The Odisha state government has released operational guidelines for its Pumped Storage Hydro Projects (PSPs) Policy-2025, designed to accelerate energy storage infrastructure and facilitate smoother integration of renewable energy into the grid.

The Energy Department stated that the guidelines provide a structured framework for project implementation, monitoring, and evaluation, while encouraging investment from both government and private sectors. The Grid Corporation of Odisha Limited (GRIDCO) will act as the nodal agency for allocation of self-identified and state-identified sites, with 45 potential PSP locations already identified.

All projects will follow the build-own-operate-transfer (BOOT) model, with a 40-year concession period extendable by 30 years. Post-concession, the projects will be transferred to the state government, except for captive PSPs, which will retain their status as captive generating projects (CGP).

Projects under the policy will receive all benefits under the Odisha Renewable Energy Policy, 2022 (OREP-22), along with exemptions such as no electricity duty or cross-subsidy surcharge on input energy, no water cess for non-consumptive use, and no obligation for free power or contributions to the Local Area Development Fund (LADF). Developers are also eligible for central budgetary support and full renewable energy incentives if energy input is sourced from in-state renewables, with no penalties for sourcing from outside Odisha. Projects availing IPR incentives cannot claim benefits under this policy or OREP-22.

Deputy Chief Minister and Energy Minister Kanak Vardhan Singh Deo said the policy is a vital step toward grid stability and achieving Net Zero goals. “With its PSP Policy, Odisha is laying the groundwork for a resilient, renewable-powered future. This marks a decisive step toward sustainable growth and climate-conscious development,” he added.