The Ministry of New and Renewable Energy (MNRE) has issued operational guidelines for the implementation of the Small Hydro Power (SHP) Development Scheme with a total outlay of INR 2,584.60 crore for the period FY2026-27 to FY2030-31. The scheme aims to facilitate the development of around 1,500 MW of new small hydro capacity across the country.
Under the scheme, small hydro projects ranging from 1 MW to 25 MW will be eligible for central financial assistance (CFA). The initiative is expected to accelerate renewable energy deployment, especially in hilly regions, North-Eastern states, and remote areas where small hydro projects can improve energy access and grid reliability.
As per the guidelines, projects located in North-Eastern states and international border districts will receive financial assistance of up to 30 percent of the project cost or INR 3.6 crore per MW, subject to a maximum of INR 30 crore per project. Projects in other regions will be eligible for support of up to 20 percent of project cost or INR 2.4 crore per MW, capped at INR 20 crore per project.
MNRE has designated the Solar Energy Corporation of India (SECI) as the National Programme Implementing Agency for the scheme. Developers will be required to secure statutory approvals, including forest, wildlife, irrigation, pollution control, and grid connectivity clearances before availing benefits under the programme.
The ministry has also included support for preparation of Detailed Project Reports (DPRs) for at least 200 projects during the scheme period. The government expects the initiative to attract investments of nearly INR 15,000 crore and generate significant employment opportunities in the renewable energy sector.
