Karnataka is facing a temporary power crunch, and in order to tide over the immediate power shortage the state has considered setting up diesel power generating units and laying a gas grid along the coastline from Mumbai High, to utilize natural gas to generate power. The state has also identified 150 locations where mini and micro hydro-electric projects can be set up. Plans have been initiated to harness wind energy too.
By the end of 1997 the installed capacity was around 4,388 MW, with generation of 18,200 million units. In the 7th Five Year plan Rs.626 billion amounting to 28% of the total plan expenditure was spent on the energy sector.
June 2010: Karnataka is bestowed with Gas based power projects. Merchant power plants. Three 700MW gas based power plants fulfil the need of City gas distribution Dharwad-Davangere, Chitradurga and Tumkur.
Private Sector Participation
In keeping with the policy of liberalization set in motion since 1991, private investment for generation of power through thermal stations, mini and micro hydro – electric schemes, diesel power generation, etc are welcomed by the state.
The Karnataka Power Corporation and the Karnataka State Electricity Board are the two organizations managing power in the State. The Karnataka Power Corporation is entrusted with the investigation, execution operation and maintenance of power projects, whereas the Karnataka State Electricity Board deals with the transmission and distribution of electricity in the State. Energy generation in Private Sector.
The Government of Karnataka has envisaged a proposal for the generation of at least 2,500 to 3,000 MW of power in coming years. The following are the projects identified for private sector participation in the State.
| Thermal Projects | |
| Mysore Stage I | 2×250 MW |
| Mysore Stage II | 2×500 MW |
| Hospet Thermal Power Station | 2×250 MW |
| Raichur Thermal Power Station | 2×250 MW |
| Mangalore Thermal Power Station | 1000 MW |
| Hydel Projects | |
| Sarapadi Hydel Project in Dakshina Karnataka | 90 MW |
| Mahadayi Hydro-Electric Project in Belgaum district | 345 MW |
| Kalinadi Hydro Electric Project Stage III | 60 MW |
| Bedthi Hydel Project | 210 MW |
| Mini Hydel Schemes | |
| Kabini Dam Power House | 20 MW |
| Hemavathi RBC | 2.0 MW |
| Kelagoor | 2.0 MW |
| Iruppu Falls | 5.5 MW |
| Manjodka | 4.0 MW |
| Balyanthara Halla | 4.0 MW |
| Kutapuzha | 40 MW |
| Tunga Anicut | 20 MW |
| Shivayogi Mandira | 3.0 MW |
| Karanja | 1.0 MW |
| Upper Kaveri | 3.5 MW |
| Narayanapura Left Bank Canal | 8.5 MW |
| Yagachi | 1.0 MW |
| Varahi Irrigation Dam | 15.0 MW |
Wind Energy Projects
Non-conventional energy production using wind power are proposed at the following places :
- Kappatagudda (Dharwad)
- Jogimatti (Chitradurga)
- Gokak (Belgaum District)
- Malagatti
- Hanumasagar (Raichur District)
- Bommanahalli
- Hanumanamatti (Dharwad District)
The state has the potential of generating 11,500 MW from wind energy. As of June 2010, Karnataka is generating 520 MW from small hydro.
Guidelines The guidelines for private sector participation are:
- Private sector units can set up coal, lignite, gas based, thermal , wind and solar energy projects of any size.
- They can set up units as licensees, distributing self-generated power or purchased power. They can also act as generating companies for supply to the state grid.
- Licences can be issued by the state government to private units willing to enter the electricity sector.
- They can set up captive power plants to serve, sell or distribute surplus power to state Electricity Boards.
- Debt-Equity ratio of 4:1 is allowed for private companies entering the electricity sector.
- Upto 100% foreign equity participation is permitted for projects set up by foreign / private investors.
- Import of equipment for power projects is permitted in cases where the foreign supplier of agency extends concessional credits.
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