Assessment of Investment Worthiness of Hydro Electric Projects

Determination of investment worthiness of new hydro project is of paramount importance for developers. General tendency is to look at tariff and other financial parameters as tariff is supposed to encompass all peculiarities of a project. In actual scenario, the project cost and time get increased with impact in tariff due to various risk mitigation measures. Social issues could not be quantified properly to embed the same in project cost and tariff. Some projects suffer in midway path of construction due to social and displacement issues. It is felt that one exhaustive method with structured approach should be applied to investigate investment worthiness. In this paper, a method of investigation has been introduced with examination of four different main parameters with a host of sub-parameters. The main parameters are Administrative, Engineering & Geology, Commercial and Social. The parameters, sub-parameters, and respective weightages can be modified and some additional parameters/sub parameters could be brought in as per wisdom of the assessor. The method with further refinement shall also be helpful in carrying out ranking study of a series of projects.