The Economics of Mullaperiyar

Col. John Pennycuick was the architect and engineer responsible for the construction of the Mullaperiyar dam during the eight year period from 1887 to 1895. He presented a paper titled 'Diversion of the Periyar' before the Institute of Civil Engineers on 26th January, 1897. According to this report, the total cost of the Periyar works was Rs. 85 lakhs. Of this Rs. 60 lakhs was spent on the dam and Rs. 25 lakhs on the distribution channel in Madura district.  Of the Rs. 60 lakhs spent for the construction of the dam, the cost of the main dam was Rs. 30 lakhs while the watershed cutting and tunnel cost Rs 8 lakhs.

The report mentions that the main dam contained about 6,000,000 cubic feet of masonry (costing Rs. 3 lakhs).

Estimated return from irrigation revenue only (for 30 tmc of water), as mentioned, was Rs. 7.2 lakhs annually with net return of 6.5% (after deducting Rs. 40,000 to be paid to Travancore and after deducting other maintenance charges). He had also suggested that the diverted waters could be used for generating approx 60,000 HP of hydro-electric energy. This could provide additional revenue estimated around Rs. 6 lakhs per annum, to be used initially for mining purposes until the villages were ready for electricity.

In 1956 Tamilnadu constructed the Lower Periyar Power Station with installed capacity of 140 MW utilizing the diverted waters of the Periyar. The Power Station has 4 turbines of 35 MW each that are driven from the diverted Periyar waters fed through the penstock pipes.

The fourth turbine has been upgraded to 42 MW in July 2011. The power generated from Lower Periyar brings in revenue of around Rs. 300 crores to Tamilnadu annually.

Though originally the 30 tmc of water diverted from Periyar was to irrigate 100,000 acres of land, today 70 tmc to 90 tmc of water is diverted to irrigate 250,000 to  300,000 acres of land in Tamilnadu.

In 1970 Tamilnadu and Kerala agreed to revise the lease rent to Rs. 2.5 lakhs and to regularize the generation of electricity from the diverted waters and to pay for the generation of electricity (with payment of around Rs. 12 lakhs annually to Kerala). The rates were to be revised after 30 years. Tamil Nadu has not entered into a revised agreement with Kerala, while Tamil Nadu continues to draw more and more water for electric generation, irrigation and drinking water supply from the waters diverted from Mullaperiyar.  Tamilnadu wants the water level to be raised to draw more and more water from Mullaperiyar mainly for power generation.

Tamilnadu is the main beneficiary of the dam, though it has no riparian rights over the waters. But it wants more and more water from an aging and endangered dam.  Is Kerala catering to the need or greed of Tamil Nadu? Should not Tamil Nadu reasonably compensate Kerala for the waters diverted from Kerala? At least should not Tamil Nadu care for the safety of the Kerala people and support Kerala building a new dam to replace the old and ailing dam, so that it continues to get the benefits it currently gets from Mullaperiyar?

-Joseph Ponnoly