Andhra govt cancels two Adani projects at company's request
Andhra Pradesh government
has cancelled two
Adani Green Energy Ltd
's (
AGEL
)
pumped hydro storage power projects
(PSP)--1,200 MW
Kurukutti
and 1,000 MW Karrivalasa--at the request of the company due to "local issues", a top official said on Monday.
In a government order (GO), Chief Secretary K Vijayanand noted that AGEL wrote to the government to cancel these projects due to boundary disputes between Andhra Pradesh and Odisha, which it termed "local issues".
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"The government, after detailed examination of the proposal of AGEL in consultation with various stakeholders, has further issued orders for the cancellation of 1200 MW Kurukutti and 1000 MW
Karrivalasa
Pumped Hydro Storage Power Projects in Parvathipuram Manyam District allotted to AGEL," Vijayanand said.
The AGEL received permission to set up these two projects during the previous YSRCP government on June 29, 2022.
The feasibility reports for these projects were prepared by the New and Renewable Energy Development Corporation of Andhra Pradesh Ltd (NREDCAP) by engaging TCE Ltd while AGEL took up the responsibility of survey and investigations and the preparation of detailed project report (DPR).
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On September 12, 2024, AGEL requested the cancellation of these two projects due to a boundary dispute between Odisha and Andhra Pradesh and requested to refund the facilitation charges paid by the company or adjust those funds towards the allotment fee due for 1000 MW Pedakota and 600 MW Raiwada PSP Projects.
The Pedaktoa and Raiwada projects were also allotted to AGEL.
Again on May 15, 2025, AGEL requested the cancellation of the Kurukutti and Karrivalasa PSP projects through a letter, said Vijayanand.
Taking into consideration the difficulties in conducting survey and investigations due to border disputes, the vice chairman and managing director of NREDCAP, M Kamalakara Babu, has requested the government to consider the cancellation of the Kurukutti and Karrivalasa PSP projects as "there is no fault on the part of the developer", AGEL, said Vijayanand.
Further, Babu also requested the approval to adjust fee paid for these projects after deducting the expenses incurred for conducting the survey and investigations by NREDCAP against facilitation fees and DPR expenses after adjusting the taxes payable, in respect of 1000 MW Pedakota PSP and 600 MW Raiwada PSP Projects.
The AGEL's cancellation proposal was placed before the State Investment Promotion Board (SIPB) meeting held on July 17 and it had agreed to cancel Kurukutti and Karrivalasa projects due to local issues as per the request of the developer, added Vijayanand.
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The Sharavathi will flow down from my cup [Talakalale] to the saucer [Gerusoppa] through tunnels, generating hydroelectricity, and will then be pumped back during off-peak hours and flow down again during peak hours to generate hydroelectricity again.' (The Talakalale reservoir is 528 metres above sea level while the Gerusoppa reservoir is merely 84 m above sea level.) The pre-feasibility report prepared in 2017 for the Karnataka Power Corporation Ltd (KPCL) said: 'The proposed Sharavathy Pumped Storage Project on Sharavathy river would perhaps be one of the biggest pumped storage schemes in the range of 2,000 MW in India. The proposed project is planned as an additional installation utilising the existing Sharavathy system consisting of Liganamakhi [sic], Talakalale Dam and Gerusoppa Dam.' (Bengaluru requires approximately 2,300 MW daily on average, which puts the scale of the project in perspective.) 'The proposal was pushed through because of political pressure even though the Karnataka Forest Department was reluctant to give clearance for the project.'Joseph HooverWildlife activist and former member of the SBW This PSP, if built, will be a significant addition to the cumulative energy output of Karnataka considering that the State's largest hydroelectric project to date is the Sharavathi Hydroelectric Generating Station with an installed capacity of 1,035 MW a day, but this is not the only hydroelectric project on the Sharavathi, which originates in Thirthahalli taluk of Shivamogga district in the Western Ghats and flows westwards for 128 km. Power is also generated along its course at Linganamakki Dam, Mahatma Gandhi Hydroelectric Station, and Gerusoppa Dam before the river's tail water flows into the Arabian Sea. As per the 219-page pre-feasibility report, the Sharavathi PSP 'envisages to utilise the existing Talakalale dam as upper dam and Gerusoppa as lower dam without any modification in these structures'. Thus, while no new dams will be constructed, the PSP does plan the construction of 14 km of concrete-lined underground tunnels and an underground pump house containing eight generating units and turbines of 250 MW each. (As per a power sector analyst, each generating unit is as large as an independent house.) The project was estimated to cost Rs.4,862.69 crore in 2017, but in the Karnataka Budget of March 2025, the outlay was increased to Rs.10,240 crore. Back in 2017 when the plan was first mooted, the site of the proposed project was a reserve forest; the zone's protection has since been enhanced after it became a part of the Sharavathi LTM Wildlife Sanctuary whose expansion was notified in 2019. Despite this, the project was approved by the Karnataka State Board of Wildlife (SBW) and the Central Electric Authority (CEA) in 2024. Joseph Hoover, a wildlife activist and former member of the SBW, said the proposal was 'pushed through because of political pressure even though the Karnataka Forest Department was reluctant to give clearance for the project'. Crucially, the Sharavathi PSP also received an 'in-principle' nod from the Standing Committee of the National Board of Wildlife (SC-NBWL) on June 26 this year although it was subject to the fulfilment of 28 conditions, including pivotal forest, wildlife, and environmental clearances from the Union Ministry of Environment, Forest and Climate Change. Strangely, the in-principle approval was granted despite a negative site inspection report by Praneetha Paul, a senior Indian Forest Services officer. In her report submitted in May, Paul did not recommend the project because the Sharavathi PSP would have a massive impact on the unique forest habitat of the Western Ghats and lead to the destruction of rare, endangered, and endemic species. According to the minutes of the critical SC-NBWL meeting, the Sharavathi PSP proposal was recommended by the Chief Wildlife Warden of Karnataka, the SWB, and the Karnataka government for the 'use of 42.51 hectares of forest land and 60.534 hectares of non-forest land from the Sharavathi Valley LTM Wildlife Sanctuary and 11.645 hectares forest land and 28.074 hectares from the eco-sensitive zone around the sanctuary…'. It added that 'about 15,000 trees are going to be cut for construction of road'. Justifying the proposal in the meeting, Subhash K. Malkhede, the Chief Wildlife Warden of Karnataka (retired since then), stated that '…it is a green project which will not have much ecological impact on the area'. (Interestingly, Malkhede stated that 'solar power' would be used to pump water, but Paul mentioned in her report that both 'thermal/renewable energy resources' would be used.) Striking a note of caution during the proceedings, Raman Sukumar, a member of the SC-NBWL and a noted elephant ecologist, mentioned that the wildlife sanctuary was a 'densely forested area... housing the maximum population of lion-tailed macaques in the entire Western Ghats…. The proposal should be carefully examined in detail [along with] a thorough environmental impact assessment…' Chippali flagged the concerns the environmentalists had with the Sharavathi PSP: 'A population of around 730 lion-tailed macaques, an endangered species, resides in the wildlife sanctuary. The Western Ghats are a UNESCO World Heritage Site with dense natural tropical forests. How can this project be approved in a wildlife sanctuary destroying 350 acres when Section 29 of the Wild Life (Protection) Act [of 1972] clearly prohibits this?' Hoover, who visited the proposed construction site inside the Sharavathi LTM Sanctuary in 2024, said: 'The area beyond Begodi where the KPCL team has done preliminary drilling is in the pristine old growth Western Ghats forests which can never be replaced. The destruction of this forest will lead to ecological imbalance.' Nirmala Gowda, an ecological activist and researcher, objected to the SC-NBWL's approval on several grounds. In a note that she shared with Frontline, she listed these in detail: The 'in-principle' approval was beyond the legal authority of the SC-NBWL; it violated Supreme Court rulings and clearance procedures in assessing project alternatives; ignored landslide risks and geological instability of the area as the proposed project site falls within moderate to high landslide susceptibility zones as identified by the Karnataka State Natural Disaster Monitoring Centre; the PSP would lead to a loss of significant and irreplaceable natural carbon stocks and sequestration capacity; it undermined the escalating loss of biodiversity; and the land identified for compensatory afforestation violates the Compensatory Afforestation Rules as it lies in the buffer zone of the Bhadra Tiger Reserve, which is already a forest. Shankar Sharma, an electrical engineer who has been closely associated with the power sector for more than 44 years, including a 9-year stint with the CEA, was visibly angry with the idea of the PSP. Around 20 years ago, Sharma had walked along the entire length of the Sharavathi river from its source in Ambuthirtha to Honnavara, where the river spills into the Arabian Sea, studying the riverine ecosystem and engaging with the communities that live alongside. It is this deep sense of connection he developed with the Sharavathi river and the Western Ghats that has compelled Sharma to consistently campaign against the project since 2019. Sharing a tranche of emails that he has written to various authorities over the years, Sharma said: 'It is a tragedy that the SC-NBWL has not cared to question the true relevance of the project proposal before giving the 'in-principle' approval. The amount of electricity required to pump a certain quantity of water from a lower reservoir to the higher reservoir in a PSP will be approximately 24 to 25 per cent more than the electricity that can be generated from the same quantity of water stored in the upper reservoir. The cost-to-benefit ratio of this project is less than one.' This fact is borne out in the 2017 pre-feasibility report that stated that 12,000 MWh (megawatt-hour) of energy will be generated by the Sharavathi PSP, while 14,833 MWh of energy will be required to pump the water upstream. Sharma also made a shocking accusation against the Karnataka government, which has demonstrated great eagerness to implement this PSP despite the dire ecological problems. 'The tender for this project was bagged by a company in 2024 without all the clearances,' he said. 'Even now forest, wildlife, and environmental clearances are pending. Why this great hurry? How can the construction contract be awarded without the availability of a Detailed Project Report [DPR] to assess the cost? Something was seriously wrong with the tender allocation procedure and there must have been extraneous considerations. Check the electoral bonds bought by the company and you can connect the dots.' Sharma's insinuation of corruption stemmed from the controversy surrounding the allotment of the construction tender to Megha Engineering and Infrastructure Ltd (MEIL) by KPCL. In 2024, Larsen and Toubro, another bidder, approached the Karnataka High Court and the Supreme Court citing irregularities in the award of the tender to MEIL, but the plea was dismissed. Notably, MEIL was the second biggest purchaser of electoral bonds, worth Rs.966 crore as per data released by the Election Commission of India in 2024. Chippali alleged that the project is just an avenue to mint money. Hoover said: 'The lure of big money has blinded Karnataka Energy Minister K.J. George, who has ironically been promoting renewable energy alternatives.' In a press conference on June 28, George stated that the DPR 'for the Sharavathi project has already been approved by the Central Electricity Authority' although Chippali said that his RTI application for this document was unsuccessful. Also Read | Karnataka: The southern outlier Sharma asked: 'Let us assume that the DPR was ready last year [2024] and has been hidden from the public. Why should the DPR be hidden from the public if it is a public sector undertaking? What does the government want to hide?' In an earlier statement, also in June, George dismissed the protests of the environmentalists: 'Only a few environmentalists are raising objections. If the project is executed, it will generate 2,000 MW of power along with a proper storage facility. All pipes and cables will be laid underground.' At a function to mark the 56th anniversary of KPCL on July 23, George said: 'Even though a satisfactory amount of power is being generated in Karnataka, there is no facility to store this. Therefore, the government has decided to go ahead with the Sharavathi PSP and the Varahi PSP (of 1,500 MW). Through this, power can be stored and can be used whenever there is a surge in demand.' Responding to the push for PSPs in the Western Ghats, Nirmala Gowda organised a two-day knowledge summit in June in Shivamogga, which was attended by environmental researchers, lawyers, campaigners, local community representatives, and civil society organisations. The participants decided that while PSPs in the Western Ghats may be necessary for transition to renewable energy, they must be located outside wildlife sanctuaries and ecologically sensitive areas. Assessing the contribution of these power generation projects, Gowda said that the 'Western Ghats must not be treated as a power plant' and that there were numerous preferable alternatives. 'There are location alternatives, energy storage technology alternatives such as battery energy storage systems, and strategies to flatten peak electricity demand through a combination of regulatory measures and enabling technologies. All these options are outlined in the National Electricity Plan 2023 and represent viable, less ecologically damaging alternatives to large-scale PSPs in sensitive forest and wildlife areas.' For Gowda, the issue is a deeply emotional one. She spent several weeks last year travelling through the Western Ghats speaking to a wide range of stakeholders. She told Frontline: 'Undermining the sanctity of the last frontier of biodiversity is a profound failure to recognise multispecies justice. Earth is not ours alone; it is a shared home, where every species holds an intrinsic right to exist.' Back in Marathi Keri, Gururaj walked up to a flaring red ribbon tied to a branch, which marks the area required for the Sharavathi PSP in his village. His aunt Nagarathna, an elderly woman in her 70s, looked on forlornly at the bewitching Sharavathi river valley spread out before her and said that if she was forced to relocate, it would be the second time in her life; the first time was in 1964 when Linganamakki Dam was constructed upstream on the Sharavathi. Her words highlighted the historical price that humans, forests, and wildlife have paid for energy projects that seek to harness the rivers of the Western Ghats. So far, this paltry piece of red fabric is the only indicator of the looming gigantic engineering project that has been envisaged in the virginal terrain of the Sharavathi LTM Sanctuary but if one were to read the blowing cloth as a semaphore, the signs were ominous. (Frontline reached out to Karnataka Minister of Energy K.J. George for his response to the concerns raised by environmental activists. A detailed questionnaire was mailed at the request of his office, but no response had been received at the time of going to press.)
