State-owned hydro power giant NHPC may face up to Rs 2,500 crore escalation in the cost of its Arunachal Pradesh project as it is nearly two years behind schedule due to pending environmental clearances.
The 3,000 MW hydel project being developed by NHPC at Dibang in Arunachal Pradesh was originally scheduled to get commissioned by 2017 but delays in necessary clearances have pushed it back by about two years, sources said.
“The project is about two years behind schedule, it was expected to start producing electricity by the end of the XII Plan Period (2012-17),” sources close to the development said, adding that the project can only come up in the XIII Plan Period (2017-22) i.e. about 10 years from now.
It will take about 10 years to complete the project, where nine years will be required for construction and another one for infrastructure development.
NHPC has received techno-economic clearance for the project and is awaiting those for forest and land, after which it would enter the process of tendering and contracting of equipment.
Meanwhile, the delay in environment and forest (E&F) clearance would affect the financials of the project as the cost of execution would go up.
“This (delay) would definitely result in cost over-run.
At present, an estimated about 6 per cent escalation every year is expected,” sources said.