CAG says Kaleshwaram project will require ₹10,374 crore towards energy charges every year 

The Kaleshwaram project in Telangana requires ₹10,374 crore towards energy charges every year and a significant amount of power. CAG report on it was tabled in the State Legislative Assembly.

The much-publicised Kaleshwaram project will require 8,459.1 MW power working out to 46.82% of the total installed capacity available in Telangana.

The project would require a total of 14,344 million units of energy every year after completion. The peak energy demand when all the pumps are likely to be operated simultaneously during the pumping season works out to 203.02 MU per day. “This is more than the daily average energy availed in the entire State in 2021-22,” the Comptroller and Auditor General of India said.

The annual recurring cost on electricity charges was understated by adopting a lower rate of ₹3 a unit whereas the prevailing tariff for lift irrigation schemes was ₹6.4 a unit. As the State was presently purchasing/importing nearly 60% of energy from external sources, providing power to various lift irrigation projects, including Kaleshwaram, would be a challenge to the State, the CAG said in the performance audit report of Kaleshwaram project tabled in the Telangana Legislative Assembly on Thursday.

The CAG said the project would require ₹10,374 crore towards energy charges every year. In addition, there would also be annual operation and maintenance cost of ₹272.7 crore. Thus, the commitment on the annual operational costs of the project would be ₹10,647 crore per year working out to ₹46,364 an acre.

In addition, there would be depreciation on project works which worked out to ₹2,760 crore a year. The report said the project cost was estimated at Rs. 81,911 crore but the State Government had not accorded administrative approval for the project as a whole. Instead, the Government had been issuing separate approvals for individual works on piece meal manner.

“As of March 2022, as many as 73 administrative approvals aggregating to ₹1.1 lakh crore were given. There were no orders from the Government about the funding pattern for the project,” the report said. Out of the total expenditure ₹86,788 crore incurred on the project as of March 2022, an expenditure of ₹55,807 crore (64.3%) was met from the off budget borrowings raised by the KIPCL. Out of the total expenditure incurred after re-engineering, as high as 72.82% was met from off budget borrowings and only 27.18% was met through budgetary allocations.

The CAG said the DPR however stated that there were no proposals for water levy at present and hence, the revenue from water charges could be taken as nil. The revenues from supply of industrial drinking water and fisheries would also be negligible and thus the entire operational cost of the project should be borne by the Government/Kaleshwaram Lift Irrigation Corporation Limited.