Union Cabinet approved the Small Hydro Power Development Scheme

The Union Cabinet approved the Small Hydro Power (SHP) Development Scheme for the period FY 2026–27 to FY 2030–31.

Total outlay: ₹2,500+ crore (approx. ₹2,584 crore).

Target: Development of ~1500 MW capacity through small hydro projects.

Focus areas: Remote, rural, hilly, and North-Eastern regions.

Features of the Scheme

Covers Small Hydro Projects (SHP) with capacity between 1 MW to 25 MW.

Provides Central Financial Assistance (CFA):

Up to ₹3.6 crore per MW or 30% of project cost (whichever is lower)

Maximum limit: ₹30 crore per project (special support for NE and border areas)

Encourages preparation of Detailed Project Reports (DPRs) for around 200 projects.

Promotes run-of-the-river projects (minimal environmental impact, no large dams).

Objective & Significance

Boost renewable energy capacity and reduce dependence on fossil fuels

Provide decentralized power supply in remote regions

Support energy security and grid stability

Promote sustainable and eco-friendly power generation

Additional Facts

Small Hydro Power (SHP): Projects up to 25 MW capacity.

India’s estimated SHP potential: ~20 GW.

First hydro project in India: Darjeeling (1897).

Implementing Ministry: Ministry of New and Renewable Energy (MNRE)

Part of India’s broader push toward clean energy transition and Net Zero goals