CAPITAL INVESTMENT DECISION

CAPITAL INVESTMENT DECISION
in major Hydro Electric Projects
with case study of Bairabi HE and Kolodyne HE Projects


By- Er. K.Guite,
Superintending Engineer,
Project Circle – II,
Power & Electricity Department

Hydroelectric Project is in the realm of economic and commercial venture. So investment decision should not be influenced by emotional or any other extraneous considerations. The capital investment is large and commercial, environmental as well as technical risks are real. Major project is an educated gamble.
Moreover, major hydroelectric project is not an unmixed blessing. It is a trade off between loss and benefit. The project may give us electrical power and other incidental benefits but it can play hovoc with our environment. The decision for investment in a major project should be taken when and only when the benefit out-weights the loss. As it is, development activities like construction of a major hydroelectric project should not compromise the survival ability of future generations while the present generations meet their rightful needs. The damages to environment, ecology, biosphere etc due to major projects are, in most cases, irreparable. At best, mitigation measures can be taken.
At the same time, we cannot afford not to have major hydroelectric projects in Mizoram because-
i) Mizoram has more than 2400MW hydropower potential as assessed by Central Electricity Authority (CEA), Govt of India. According to the 16th Electricity Survey of India, the power demand of Mizoram increases at the rate of 9.17% per year. That means, the power consumption of Mizoram will be double every 8 years.
ii) Mizoram is not endowed with other natural resources like fossil fuel and other commercial minerals. Agriculture land is limited in Mizoram due to her hilly topography. By stretch of imagination, Mizoram cannot be rice exporting State in the foreseeable future.
iii) Hence, Mizoram needs major hydropower projects for catering to its own power demand. And at the same time, it needs hydroelectric power for export to exchange for her own needs from other States or countries. A universally accepted commercial law is that, you produce the commodities in which you have natural advantage over others and purchase from others in which you lack the competitiveness. Mizoram has the advantage in producing sufficient hydro power for export after meeting her own needs.
As we can see above, major hydropower projects are not luxuries in Mizoram but vital necessity. On the other hand, we should be careful in choosing which projects are to be taken up. Mizoram has not sufficient agriculture land. We cannot take up power projects sacrificing agriculture. The two need not be mutually exclusive. We need rice as well as power.
For that, we should take up power projects in rivers where their basins are not suitable for agriculture. Rivers such as Tuivai, Khawchhak Tuipui, Chhim Tuipui, Mat, Tuichang and Tlawng (upstream of Sairang village) have neither present nor future potential agriculture land. So, we should take up hydropower in such rivers.
Keeping above argument in mind, let us compare Bairabi Dam Project and Kolodyne Hydro Electric ( H.E.) Project-I (River Mat) as below-

COMPARATIVE STUDY OF BAIRABI DAM PROJECT AND KOLODYNE HYDRO- ELECTRIC PROJECT STAGE – I
BAIRABI DAM PROJECT (TLAWNG RIVER):
A. Location: 3.5 km upstream of Bairabi Village on river Tlawng,Kolasib District.
B. Installed capacity: 80MW.
C. Submergence area: 10,600 Hectares
D. Estimated cost: Rs.429 Crores (at price1999 level)
E. Details of town/village to be submerged by the project:
1) Hortoki = 365 / households
2) Meidum = 87/ households
3) Dapchhuah = 52/ households
4) Sairang =153/ households
5) Dilzawl = 36/ households
6) Tlangkhang =18/ households
F. WRC area to be submerged: 487.50 Hectares ( inclusive of legal forest area).
G. Private garden/plantation to be submerged: 3225.25 Hectares (inclusive of free hold land & within legal forest area)
H. Potential area for WRC to be submerged: From Satellite imagery, there is 3750 Hectares of potential W.R.C. area in the vicinity.
I. Jhum land to be submerged: 6149.75 Hectares (inclusive of revenue land and within legal forest area).
J. Value of private propertied to be submerged.: Rs.96.44 crores
K. Value of Government property to be submerged: Rs.32.37 crores

KOLODYNE HE PROJECT(MAT RIVER)
A. Location: Near Rotlang(E) village on river Mat, 14 km from Leite village, Lunglei District
B. Installed capacity: 120 MW
C. Estimated cost: Rs 804.60 crores at 2000 PL
D. Details of town/village to be submerged by the project: NIL
E. WRC area to be submerged: NIL
F. Private garden/plantation to be submerged: NIL
G. Potential area for WRC to be submerged: NIL
H. Jhum land to be submerged: 365.00 Hectare
I. Value of private propertied to be submerged: NIL
J. Value of Government property to be submerged: Rs 4.00 crores (NH).

The likely adverse effect of the projects in the futures development of Mizoram:
Bairabi Dam Project (Tlawng):
Bairabi Dam Project will submerge 67 km length of the most fertile and agriculture land of Tlawng and Tut valleys. The existing WRC in the submergent area of Bairabi Project is around 487.50 Ha (inclusive of inside and outside of reverine reserved forest). From Satellite imagery, another 3750 Ha of presently undeveloped area in the two valleys has the potential for development as WRC. Moreover, Bairabi Project will submerge 6150 Ha of jhum land and 3225 Ha of private teak, Hatkora, Kuva etc. gardens and plantations .Not only above mentioned lands, the future development potential of Tlawng and Tut valleys will be lost forever if the Project is executed.
Kolodyne H.E. Project Stage - I (Mat):
Mat river has no plain and fertile basin within the project and submerged area. The area is not fit for even Jhum cultivation due to steep and rocky soil profile. The proposed Powerhouse site and colony area may be suitable/ fit for jhum cultivation. But the area is very small and far away from the nearest village. Over and above, jhum cultivation is not considered important for future development of the State.
Advantage and disadvantage of constructing Bairabi & Kolodyne Projects:
Bairabi Dam Project (Tlawng):
1) Bairabi Dam Project is nearby (6km) to Rail head. So, the cost of construction will be cheaper. But this advantage will be negated by prohibitive cost of compensation for land, properties and crops. Moreover, the cost of rehabilitation of unwilling population of 6538 project affected persons will be very high.
2) The project reservoir can be utilised for navigation between Bairabi and nearby to Sairang village. But, as the project is mainly for power generation, the level of water will be fluctuated so much that construction of Wharf will be a challenge. Moreover, the narrow gorge stretch between Khamrang and Buichali Bridge will restricted the size and tonnage of the vessals.
3) Bairabi village to Sairang is the heartland of Mizoram where human development activities are concentrated. Can we afford to have human activity restricting project in the heartland?
4) Instead of constructing Bairabi Dam Project, shall we not convert Tlawng and Tut valleys as the granary of Mizoram?
5) Shall we not develop Tlawng and Tut basins in horticulture and agriculture and at the same time try for having Railway line up to Sairang for which survey is going on, so that the agricultural products can be exported to other States with minimum transportation charges? If the project is executed, this chance will be lost forever. Which will be better for Mizoram, hydropower Project at Bairabi or turning Tlawng and Tut valleys as the granary of Mizoram? Hydropower Project can be constructed in the numerous rivers that have no plain and fertile basins.
The total land requirement for Bairabi Dam Project can be shown as below :
1) Submergent area =10,600 Ha
2) Project area =75 Ha
3) Resettlement & Rehabilitation area =1290Ha
Total =11965 Hectares
Whether destroying11965 Hectares of land for generating mere 80MW is worthy the effort and investment? Moreover, the cost we have to pay in degraded environment may be too high and unacceptable.
Kolodyne H.E. Project Stage - I (Mat):
1) Kolodyne project stage-I is 301 km from the nearest rail head(Bairabi) and so the cost of the project will be high. But never the less, expenditure on compensation will be negligible and no resettlement of project affected persons will be required.
2) If Kolodyne Hydro Electric Project is taken up, National Highway from Aizawl to Leite (186km) has to be broaden and improved upon. This can be taken as incidental benefit for Southern Mizoram.
3) Due to locational disadvantage and less density of population, adequate normal development fund cannot be allocated to Southern Mizoram in general and Lunglei District in particular. This alienated people in that area and a lot of unnecessary resentment, real or imagine is created. If hydropower project costing Rs.804.60 crores is constructed in Lunglei District, the socio-economic and even political problem of the area will be solved in one stroke. Moreover, the whole of Mizoram will enjoy cheap and abundant power.
4) If Kolodyne Hydro Electric Project stage- I is taken up, Mizoram will have 120 MW power without damaging existing or potential WRC or agriculture land.
5) No village or town will be submerged by the project.
6) The total land requirement for the project is as below-
1) Submergent area=900 Ha
2) Project area = 172 Ha
3) Resettlement&Rehabilitation area = Nil
Total = 1072.00 Hectares

The degree of importance given by Govt.of Mizoram:
Bairabi Dam Project (Tlawng):Not only the Government of Mizoram but also the whole population of the State backed and pursued in whatever way possible, for execution of Bairabi Dam Project unmindful of its long term consequences to the State. Due to these collective weight, Govt.of India accorded the clearances other than on merit.
Kolodyne H.E. Project Stage - I (Mat): Neither decision makers in the State Govt. nor those in the higher echelon of power in the concerned Department are aware of the attractiveness of Kolodyne Hydro-Electric Project stage-I over Bairabi project. The project has no political or administrative backing. Getting clearances for the project will be much easier than Bairabi Project if the State Govt. give priority because –
(1) No reserved forestland will be damaged.
(2) No village or town will be submerged or displaced by the Project.
(3) Considering the possible damaged (1072 Ha) by the project and its installed capacity (120MW), it is the most cost effective hydel project in Mizoram. So, the priority given to Bairabi Dam Project over Kolodyne Project is ill- informed and misplaced.
CONCLUSION: Hence, rivers that have no fertile plains should be fully exploited for hydropower and at the same time, rivers that are endowed with fertile plains like Tlawng (downstream of Sairang) and Tut should be left alone for converting them into " Granaries of Mizoram".
Mizoram has no much WRC area. Tlawng and Tut rivers may most probably the only two rivers that have substantial fertile plain and may be the most developed river basins in Mizoram . There are not only Towns, Villages and Highways but also productive assets like Hatkora and teak plantations, WRC areas etc.. So it will be prudent to preserve and protect the few available gardens and WRC areas with its future potential.
In world history, we learned that civilisations were born and nurtured in fertile river valleys. Indus Valley Civilisation and Nile valley Civilisation are some examples. In an uncertain world, who knows the time may come when history will record that Mizo civilisation was survived only because of fertile basins of Tlawng and Tut rivers. We may not look forward to that eventuality. But, in case….
Tlawng and Tut valleys should not be submerged and destroyed by man-made deluge.

(The writer of this article is neither for nor against any project per se. This article should be treated as mental analogy for taking decision concerning a hydroelectric project. The spirit of this article is that we should not be irrationally obsessive of any particular project without assessing the long- term cost-benefit. Instead, the decision should solidly base on hard business sense without jeopardizing the long - term interest of the State).
(Kawlphetha, 2005)