Shimla, July 14 (IANS) Himachal Pradesh Tuesday asked mini hydropower project producers to provide funds for the development of the areas where the power plants have been commissioned, a government spokesperson said.
“The state government decided that all private power producers generating hydroelectricity up to 100 KW (0.1 MW) will have to provide three percent of the income generated from the project to the local gram panchayat for the first 12 years and six percent thereafter. The amount would be spent for developmental activities,” an official spokesman said.

“However, no upfront premium would be charged from those executing such projects. While allotting the projects, preference would be given to local entrepreneurs,” the spokesperson said.

Himachal Pradesh’s hydropower potential is 21,000 MW - about 25 percent of India’s total potential - out of which 2,000 MW consist of small hydro projects.

In the last 18 months, 12 small hydro projects having 57.4 MW generation capacity have been commissioned.

The state government is encouraging local entrepreneurs to take up projects with 2 to 5 MW generation capacity. The government has allotted projects above 5 MW through open bidding.

The average cost of a project is Rs.70 million per megawatt.