NHPC Subansiri project faces 345% cost overrun

A Parliamentary Standing Committee has flagged a 345% cost overrun for NHPC Limited's 2,000 MW Subansiri Lower Hydroelectric Project, located on the border of Assam and Arunachal Pradesh. The project's estimated completion cost has surged to Rs 27,948.52 crore from the original Cabinet Committee on Economic Affairs (CCEA) approved amount of Rs 6,285.33 crore.

The cost escalation has significantly impacted the expected electricity price, with the levelised tariff rising from Rs 1.93 per unit to Rs 7.49 per unit. NHPC attributed the delays to local agitations, work stoppages, a National Green Tribunal stay, the COVID-19 pandemic, and adverse environmental events.

In response, the Committee on Public Undertakings recommended that the Ministry of Power implement a proactive quarterly monitoring framework. This framework would apply to all projects experiencing schedule or financial variances of 20% or more, with such cases escalated to a Secretary-level monitoring group to improve stakeholder management and coordination.