Proposal to Accelerate the Development of Hydro Pumped-storage Projects (PSPs)

Syllabus: GS3/Environment/Economy

In News

• The Central Electricity Authority (CEA) has proposed a regulatory overhaul to accelerate the development of hydro pumped-storage projects (PSPs).

Background 

• Eco-sensitive zones (ESZs) protect fragile ecosystems, and currently PSPs and hydropower projects are banned within ESZs and a 10-km buffer around protected areas. 
• Environmental concerns and local protests in states like Tamil Nadu, Karnataka, Rajasthan, and Maharashtra’s Western Ghats highlight risks to forests and wildlife.
• The CEA roadmap notes that cumbersome environmental and forest clearances, treating PSPs like conventional hydro, are a key barrier to development.

Major Highlight of the Proposal 

• Policy Shift for PSPs: The CEA has recommended allowing hydro PSPs within eco-sensitive zones (ESZs) and up to a 10-km aerial distance from protected areas where ESZs have not been formally notified.
  • It has also called for a differentiated regulatory framework for renewable energy projects and relaxation of stringent conditions applicable to the Western Ghats.
  • PSPs are prioritized over Battery Energy Storage Systems (BESS) due to long-duration storage and grid balancing capabilities.
• Capacity Targets: India’s PSP capacity to rise from 7.1 GW currently to 87 GW by 2033-34 and 100 GW by 2035-36.
  • Roadmap targets 100 GW of PSP capacity by 2035-36 to meet growing renewable integration and storage needs.
• Regulatory and Environmental Reforms: PSPs treated as a distinct category for environmental and forest clearances, especially off-the-river or on existing reservoirs, due to lower displacement and environmental impact.
  • The proposal proposed a differentiated regulatory framework for renewable-linked PSPs.
• Easing forest clearance hurdles: The CEA proposes easing environmental and land norms for PSPs by allowing degraded forest land to be used for compensatory afforestation at twice the diverted area, instead of non-forest land, a rule previously limited to certain public and coal projects.
  • It also recommends establishing a national-level land bank with mapped degraded land, a GIS-based repository, and a monitoring framework to streamline afforestation processes and support project approvals.
• Environmental Considerations:  The CEA prioritizes pumped-storage projects (PSPs) over battery storage due to their long-duration energy storage and fast, flexible grid-balancing capabilities.
  • PSPs store energy by pumping water to an upper reservoir during low demand or excess renewable generation and releasing it through turbines to generate electricity during peak demand.
  • PSPs generally have minimal environmental impact compared to conventional hydro 
  • Off-stream PSPs recommended to be classified under the “White Category” due to minimal environmental impact, simplifying environmental and forest clearances.
• Financial and Implementation Support: Extend Viability Gap Funding (VGF) to PSPs to offset high capital costs.
  • Focus on rapid development to support renewable energy integration and grid stability.

Key Challenges Identified

• Difficulty finding suitable non-forest land for compensatory afforestation.
• Regulatory barriers due to blanket ESZ prohibitions and 10-km buffers.
• Delays in state-level approvals for rehabilitation and resettlement.
• Requirement of fresh environmental clearances for minor capacity increases.

Conclusion 

• The roadmap seeks to address India’s growing energy storage challenge arising from the increasing penetration of variable and intermittent renewable energy sources such as solar and wind in the power mix.
• It aims to fast-track PSP development through regulatory relaxation, environmental simplification, and financial support, targeting 100 GW capacity by 2035-36 while balancing ecological and social concerns.

Source :IE