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Global emphasis on renewable energy and creation of suitable policies had a positive impact on renewable sector which registered robust growth during the last few years. As per Global Status Report 2009, large hydro power generation capacity at the end of 2008 stood at 860 GW. Other major sources of renewable energy were wind, small hydro and biomass power with an installed capacity of 121 GW, 85 GW and 52 GW respectively.
Hydro power is one of the earliest forms of renewable energy which is environmentally benign and has been successfully implemented across the globe. No fuel cost is incurred during the life time of hydel project and has a very little recurring expenditure due to which the cost of generation is considered almost inflation free. Hydel projects also have long productive life which significantly helps in reducing cost over time. The population is growing and so will its power needs. Rapid consumption of fossil fuels for electricity means that there will come a time when these will be depleted. Developing energy through sustainable and renewable resources is no longer a luxury, but has become a necessity. Hydroelectric plants can meet the increasing power needs without worries of depletion or pollution. It is also the most reliable source available today.
Inherent advantages of hydro power in Indian context are:
Hydro power, besides supplementing demand for electricity, is one of the better available choices for meeting peak demand because of its inherent ability for instantaneous starting, stopping, load variations, which can enable it to play a crucial role in reducing the peak deficit. India has an assessed hydro power potential to the tune of 150,000 MW; out of this only about 20% has been developed so far. India has total hydro installed capacity of 37,033 MW only and it constitutes to 23% of the total installed capacity.

Fig 1- State-wise Potential of Hydro Power Plant (Ref – CEA/Aug 2010)
As per “Hydro Development Plan for the Twelfth Five year plan,” a shelf of 109 Hydro Electric schemes aggregating to 30,920 MW has been identified, which includes 46 schemes under the private sector with an installed capacity of 12,007 MW. CEA expects 25,316 MW of Hydro capacity additions to be feasible for commissioning during the above mentioned plan.

Fig 2- Projected State wise addition of Large Hydro Capacity during 12th Plan (Ref – CEA/Aug 2010)
Himachal Pradesh is poised to grow at a fast pace in the coming years. The state is considered crucial to sustain the country’s economic growth. The reform measures being implemented and policy initiatives taken by the state government is expected to provide an enabling environment for this. The state has an identified potential of 20,000 MW ouof which 6,300 MW is operational.
Hydro Power Status in Himachal Pradesh
| Projects | Capacity (MWs) |
| Projects under operation (i/c Himurja Projects) | 6370.12 |
| Projects which are under execution/allotted and planned for 11th Plan period | 5744.1 |
| Projects which have been allotted/under process of allotment and expected to yield benefit during the 12th Plan period | 5615.5 |
| Projects which would have to be re-advertised | 1481 |
| Projects which have been abandoned due to environmental considerations | 435 |
| Projects under investigation for preparation of DPR | 46.5 |
| Himurja Projects (proposed/under execution-750/26.60; under operation - 26.60 MW) | 723.4 |
| TOTAL POTENTIAL | 20415 |