruni Protected Forest is located about 750 m away from the project; all others are more than 2-3 km away. Of all the protected areas of the state (national parks and wildlife sanctuaries) none is located within the project’s influence area, and the closest one – the Rupi-Bhava Wildlife Sanctuary – is located 13 km away from the project.
Consultation and clearance The project engaged with stakeholders including the project-affected people to discuss different aspects of the project. SJVN organized community meetings, meetings with village elders and elected leaders of the villages. During the preparation of EA and social assessments, a number of informal but significant meetings were organized. As part of the regulatory clearance process, a formal public hearing was organized. At Bael village, a public information center (PIC) was set up in December 2005, where the local community and any other stakeholders have full access, and this PIC has been helpful for the local public in recording their views about the project. A final round of meetings to disseminate the final versions of these safeguard documents was held at PIC in Bael village on March 30, 2007 and was attended was more than 200 people. The Rampur hydropower project was classified as a Category A operation under the World Bank environmental screening procedures specified in operational policy 4.01. The project triggered six of the ten World Bank safeguard policies 7/ and required comprehensive
7/ These six World Bank Safeguard Policies are those on - Environmental Assessment (OP/BP 4.01), Forests (OP/BP 4.36), Cultural Property (OPN 11.03), Involuntary Resettlement (OP/BP 4.12), Safety of Dams (OP/BP 4.37), and Projects on International Waterways (OP/BP 7.50).
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environmental assessments. The initial EIA, background studies and plans were integrated into a consolidated environmental assessment and environmental management plan (EA/EMP). The project obtained the three-stage environmental clearance from the Ministry of Environment and Forests, GoI (MoE&F) and did not require any regulatory clearance under the GoI Ancient Sites and Remains Act, as it does not impact, directly or indirectly any known or notified cultural heritage resource. The State Department of Culture had also provided no- objection to the project on the basis that no cultural property is impacted by the project.
Environmental impacts and management plan The impact of the project on the existing landscape, at the basin or even a district level is very small, owing to the environmental setting of the projects and the fact that it is a run-of-river scheme in a cascade with the upstream NJHP and requires no dam. Impacts on land and forests: The project acquired 48.9 hectares of degraded forest land (with very little forest or tree cover), and notionally acquires (but does not disturb – as the works are deep underground) another 20.47 hectares of similar degraded forest land over the tunnels. Together these represent 0.07 percent of the total forest area of Rampur and Anni forest divisions (which together have 90,596 hectares of legally defined forests). The diversity of the land parcels was also low. The EMP for Rampur related to impacts on land and forests was therefore, to a large extent, based on standardized offsets as guided by GoI and GoHP policies rather than the direct environmental impacts. Despite a direct affected area of only 0.865 km2, the compensatory afforestation and CAT plans were based on a standardized defined area of 154 km2 (7 km radius). A compensatory afforestation (CA) plan was designed to be implemented by the State Forest Department. The CA was planned on 139 hectares as per the Forests (Conservation) Act 1980 in Arsu and Nichar ranges of Ani forest division. In addition, a catchment area treatment (CAT) plan was formulated with the objective to mitigate sediment load into rivers and to protect the watersheds in the region and, as per the directives of the GoHP. It covers measures regarding area treatment, soil conservation, and improvement of degraded forest areas within the project catchment. The measures by the project included payment of net present value of forests of about US$10 million (to generate forests of equivalent area elsewhere in the project’s influence area), and a catchment area treatment plan, costing US$ 5.3 million. Construction impacts: There were expected to be indirect impacts of the various construction activities such as: (i) generation of dust due to earthwork, excavation, transportation of construction materials (sand, aggregate, cement etc.), quarry, crusher and blasting operations; (ii) air pollution due to movement of construction vehicles, equipment and machinery; (iii) influx of laborers; and (iv) pollution generated through provision of labor camps established temporarily at construction sites etc. The identified impacts of the construction also included potential disturbance to forests and wildlife by construction laborers, and generation of muck and debris from underground work. The EMP included action plans to minimize these effects. The management of construction-related impacts was the responsibility of SJVN (through its contractors, as and where relevant, and as described in the EMP). The plans for managing the construction site impacts included: (i) plans and guidelines for managing and restoring the muck disposal sites; (ii) management and reinstatement of the quarries; (iii) management of
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effluent discharge; (iv) management of safety and health issues; and (v) a chance find procedures for the conservation of cultural properties. Impacts on river flows: As Rampur reuses water from NJHP, the only change in the river flow occurs between the intake works at Jhakri (where the Nathpa Jhakri tailrace water enters the River Satluj), and the tailrace outlet at Bael village. At Jhakri, the current flow of the river is constituted by (i) the water from Nathpa Jhakri tailrace, and (ii) the combined flow of all tributaries joining the River Satluj between the Nathpa dam and Jhakri (except a stream called Sholding, where six cumec of water is diverted to augment the Nathpa Jhakri lean season peaking power generation). The project uses all the water coming from the Nathpa Jhakri tailrace, but does not use any of the water coming through the tributaries. The instream flow provided at NJHP (release from dam) together with the additional water coming from tributaries it more than sufficient to meet the GoHP regulatory guidelines for in-stream flow requirements. Impacts on fish and wildlife: No fish were reported in the River Satluj in the project area during the surveys of 1998, 2004 and 2006. However, fish were monitored in the side streams particularly Nogli Khad, Sumej Khad and Kajo Khad, near their confluences with River Satluj. These side streams have less flow instability, favorable temperature and less turbidity than the main River Satluj. Since the Rampur project only affects the river flow in Satluj between the NJHP and Rampur power stations, it thus has no direct impact on fish. Only four species of wildlife were reported from the project’s influence area in the ESIA. No endangered, rare or protected species was found from the project’s immediate influenced area or the directly affected area. Similar to the forest components, the EMP related to fish and wildlife was therefore not linked to the project’s direct impacts, but was guided by the GoHP policies. The project EMP included the support (Rs.10 million) to the GoHP program for development of fisheries in the state; a supplementary stocking program for snow trout done annually by the fisheries department. Similarly, for the wildlife enhancement in the region, the EMP included (Rs. 6.25 million) to the GoHP program for conservation of wildlife. Impacts on water quality: The high dissolved oxygen (DO) levels in the river before the project indicated high water quality in the project area. The level of biochemical and chemical oxygen demand (BOD and COD) were very low, which indicates the absence of organic pollution loading. This is mainly due to low population density, low agro-chemical dosing and the absence of industries in the area. Water quality in terms of pathogenic bacteria appears to be good except immediately downstream of Rampur town during the lean flow season. Rampur, which is the only town in the project area, has a sewerage scheme that at the time of preparation was only partially operating, and being repaired. In light of the above, it was concluded during preparation that the parameter on which the medium and long term adequacy of the river flow will depend is mainly the desired dilution to the sewage from Rampur and small villages. It was estimated that for maintaining water quality in the river stretch at the project area, 5 cumec would be necessary. As part of the already agreed release from the Nathpa dam, per the regulatory requirement of GoHP, 7 cumec is released that will therefore maintain acceptable water quality. In addition, as part of the EMP, SJVN included to fund the establishing of a sewerage treatment plant in order to treat the sewage flowing into the River Satluj from the Jagatkhana and Brow villages located opposite Rampur town, to further improve the water quality. The EMP also included water quality monitoring by SJVN of residual impacts due
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to managed river flow, as part of the project’s overall adaptive monitoring program and all relevant actions including further augmentation of lean season managed flow will be taken up if warranted by such monitoring. Impacts on physical cultural resources: The project area does not have known archaeological or historical sites or remains. This was confirmed by a field-based archaeological study of the project area. There is only a small possibility of impact on cultural properties (such as community religious properties, sacred groves, and chance finds). The EMP included procedures to identify such properties, and mitigate and manage impacts in case such properties are affected. Other Induced Impacts and Cumulative Effects: The impact assessment identified the potential induced impacts of increasing urbanization of the area around the project, particularly Rampur town, which could result in demand for water, effect on water quality due to increased sewage load, possible drying up of small water sources, and perceived damage to built properties. To address this, the project, jointly with the villagers, collected baseline data (complete with photographs and video). The water sources was to be monitored as part of the adaptive monitoring program, the project included augmentation of water supply to the villages as part of the SCDP. On the perceived damage to built properties the baseline determined jointly with the villagers would serve as a basis for compensation in the event of damages. The project did not construct any new power transmission lines. Power would be evacuated through a short loop-in loop-out arrangement by connecting it to the existing high voltage transmission line at Duttnagar.
Implementation and Outcomes The implementation of the EMP suffered challenges throughout the project duration. The first years where characterized by slow operationalization of the EMP components, including delay in augmenting human resources for the environmental units at the project and at the corporate levels, thereby delaying setting up procedures for environmental monitoring, executing training plans, and establishing a dialogue with state authorities for implementation of their responsibilities. Problems were also encountered since the tunneling work produced larger than expected amount of muck, which the contractor had difficulties depositing in accordance with the EMP rules. SJVN, in dialogue with the GoHP and the Bank team, took corrected measures to deal with these challenges and in April 2015, after the completion of the Rampur project, the results show overall that environmental concerns have been addressed and mitigated. SJVN has during the project maintained an environmental team headed by a General Manager/Senior Manager to oversee the environment management in the project, and monitored contractor’s works to ensure that the EMP aspects implemented as per the agreed EMP for the project. The company has obtained and implemented the Environment management Systems ISO 14000 and ISO 18000. The project has also received national recognition from 2006 – 09 and 2012-14 (Green Tech Awards) for its management of environment and OHS issues. SJVN has provided the necessary financial contribution for the implementation of the Catchment Area Treatment Plan, Compensatory Afforestation, Fishery Development Activities, Cultural Properties Development/enhancement and other local area enhancement measures being implemented in the project influence area by the other state government agencies.
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By March 31, 2015, 120 ha of the Compensatory Afforestation had been undertaken (86% of the targeted 139 ha). Rs. 185 million (82%) of Rs. 226 million deposited with the HP State Forest Department has been utilized for the CAT plan. Rs. 7.16 million (72%) of the Rs. 10 million deposited with the Fisheries Department has been utilized for the fishery program. The state programs for wildlife conservation has commenced. Although, the exact information of physical actions taken for those programs is not available from the GoHP at the writing of this report, the utilization of the funds for the envisaged programs have been documented. And although the plans are not yet fully implemented to 100%, the state departments are, as stated in meetings with the SJVN and the Bank team in December 2014, committed to do so as part of their running annual environmental management programs. Related to land, forest, fish and wildlife management, the Rampur Project, has therefore contributed additional actions than was warranted by the direct impacts of the project, and has overall enhanced the environmental management in the area of the project. The impacts of construction have all been addressed. Disposal and management of muck generated from the construction activities of the project was carried out by the contractor, as per the ‘Muck Management Plan’ developed in the EMP for the project and monitored by SJVN. The protection measures, included construction of retaining walls and regular maintenance to ensure that no muck is spilled into the river. Three pilot projects were also implemented by SJVN to test the efficacy of various techniques of restoration of muck dumping sites and ‘Geo Green Blanket Technique’ was demonstrated to be successful in the project area. In April 2015, the restoration and landscaping of construction sites, and the remediation of muck dumping sites, were completed. Temporary construction impact mitigations were managed by the contractors and monitored by SJVN. Dust prevention was combined with local community development programs through awarding petty contracts to local residents for sprinkling of water. An environmental laboratory was developed (August 2011 at a cost of Rs. 5.25 million), and an environmental monitoring program was conducted during the Rampur project. Components of the program included water analysis, wastewater analysis, air quality monitoring, noise monitoring, meteorological monitoring, soil/sludge/sediment and solid waste testing. A total of 692 samples had been taken by December 2014. The monitoring program will be continued during operation. The monitoring and analyses have showed no problems related to the water quality concerns expressed at preparation, despite that the new sewage plant for Jagatkhana and Brow towns has been delayed. The Local Area Development Authority (LADA) is yet to decide on the modalities of the implementing the sewage treatment facilities in these villages. SJVN is still committed to support this activity as and when decided by LADA. The potential negative induced and cumulative effects for the Rampur Town and local communities have not been a reality, as proven by the end-term impact evaluation (see Annex 5). Damages to built properties occurred, but was fully compensated by SJVN. The community development program included improvement in existing and provision of new water pipe lines and storage tanks that has improved water supply, and distribution of toilet seats and other materials that has improved sanitary conditions.
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Annex 7. Technical Characteristics of the Rampur Hydropower Project
1. The Rampur hydropower project is situated downstream of the Nathpa Jhakri Hydropower Project (NJHP) on the River Satluj in the state of Himachal Pradesh. The scheme is located about 140 km northeast of Shimla, the state capital, on national highway NH-22. In the project area, the national highway runs parallel to the River Satluj at a distance of approximately one km. The upstream 1,500 MW NJHP, which was also constructed with the help of an IBRD loan, has been in operation for more than ten years: The first of its six 250 MW units was commissioned in October 2003, and its sixth unit in May 2004.
2. The Rampur hydropower project uses the water exiting from the NJHP tailrace, and thus did not require a dam or de-silting chambers. It is a run-of-river project operated as a cascade station to NJHP. The Rampur hydropower project intake, which in effect is the NJHP tailrace, was partially excavated and built during the construction of the NJHP as it was always planned that there would be an additional downstream station. The NJHP tailrace, thus, acts as a breaking cistern in the water conduction between the two stations, which will operate in tandem. The project elements are detailed in Figure 1 below.
Figure 1: Illustrative Arrangement for Rampur Hydroelectric Project
INTAKE NATHPA DAM AND DE-SILTING CHAMBER
NATHPA JHAKRI OUTFALL STRUCTURE
NATHPA JHAKRI RAMPUR CUT & COVER (TUNNEL) HEAD RACE RIVER CROSSING TUNNEL (27 km)
NATHPA JHAKRI POWER HOUSE 1500 MW (6x250MW) JHAKRI NATHPA JHAKRI TAIL RACE TUNNEL SUTLEJ RIVER RAMPUR INTAKE – Already Constructed
RIVER DIVERSION TUNNEL TO CONSTRUCT RAMPUR TUNNELLED CROSSING RAMPUR TOWN
RAMPUR POWER NATIONAL HIGHWAY (NH-22) HOUSE RAMPUR HEAD RACE TUNNEL 412 MW (6 x 68.67 MW) 15 km
RAMPUR OUTFALL NOGLI KHAD
SUTLEJ RIVER
VILLAGE BAEL
Diagram not to scale DUTTNAGAR
3. From the Rampur intake, a 15.177 km, 10.5 meter diameter headrace tunnel, transfers the de-silted water exiting from Nathpa Jhakri power house, at the rate of about 384 cubic
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meters per second to the head of three above-ground, surface-mounted steel penstocks, with diameters of 5.4 meters, which branch to six penstocks measuring about 3.8 meters in diameter. These penstocks deliver the water to drive the six turbines in the surface powerhouse on the left bank of the River Satluj near the village of Bael.
4. The Rampur hydropower project has a gross head of 139 meters. The powerhouse (138 m long x 26 m wide x 48 m high) houses six 68.7 MW Francis turbine generators, which are designed to operate with a net head (gross head less headrace tunnel and penstock friction effects at full water flow) of 119 meters. The volume of water flowing into the Rampur hydropower project is the same as that for which NJHP was designed and operates. The 412 MW power output of the RHP is a direct product of the 139-meter pressure head and this flow of water. The powerhouse structure also houses the six generator transformers, which step up the 11 kV generation voltage to the 400 kV ground-surface gas insulated switchgear yard, for transmission into the northern electricity grid.
5. The RHP was designed with a rated capacity of 412 MW to be capable of generating some 1,770 million units (in a 90 percent hydrological dependable year with a 49 percent annual load factor). However, since Rampur’s design, and following improvements in the silt management at NJHP, the annual load factor and thus the design energy of the upstream station has been amended upwards and as a result, Rampur design energy is now considered to be 1,878 million units with an annual load factor of 52%.
6. The energy generated by the RHP is used in the states of the northern electrical region of India. The project contributes to the development of Himachal Pradesh, which receives a royalty of 12 percent of the power generated in return for the use of its water resources. In addition, in recognition of its investment in the project, the state of Himachal Pradesh also receives an additional allocation of around 109 MW of power together with dividends from the project.
7. Hydrology: The River Satluj originates near Rakas Tal in Tibet and is fed by Lake Mansarovar, which lies at an altitude of 4,550 m. It flows through the states of Himachal Pradesh and Punjab in India and joins the River Indus in Pakistan before draining into the Arabian Sea. The total catchment area upstream of Rampur and Nathpa Jhakri is 51,000 km2, of which 37,000 km2 lies in Tibet and the remaining 14,000 km2 is in India. The snow line in this region is approximately 3,000 m above sea level. The Tibetan plateau lies at an altitude of about 4,570 m with no vegetation. Precipitation occurs mainly in the form of snowfall. The river is heavily silted for much of the year. Successive deposits of boulders, gravel, clay and mud have formed the plateau. The deposits lie in beds that are nearly horizontal. The River Satluj has cut a channel several hundred meters deep through the plateau. The channels of most of the tributaries in this region present similar features with deep, narrow vertical-walled canyons. Downstream of the Tibetan plateau to Nathpa, the river is confined by 1,500 m high hills, and generally flows within a 300 m deep un-populated canyon.
8. Between April and June, the river is fed almost exclusively by snowmelt. Rainfall in this section of the river, averaging 780 mm per annum, is mostly concentrated between June and September and is determined by the onset of the southwest monsoon. The peak flows of the river occur during this period, while the lean period occurs between October and April.
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9. Tandem operation of the Nathpa Jhakri and Rampur hydropower projects: As noted above, the NJHP tailrace acts as a breaking cistern in the conduction of water through to the Rampur headrace tunnel. The cistern’s volume is limited in size. As a result, the two stations have to be tightly controlled in order to avoid the possibility of air entering the Rampur head race tunnel. This has been achieved by installing a modern control system using ultra sonic flow measurement devices and cameras. It is possible to control the entire Rampur station from the NJHP control room and consequently for Rampur’s units to be tripped immediately to match any shut down in NJHP’s units. This control system is the first of its type in India.
Systems display showing both stations for monitoring tandem operation
10. Sedimentation and silt erosion: The natural regime of the River Satluj is to carry a considerable volume of sediments particularly during the high-flow season. Sediment and erosion control measures upstream of NJHP, by soil management and afforestation, can offer very limited possibilities of reducing the sedimentation load, because of the natural physiography and soil morphology of the region; and the impracticability of introducing vegetation at the high altitudes around the upper reaches of the river, from where much of the silt originates. Recognizing this, the design of NJHP; (i) provided for gates in the dam to facilitate the periodic flushing of the fore-bay pond in its intake area; (ii) specified turbines materials to minimize equipment wear and tear and down-time for maintenance; and (iii) included, at the head of the power tunnel, wide underground de-silting chambers, where the water flow reduces, and heavy sediments above 0.15 - 0.2 mm in diameter settle into troughs and the resulting slurry is returned to the river.
11. However, silt erosion of the turbine runners (impellors) and the associated equipment encountered was far more deleterious than was expected when the NJHP was planned. This was mainly because the silt load content of hard quartz was higher than was expected when the river content was analyzed and the project designed in the 1980s. Consequently, SJVN has been using modern ceramic coating for some components and very hard tungsten carbide layering for other components. The design of the RHP runners and other related equipment
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took into account the considerable experience gained at the NJHP. The amount of silt damage is directly related to the pressure head on the equipment, and the velocity of impact. In the case of the NJHP, the pressure head is about 428 meters, and the speed of the units is 300 rpm, while the head at the Rampur hydropower project is 119 meters and the speed is 214 rpm. Thus, given the actions taken on silt management at NJHP the siltation damage at Rampur in the future is expected to be less than that inflicted on the NJHP equipment.
12. Contracting: The project consisted of three main contracts, two civil works and one electro-mechanical package. These contracts were let by SJVN using international competitive bidding for a standard bill of quantities style construction contract. SJVN used their own staff of engineers for construction supervision and contract management. The project also benefited from the assistance of an Advisory Board (composed of international experts) for technical issues, specifically tunneling; such as the use of lattice girders. There were separate Dispute Resolution Boards to deal with each major contract and these functioned effectively in minimizing the number of disputes to be escalated to arbitration.
13. Various parts of the site are depicted in the photographs below; provided by SJVN.
Power house
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Power house and penstocks
Power house
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Surge Shaft
Rampur control room
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Rampur intake (Nathpa Jhakri tail race)
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Annex 8. Lessons Learned from the Implementation of Nathpa Jhakri Hydropower Project (NJHP)
These lessons are summarized from the World Bank Implementation Completion Report – showing how these lesson were incorporated in the implementation of Rampur as SJVN has grown and developed.
Lesson learned from Nathpa Jhakri How was this lesson used at Rampur
Environmental and social impacts:
Run-of-the-river projects, where displacements are Rampur was not only a run-of-the-river but limited and sympathetically dealt with and negative required no dam. As a result its environmental environmental impacts are mitigated to minimum and social impacts were moderate and levels, can have positive environmental benefits by manageable. However, its lack of a reservoir obviating the need for construction of additional means that, unlike NJHP, it is unable to provide thermal power stations. any flood attenuation and is tied to NJHP’s generation schedule.
World Bank implementation support is effective in World Bank support from Environmental and ensuring the affected population receives the Social specialists continued throughout the RHP specified benefits, especially where it is conducted and these frequent visits from staff based locally by specialists. were a key feature of the successful environmental and social achievements.
However, supervision by Bank staff is not enough Rampur management have appreciated the in itself. It needs to be fully supported with importance of good environmental and social effective management by the project owner, and implementation from the very start as evidenced this support needs to be engendered early in the by the early implementation of such interventions project cycle. For NJHP it was missing for a as the mobile health van even before the project decade - until 2001, when new managers were was approved by GoI and subsequently, design finally appointed, who realized the importance of and implementation of a community development the various goals, and helped ensure their program to provide benefits to the local achievement population in terms of infrastructure improvements.
Pre-conditions for project appraisal should include This was one of the areas, where based on the commitment to the project by other agencies and lessons learnt, Bank engaged in a policy reform the establishment of a framework for the resolution dialogue with the State Government and two of inter-agency issues. Development policy lending engagements with The Forest Department took three years to the state have been undertaken and in both the prepare a draft catchments area treatment engagements, a key pillar has been the sustainable plan, and even after this lengthy period of development of hydropower, including following preparation, the draft is not of a high a Basin management approach. This has resulted quality. in the following changes and improvements: (i) The Fisheries Department submitted a Basin level CIA studies are planned for all river fisheries development plan in 1999, and basins, with a study for the Satluj and the Chenab NJPC deliberated over the plan for more basin already underway; (ii) Basin level than two years. integrated CAT plans prepared for four river The road agencies constructed poorly basins and implementation commenced. If the designed roads, which have resulted in progress of CAT plan implementation for NJHP frequent stoppages of the work at the and Rampur is compared: Rampur CAT plan was
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project and thus contributed to costly almost 80% completed (in terms of expenditure) delays. by December 2014 while NJHP CAT plan was Better co-ordination and commitment from the line only 4% complete by the time the station reached agencies, as well as proactive initiatives from NJPC commercial operation. would have resulted in minimizing the environmental impacts as well as reducing the While this shows that significant progress has delays. been made, more is required given the limited institutional capacity amongst other agencies responsible for implementation of certain aspects of the project continues to hamper the timely implementation of environmental and social management plan objectives.
It is now recognized that the quality of EAs and The current project, having been prepared under EMPs are major determinants for successful the Bank’s most recent safeguard standards implementation of environment management placed early emphasis on the need for a high actions. Even if the EA/EMP for the NJHP was standard of documentation. A number of studies, not part of Bank loan conditions (at the time the in addition to the EIA, were undertaken prior to project was prepared), the Bank should have the project implementation to ensure that all the reviewed these early in the project cycle. The environmental aspects were comprehensively Bank’s current safeguard policies, now in place, considered. These included: a study of the would have done much to bring earlier attention to managed river flow in the project area of the these social and environmental considerations had River Satluj; an assessment of the terrestrial they been in place when the project was appraised. biodiversity impacts; an analysis of the induced impacts of the RHP and cumulative impacts of hydropower development in the Satluj river; a safety assurance plan; an emergency preparedness plan; and an archeological study. These helped avoidance of a few impacts, and early implementation of mitigation measures (such as preparation and protection of muck dumping areas, prior to actual start of tunnel excavations).
Project preparation and implementation:
Anticipatory project preparation pays high dividends. Indeed such preparation is essential if a Procurement was well advanced by the time the project, especially of the magnitude of NJHP, is to project was appraised and consequently moved get off to a reasonable start. Procurement, whether ahead swiftly once financial closure was reached. funded by the Bank or not, needs to be well in hand In fact, the two main civil works contract (out of by loan approval. Estimates of the project costs can the three main contract packages) were awarded be quite accurate if bids have been received for the in February 2007 and work commenced before larger packages, and thus surprises are kept to a WB appraisal was completed and several months minimum, and financing can be arranged before the loan was approved in September 2007. accordingly.
Where risks are identified, they should be carefully Rampur learnt this lesson and carried out analyzed by experts knowledgeable in the local extensive pre-project surveys and investigations (underground/geological) conditions. In the and, while there were still unexpected conditions appraisal exercise risks must not be downplayed, encountered, the management were quick to and their impacts should be understood and if involve expert opinion (putting in place an possible anticipated. international panel of experts, as advised by the Bank) and open to implementing the changes in
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practice which were recommended. As a result, although problems were experienced the consequent cost and delay impacts were not as substantial as they might have been.
However, the additional adit, could have been considered earlier and the decision to avoid use of this adit taken during early preparation was taken to avoid risk of complaint of unnecessary relocation, but in retrospect it would have been better if this decision had been taken earlier.
Good preparation should also anticipate the need Communication between SJVN and the for proper communication with the site of the contractors was considerably enhanced from the works, including adequate roads and time of NJPC, with daily meetings on the major telecommunications links, as well as site supplies contracts. Site services were also better prepared. of water and power. Communication between SJVN and the local community was a focus area for the project team at site well before construction began and regular (formal and informal) meetings took place. SJVN took steps to set up a Public Information Centre (PIC) and started community initiatives (such as the mobile health van) in the early stages of project preparation.
Enthusiastic project ownership is essential. Despite Decision making was clearly a lesson learned NJHP being owned by GoI and GHP, it had no between the two projects. Close contact between permanent or even semi-permanent representative SJVN and the contractors, which documented all in either organization, who was sufficiently issues as they arose, made claims less contentious empowered to get decisions made. And there is an and led to faster and more effective decision underlying reason why delays in decision-making making. were so prevalent. Decision-making involves risks. Speedy decision-making often involves greater Decisions were also delegated effectively and risks. In many cases during NJHP's staff were supported to take necessary decisions implementation, decisions makers were vilified, to keep the project progress to time as far as despite proving to have been correct and in the possible. Decisions were also taken which process saving enormous expenditure and speeding allowed some acceleration of works so that some up implementation. The lesson is that ownership, of the delay could be recovered. speedy decision-making and risk-taking need to be engendered by central and State Governments. Under the RHP, 74 variations orders have been issued to date whereas in the case of NJHP, no variation orders were issued until after the project was complete.
A unique and positive lesson to be learned from the DRBs have also been a useful feature of NJHP experience is how useful the Disputes Rampur’s contract management. Of the 26 cases Review Boards (DRBs) became, in quickly referred to DRB, 16 have already been settled. resolving disputes, which in turn helped accelerate The improved communication with contractors implementation progress. has led to fewer claims and fewer disputes on the contacts.
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And finally, a financial and economic model of the While SJVN now have a financial model for each project should have been in place prior to thievery project and the company as a whole, it is still not start-up of the project, so that the "true cost" of kept regularly up to date and is not the crucial aid implementation delays could be calculated as each to decision making which was envisaged in this decision was faced. This model would have comment. Training was undertaken in the best factored in the cost of failure to generate on time practice development of excel based financial and thus placed into context the expense or actions models, but staff have moved on and the training needed to produce huge economic gains for the has not filtered down to a more general country. Despite repeated reminders from the Bank, understanding of the advanced use of such a model was not developed until the last few spreadsheets. months of project implementation. The absence of a model which can illustrate the cost of inaction or delay can sometimes made it difficult for the management to take the economically optimal decision in the interests of the country or the financially optimal decision in the interests of SJVN. This seems to be part of a common view in the public sector in India where the system does not encourage the use of such an approach, preferring a more direct comparison of cost of different alternatives. Without considering the impact of lost time, a direct comparison of cost may lead to sub-optimal decisions. However, this was less of a problem than it was in the NJHP and shows an improved attitude to management decision making.
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Annex 9. Summary of Borrower's ICR and/or Comments on Draft ICR
SJVN Limited (A Joint Venture of Govt. of India & Govt. of H.P) (A Mini Ratna Schedule 'A' PSU)
Borrower’s Evaluation Report of 412 MW Rampur Hydro Electric Project (RHEP)
May 2015
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Table of Contents
Chapter No. Topic Page No.
1 Background & Project Outcomes and 72-73 impact
2 Costs and benefits derived/to be derived 73-74
3 Lessons learnt and found useful for 74-75 future operations
4 Bank’s and Borrowers performance in 75-76 implementing the project data and analysis
5 Banks role from SJVN’s point of view 76-77
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Project Outcomes and impact
SJVN’s key objectives in developing of Rampur HEP are i) addition of 412 MW renewable, low carbon energy from the project to Northern Electricity Grid; (ii) To improve the effectiveness of SJVN Limited with respect to safe implementation of economically, environmentally and socially sustainable hydropower projects; iii) To increase the stakeholders value in the corporation. iv) To gain economic benefit from the desilted tail waters of Nathpa Jhakri Hydro Power Station (NJHPS); v) to improve/deliver socio economic benefits to the project area/zone.
In India an estimated 30 crore people do not have access to electricity and GDP growth could not reach the targets. In this scenario it is essential to boost the power sector with the renewable, environmentally friendly, low cost power with inflation free fuel. In the recent past the desirable thermal to hydro ratio (60:40) in the country has deteriorated to an all time low. The other factor that comes into picture apart from power is reliability of the same in terms of frequency in the operating band.
One of the most important project outcome indicators for measuring the improved reliability of India’s Northern Electricity Grid (a project objective) will be the proportion of the time over which the grid frequency is maintained within the operating band of India’s Electricity Grid Code. However this Project indicator is not valid due to the changes, which occurred in the recent past such as grid failures and subsequent changes made to it. Thus the criteria is dynamically changing because of other developments in the larger perspective of the generation and transmission system.
The power from RHEP in combination with other projects in the grid, however, shall improve significantly the stabilization of the electricity grid, which will lead to a decrease in the number of power outages for consumers. As GoI has increased the requirement for a stable grid by narrowing the operating band in recent years, the importance of hydropower as a generation source in the system has become even more important. Rampur HEP, since it started commercial operation of all six units in 2014, has provided 1444.7 MUs of valuable energy till April 30, 2015 including infirm power of 70.67 MU in the grid with frequency in the operating band.
As far as the effectiveness of SJVN with respect to the preparation and safe implementation of the Rampur Hydro Electric Project economically, environmentally, and socially sustainable is concerned, it may be concluded that the same is more than satisfactory. Although SJVN faced several problems while executing the project such as unexpected poor to very poor geology, heavy ingress of water at high temperature, agitation by workers and local public etc., the project was completed successfully. The project was synchronized with the Grid and proven to run at its installed capacity on commercial basis (tested even for 10% overloading above 412 MW). CEA (Central Electricity Authority) has revised Rampur HEP design energy from 1770 MU to 1878 MU.
Rampur HEP, a tail race development of NJHPS, utilises the desilted waters of NJHPS for generation of 412 MW power. This eliminates the requirement for a dam and desilting facility, normally an essential requirement of all hydroelectric projects. Thus Rampur HEP has an advantage gained on the cost of construction of dam and desilting components.
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All major civil works and electro mechanical works were fully completed. Minor works on construction sites such as decommissioning of work sites, interior finish of power house and restoration of roads have also been completed. Complete re-vegetation of all the dumping yards will be completed by the end of July 2015. SJVN deposited CAT plan funds with the state Govt. and Rs 18.5 Cr (82%) of Rs 22.6 Cr total. State forest dept., covered 120 ha (86% of EMP) of afforestation by December 2014 and SJVN deposited full amount for EMP programme.
Project affected people (PAP) were resettled and fully compensated for loss of land/house before commencement of the civil works. Livelihood improvement of PAPs was recorded by an independent final impact assessment agency. About 87% of PAFs reported an increase in income. The final evaluation also demonstrates an increase in literacy rate, pukka houses and increase in area/size of houses. SJVN has spent Rs 48.2 Cr on local area development activities and local welfare activities up until December 2014. The funds deposited exclusively for water supply improvement with the LADF (Local Area Development Fund) remain to be implemented. Almost all the small contracts worth Rs 33.7 Cr in total were awarded to local contractors (119 contracts) and the main civil contractors assigned petty contracts worth more than Rs 100 Cr to local sub-contractors.
The data collected from the sample PAFs clearly shows that the overall living standard of the families has improved due to the Rampur HEP implementation. There is improvement in the level of education and literacy rate. There has been an increase in full-time employment in the villages due to RHEP activities. Diversification of income and employment avenues has been achieved through various forms of technical education, training, income generation schemes, towards business and other self-employment activities. There have been positive impacts on income and employment pattern of project affected families. The income in absolute terms has gone up from Rs. 120648 per house hold/year during base period to Rs. 389218 per house hold/year currently. The number of pukka houses increased by 180 percent over the base period. There has been improvement in living of standards of PAFs. All these factors shows socio economic benefits to the project area/zone has been increase certainly.
Costs and Benefits Derived/ to be derived
Cost-Benefit derived/ to be derived gives an idea of the equivalent money value of the benefits and costs to the community of a project to establish whether they are worthwhile. Economic and Financial rate of return is the best measure of understanding Costs and benefits derived from the project. At the time of project appraisal by the Bank, the economic rate of return was expected to be 19.3%. Due to delay in project commissioning and cost escalation the same has come down. According to estimation by the Bank the same may be around 14% based on the final cost to completion. The project will achieve a 16.5% return on equity as per CERC 2014- 19 guide lines. Rampur HEP has been approved for carbon emission reduction credits. If environmental benefits of avoided carbon are included, then the ERR changes to about16.6% as per the Bank.
Socioeconomic development activities of the project affected area have been carried out by SJVN. The focus of these activities is the infrastructural development depending upon the relevance, demand and requirements of the local populace. A total number of 28 community development works costing Rs 2.04 Cr were completed. Before the commencement of LADF, various community development works were undertaken costing Rs. 1.42 Cr pertaining to the
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construction of pukka paths, kuhls, street lighting, playground and footbridge etc. For construction of steel bridges in Jhakri and Bayal panchayats, boxing ring at Rampur College, road and hospital at Bayal Rs 21.49 Cr was spent. After the formation of LADF, 32 works of pukka paths were completed by incurring Rs1.13 Cr in the district of Kullu.
In the district of Kullu, works of kuhl construction in Gadej panchayat, retaining and boundary wall at Bari, Tunan and Gadej panchayats, playground, fencing, road, drinking water lines and tanks were constructed incurring Rs 0.51 Cr. Twelve works of construction and repair of buildings and temples were completed in district Kullu at the cost of Rs. 0.52 Cr and three foot bridges were constructed in Gadej, Kushwa and Tunan panchayats at an aggregate cost of Rs. 0.89 Cr. In total 64 such community development works were completed at a total cost of Rs. 3.12 Cr in the district of Kullu. In the district of Shimla, after the formation of LADA, 22 development works were completed at a cost of Rs. 0.63 Cr. These include 8 works of construction of pukka path, 6 works of construction of fencing and playground, two works each of repair of temple and construction of roads. In addition, construction of a room, drainage, breast wall and community bhawan were also completed.
One of the main benefits accrued from the project is delivering valuable low carbon 412 MW to the Northern Grid during peak demand. The other works, which come under direct benefits are concerned with catchment area development by compensatory afforestation, check dams and retaining walls to prevent soil erosion, R&R and community development works, health benefits through hospitals and mobile health vans, schools, scholarships, fisheries development etc.
Apart from tangible benefits several intangible benefits can be attributed to the project such as overall development of the remote areas, increase in per capita income, increase in living standards of the local populace, increase in literacy rate etc. Rampur HEP is a complete package of development for the state of Himachal Pradesh and country at large.
Lessons learned and found useful for future operations
Kasholi adit was not considered during planning/ award stage between Kasholi and Kunni due to close proximity of village Brow, Jagatkhana and Rampur. This was to avoid additional R&R problems that may have occurred due to the dense population in these villages. Had it been initially envisaged in the scope of the contractor, delay in completion of this adit and HRT could have been saved to a great extent as time taken for diversion of forest land/ private land for Kasholi adit works could have been avoided.
For future operations more sophisticated and modern methods must be used for realistic assessment of geological features so that we can assess the progress of tunnel excavation rate more accurately. The expenditure in these exploration works shall always be compensated adequately in terms of time and cost.
While excavating HRT in Kasholi D/S, very near to the adit a big cavity occurred, which held further progress of excavation on the heading. Considering the time loss that could take place in treatment and handling the cavity, a bye-pass tunnel from the Kasholi adit to the downstream of cavity was excavated and proceeded accordingly with HRT excavation. The cavity along with a small stretch of HRT downstream of cavity was tackled separately.
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Although advance core drilling from the face may take a little extra time, in such type of rock conditions it is always advisable to explore the rock in advance at least for 10 to 12 m to avoid surprises and cavities.
Carbonaceous phyllites on the southern wall of Surge shaft with strata dipping inside the Surge shaft posed a serious problem in the excavation of gate shafts and communication shaft. To counter this problem, a decision was taken to carry out the excavation with the same diameter to the bottom without communication shaft. This was the only viable and feasible solution to handle the situation.
During excavation of the HRT from Kajo downstream, heavy seepage of water with high temperature in the HRT occurred causing flooding of the HRT and stoppage of heading excavation. Additional dewatering pipe lines were laid and dewatering was done with heavy duty pumps, but in vain. In order to tackle the seepage, after exhausting other methods of grouting, finally chemical grouting with Polyurethane was resorted to.
Provision for chemical grouting and dewatering may be kept in such big projects in the planning stage itself in particular in the unpredictable geological conditions in the young Himalayan region.
As suggested by Bank experts, Lattice girders with shotcrete was adopted which acts as reinforced arch as supporting system in HRT to improve the cycle time in poor rock class in place of heavier steel ribs and RCC/ PCC lagging which require a lot of time for installation and contact with rock surface is often less than adequate. This system not only reduced the cycle time but also acted as monolithic concrete arch to give enough strength in the poor rock conditions.
In future projects, probability of provision for lattice girders may be explored as rock support system with a little more research work in this direction for more judicial use of the same.
Banks and Borrowers performance
The first project in which SJVN has commenced association with World Bank was the 1500 MW Nathpa Jhakri Hydro Electric Project during 1990s. Immediately after completion of the project and its commercial operation of all its units in May 2004, a MoU was signed in October, 2004 for implementation of Rampur HEP with Govt. of Himachal Pradesh (HP). The funding arrangements were initiated by SJVN for 70% of the loan component of Rampur HEP thereafter. In reference to the Department of Economic Affairs, Govt. of India’s letter World Bank communicated its willingness to provide loans to SJVN for its Rampur HEP, vide its letter dated April 8, 2005. The final tripartite loan agreement for RHEP was signed on January 15, 2008 for USD 400 Million between World Bank, Govt. of HP and SJVN.
SJVN’s and GoI’s idea behind the engagement at that time was more strategic as the financing from World Bank will bring in the latest expertise world-over in various fields such as contract management practices, latest technological solutions for various problems that may crop up during project execution, over all development of the project area on the fronts of environmental and rehabilitation activities and bringing in the latest practices in various fields. World Bank funding means a complete package of developmental opportunities for any organization that is why SJVN opted for funding the loan component of Rampur HEP (412
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MW) from World Bank. Bank helped SJVN to keep abreast of the latest techniques and practices in several fields.
Contract management in contract life cycle is the process of systematically and efficiently managing contract procurement, execution and analysis for maximizing operational and financial performance and minimizing risks of claims from the contractor. The Bank assisted SJVN in all phases of contract from procurement to completion. Variation orders were issued timely so that the contractor should not suffer from cash flow shortages and thus continue to make progress. In Rampur HEP, 74 variation orders were issued in total and extension of time to both the major civil contact packages were issued. DRB’s were constituted beforehand so as to resolve any disputes with the contractor timely. Out of the 26 cases referred to DRB, 16 have already been settled.
SJVN has started implementation of Risk management policy which is a pre-requisite of corporate governance on which the Bank insists. Project specific Risk management plans (RMPs) were also developed by SJVN within the ambit of overall Risk Management Policy of SJVN taking into consideration the requirement of various projects. The project specific RMPs incorporated various lessons learnt during the implementation of Rampur HEP.
From the very beginning, Bank played a key role in implementation of institutional strengthening and organizational development in SJVN. SJVN, with objectives to maintain the knowledge base of its employees and learn about various new innovations and techniques in various fields including environmental management, sent its employees to different training programs. The training imparted has raised the awareness of employees of SJVN and main contractors on technical, environment, social, occupational health and safety aspects which has benefitted SJVN in terms of better performance. An expert external agency M/s. KPMG was hired for this purpose and its recommendations are being implemented to the extent of immediate requirements.
Financial management is another important field where in SJVN has developed its expertise over the years. The Bank always insisted for best financial management practices in SJVN. Fund forecasting along with timely and accurate preparation of quarterly accounts is rated at 100%. SJVN also started preparing 10 year fund flow statements to assess its revenues and expenditure from its operations.
SJVN is in an advanced stage for implementing ERP (Enterprise Resource Planning) management system. In the first phase, the plan is to implement financial management, Material management and Payroll (HR) modules.
Bank’s Role from SJVN point of view
Over the years SJVN established itself as an international organization, from a single hydro project in Himachal Pradesh to pan India presence and then as a multinational company, in all its glory the Bank always remained with SJVN. The Bank always pushed SJVN beyond its limits to achieve the best in the industry. In the fields of Institutional strengthening, Financial management and fund forecasting, Contracts management, Operations management, Procurement management through E-Tendering, Environmental Management, Rehabilitation and Resettlement policies, Carbon financing, vender development, Safety norms
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implementation, Web site development and now in Enterprise Resource planning, the assistance of the Bank is appreciable.
As far as intangible benefits are concerned the Bank is helping SJVN in its endeavour to establish its brand name world over as an expert in Hydro Field from concept to commissioning, mediating between various Govt. and non Govt. agencies in the interest of the works to resolve deadlocks/issues, help bringing in innovative ideas adopted in other Bank funded projects from the world over to SJVN such as lattice girders for tunnel supports, techniques to improve cycle time etc. It has been really a magnificent and splendid journey working with a team full of energy and dynamism. SJVN has been immensely benefited with their constructive attitude shown towards the whole matter of project development.
SJVN has received 6th CIDC – Vishwakarma Award 2013 & 2014 for Achievement in the field of Construction Health, Safety and Environment, Greentech Environmental Excellence Gold Award-2013, Greentech Environmental Excellence Silver Award-2009 & 2012, Greentech Environmental Excellence Bronze Award-2006 & 2007, Golden Peacock Environment Management Award 2009 for the best practices of Environment Management. This achievement could not have been possible without the valuable guidance and best practices suggested by the World Bank team.
World Bank team’s progress review missions are particularly helpful in reviewing the total progress achieved, critical issues hampering the progress, in providing more focused attention on critical issues, a well-organized approach towards attainment of objectives and also making an in-depth analysis of situations. Several solutions to the problems such as introduction of new Adit at Kasholi between critical reach of Kunni-Goshai to cut down time for HRT excavation, bypassing the HRT downstream cavity/roof collapse by constructing by pass adit, replacement of cut & cover section with underground low cover tunneling in river crossing reach, introduction of NATM technology to enhance progress rate, tackling of hot and heavy seepage of water at Kajo HRT, re-organizing the power -house excavation methodology, Change in the construction methodology for widening of Surge shaft are some of the outcomes of discussions with the World Bank and panel of experts team constituted with the assistance of the World Bank.
The untiring efforts of World Bank in improving the cycle time during excavation and pushing activities of the project has been gainfully utilized by SJVN in early commissioning of the project. Unit-5 of Rampur Hydro Electric Project of SJVN Limited has been selected for the 'Gold Shield' while Unit-2 has been selected for 'Silver Shield' for the year 2013-14 by the Central Electricity Authority, Government of India in the category of "Early Completion of Hydro Power Projects".
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Annex 10. List of Supporting Documents
Besides the Bank’s Project Appraisal Documents, Implementation Status Reports, and Aide Memoirs, the following list of documents were consulted for this report:
Rampur Hydro Electric Project, Himachal Pradesh, Detailed Project Report, WAPCOS, August 2006
Mid Term Review Report of Rampur Hydro Electric Project, SJVN, November 2010
Mid Term Impact Evaluation of Resettlement Action Plan and Community Development Activities of Rampur Hydro Electric Project, SMEC, November 2010
India & The World Bank Group in a Time of Transformation, The Country Partnership Strategy 2013-2017, A Summary, World Bank 2013
An overview of Occupational Health and Safety in Indian Infrastructure Projects, prepared by SARDE with support from SASDI, World Bank, 2013.
Rampur Hydropower Project – Land Acquisition, resettlement, Community Development Practices, The World Bank, August 2014
Final Review Report of Rampur Hydro Electric Project, SJVN, January 2015
Data on production, discharge and silt rates for at Nathpa Jhakri, SJVN, February 2015
End Term Impact Evaluation of Resettlement Action Plan and Community Development Activities of Rampur Hydro Electric Project, Agro-Economic Research Centre Himachal Pradesh university, March 2015
78 I N D I A RAMPUR HYDROPOWER PROJECT NATHPA JHAKRI HYDROPOWER PROJECT HIMACHAL PRADESH
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Ch en a b River CHAMBA
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HAMIRPUR MANDI River UNA Soan Rive Sutlej Wangtu RAMPUR Nichar r Kilba KINNAUR HYDROPOWER River Bhakra NATHPA JHAKRI Dam PROJECT HYDROPOWER Baspa RAMPUR BILASPUR Sutlej PROJECT River
SHIMLA SHIMLA Sutlej River SOLAN
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acceptance of such boundaries. ¤
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