PSUs turn to joint ventures with states to beat land hurdles in solar projects
Why in news?
Public sector power companies are increasingly forming joint ventures (JVs) with state governments and state agencies to secure land and fast‑track large solar projects, because land is a state subject and conventional acquisition has become a major bottleneck.​
About
- Central PSUs such as NHPC, SJVN and NTPC Green Energy Ltd (NGEL) have started floating state‑specific JV companies with state governments or their nodal renewable agencies to develop utility‑scale solar projects.
- Under this model, PSUs bring capital and project expertise, while states contribute land and facilitate clearances, giving states an equity stake and a direct interest in quick execution.​
Why land is a hurdle
- Utility‑scale ground‑mounted solar projects need large contiguous tracts, typically around 4–7 acres per MW, leading to a huge cumulative land requirement for India’s long‑term solar targets.
- Much of the technically suitable land overlaps with fertile agricultural areas or ecologically sensitive zones, and fragmented ownership plus varying compensation norms across states further delay acquisition and trigger disputes.​
How JVs help overcome hurdles
- By partnering with states, PSUs can access pre‑identified government land or coordinated private land parcels, reducing litigation and pre‑construction delays flagged in CAG and Parliamentary Standing Committee observations.
- The PSC has noted that such JVs improve coordination on land approvals and has also recommended single‑window mechanisms to resolve land issues in a time‑bound manner.​
Policy context
- The Ministry of New and Renewable Energy’s Solar Parks scheme already recognises JV models between central PSUs and state nodal agencies or SECI for park development, with financial support for internal and external infrastructure.
- MNRE has told the Parliamentary panel that identification and allocation of government land by states is the “simplest way” to speed up renewable project implementation, and it has been urging states to create such land banks.​
Trends and examples
- Several states like Uttar Pradesh, Rajasthan and Gujarat are separately creating land banks and policies to earmark government land for renewable energy, complementing the PSU–state JV approach.
- Alongside JVs, MNRE has also simplified approval processes for solar parks developed by central PSUs and their JVs by exempting their DPRs from state committee vetting, to accelerate park development.​
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