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Himachal Pradesh: Sukhu Govt Moves Bill To Levy Water Cess On Hydro-Power Projects

The Himachal Pradesh government aims to raise Rs 4,000 crore per annum through the cess payable on the water being utilised by the power generation companies, which are having projects in the state.

In picture Bakhra Dam in Himachal Pradesh. (Representative image)
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Going high on its agenda to raise resources, the Sukhvinder Singh Sukhu-led Congress government on Tuesday introduced the Himachal Pradesh Water Cess on Hydropower Generation Bill 2023 in the Vidhan Sabha

The Bill aims to replace an ordinance that the governor passed on February 15, 2023, in this regard.

The state government aims to raise Rs 4000 crore per annum through the cess payable on the water being utilised by the power generation companies, which are having projects in the state.

Himachal Pradesh has a power potential of 27,000 MW. Currently, the state is generating/supplying nearly 12,000 MW of power from 172 hydro-power projects. Some of the big PSUs like BBMB, NHPC and NTPC besides Satluj Jal Vidyut Nigam (SJVN) Ltd are producing power in the state.

Deputy Chief Minister Mukesh Agnihotri, who holds the portfolio of water (Jal Shakti) piloted the bill in the assembly, which began its budget session on Tuesday.

Introducing the landmark Bill, he said the water flowing in the rivers and tributaries of the state can generate income, besides meeting the power needs of the state and country.

This cess on electricity generation was also levied by the states of Uttarakhand and Jammu and Kashmir.

There is a huge debt burden of Rs 75,000 crore on the state and income from this source could immensely benefit Himachal Pradesh.

He made it clear that the cess will not have any burden on the general public. It is wrong to say that the state government was raising taxation burdens. The fact remains that the whole idea is to increase the state's income and use the money for development.

Apart from this Bill, work will also be done on other sources of increasing income. More steps will be taken in this regard in the coming times.

Speaking on the matter, Chief Minister Sukhvinder Singh Sukhu told Outlook, “It’s a well-thought move. The discussions have been held at various levels including some of the stakeholders. The  BBMB Chairman visited Shimla some days back. We had held talks with NTPC and NHPC as well."

Sukhu is slated to present his first budget for the year 2023-24 on March 17 but before this, the state government had initiated a lot of steps to increase income.

The liquor bottles will cost Rs 17 each and entry to the state for vehicles having registration numbers from outside Himachal Pradesh will have to pay more from April 1.

All moves to increase the income are also designed to meet heavy expenditures on fulfilment of the promises like OPS made by the congress during the poll.

As per provisions of the bill, the government will set up a State Commission for Water Cess to discharge the functions under the Act. The annual expenditure on this will be Rs 23 crore.

State’s Chief Secretary will head the Commission which will have no more than four members. Their tenure will be fixed up to three years subject to the maximum age limit of 65 years.

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