GUIDELINES FOR THE PREPARATION OF FEASIBILITY REPORTS FOR POWER PROJECTS PROJECT APPRAISAL DIVISION PLANNING COMMISSION GOVERNMENT OF INDIA NEW DELHI APRIL, 1992PREFACE ‘The quality of appraisal, investment decision and success of the projects depend largely on the quality and content of the Feasibility Report (FR). It is in this context that the Planning Commission had earlier issued guidelines for the prepration of FR in 1966 and later in January, 1975. The 1975 version of the guidelines relates to the industrial projects but the same has been in use for other sectors as well to the extent possible. Despite the emphasis on proper feasibility study, a number of cases of time and cost over-run have been encountered in the projects almost in all sectors of the economy. The issue was also considered by the Committee on Public Undertakings (COPU) 1981-82 (Seventh Lok Sabha). In the light of the shortcomings observed in the quality of FR submitted by the project authorities, the Committee desired that on the basis of the experience gained and feed-back on implementation obtained, revised guidelines for preparation of FRs should be issued to ensure reliable project formulation. Following the above recommendations, Working Groups for formulation of revised sector-specific guidelines were set up by the Planning Commission for seven sectors/subsectors, namely, Coal, Power, Cement, Paper, Engineering, Metallurgical and Process Industries. Based on the drafts developed by these Working Groups, comments received from concerned Ministries/Organisations and discussions held with themi, these Guidelines have been prepared. In these Guidelines, the term Detailed Feasibility Report (DFR) has been used in place of FR, mainly to emphasise the need for detailed information to enable proper appraisal of the investment proposal. ‘The Guidelines mainly outline the information required for proper formulation and appraisal of projects. Any procedures and criteria/parameters as may be specified by the Government from time to time have also to be taken into consideration while. formulating and appraising projects. While efforts have been made to incorporate various improvements in the guidelines, these cannot be taken as the final word. on the subject as project formulation is a dynamic process and depends on the state of knowledge which gets enriched with time. Any suggestions to improve these guidelines are, therefore, welcome. (ere ate New Delhi, (Dr. Uddesh Kohli) April 30, 1992 Adviser (Project Appraisal)Chapter - 1 Chapter - 2 Chapter - 3 Chapter - 4 Chapter - 5 Chapter - 2 Chapter - 3 Chapter - 4 Chapter - 5 Chapter - 2 Chapter -3 Chapter ~4 Chapter -5 CONTENTS, INTRODUCTION THERMAL POWER PROJECTS Advance Action Proposal Studies ‘and Investigations Detailed Fessibility Report Revised Cost Estimates HYDROELECTRIC PROJECTS ‘Advance Action Proposal Studies and Investigations Detailed Fessibility Report Revised Cost Estimates TRANSMISSION PROJECTS Advance Action Proposal Studies and Investigations Detailed Fessibility Report Revised Cost Estimates Page 98 101 154