Madhya Pradesh Pumped Hydro Storage (PHS) Project Scheme
Sharda Associates is a CA firm based in Bhopal, Madhya Pradesh, with 45,500+ project reports delivered across India. We provide complete end-to-end consultation for PHS project developers—covering feasibility reports, financial planning,
Introduction
Introduction to the Scheme & How Sharda Associates Helps You
Madhya Pradesh Pumped Hydro Storage (PHS) Project Scheme is a state government initiative to develop large-scale renewable energy storage infrastructure using the state’s hydro potential of 7 GW. The scheme offers major incentives including electricity duty exemption, stamp duty reimbursement, and wheeling charge waivers to attract domestic and international investors.
Sharda Associates, a CA firm based in Bhopal, with 45,500+ project reports delivered, provides end-to-end consultation for PHS project developers — from feasibility reports and financial planning to subsidy applications and regulatory compliance.
Narendra Modi
Prime Minister India​
Dr. Mohan Yadav
Chief Minister Madhya Pradesh
Storage (PHS) Scheme
What is the MP Pumped Hydro Storage (PHS) Scheme
The MP PHS Scheme, launched by the Government of Madhya Pradesh, aims to harness the state’s river and off-river hydro potential to build energy storage facilities that support renewable energy grid integration. The scheme allows four development modes:
- Mode-I — Allotment to CPSUs and State PSUs on nomination basis
- Mode-II — Projects for power exchange or captive consumption
- Mode-III — Projects for power procurement by MPPMCL through competitive bidding
- Mode-IV — Self-identified off-stream projects
MPPMCL has the Right of First Refusal to purchase up to 100% capacity under Mode-I and 50% under Mode-IV.
Benefits
Key Incentives and Benefits Under MP PHS Scheme
The policy offers substantial incentives for companies setting up logistics and warehousing units in Madhya Pradesh. Below are the major benefits:
1. Electricity Duty Exemption
100% exemption on electricity duty for 10 years from the date of commissioning. This directly reduces operating costs for pumped hydro storage developers.
2. Stamp Duty Reimbursement
65% reimbursement on stamp duty for private land purchases, significantly lowering the upfront land acquisition cost.
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3. Wheeling Charges Waiver
50% waiver on wheeling charges for 5 years. Projects supplying power to MPPMCL get complete wheeling charge exemption.
4. Government Land Subsidy
Land available at 35% of the guideline rate for Mode-III projects, making large-scale development financially viable.
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3. Wheeling Charges Waiver
20% discount on registration and facilitation fees, reducing administrative costs.
4. Transport & Freight Assistance
Financial assistance available for land acquisition and community resettlement under the scheme.
5. Registration & Facilitation Fee Exemption
PHS project developers can claim carbon credits for emission reduction, adding a revenue stream while improving sustainability credentials.
6. Rehabilitation & Resettlement Support
10-year exemption from the Energy Development Cess, further improving the project’s long-term financial viability.
Eligible Investors
Who Can Apply? Eligible Investors
The MP PHS Scheme is open to:
- Central Public Sector Undertakings (CPSUs) and State PSUs
- Independent Power Producers (IPPs)
- Renewable energy companies
- Private developers and industrial units
- International energy corporations
Both on-river and off-river project types are eligible. Hybrid solar + PHS projects and captive PHS projects for industrial use are also covered.
Types of PHS Investment
Types of PHS Investment Opportunities in Madhya Pradesh
The policy is open to domestic and international investors, focusing on:
Captive PHS Projects for Industrial Use
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Helps PHS Project Developers
How Sharda Associates Helps PHS Project Developers
Sharda Associates provides complete end-to-end support for pumped hydro storage project development in Madhya Pradesh:
- Feasibility Report & DPR — Detailed project reports accepted by banks and government agencies
- Financial Planning & CMA Data — Accurate financial modelling for loan applications
- Subsidy Application Support — Guidance on all applicable incentives under the MP PHS scheme
- Land Acquisition & Licensing — Documentation and regulatory compliance support
- Single-Window Clearance Assistance — Helping clients navigate MP government approvals faster
- Bank Loan Facilitation — CA-certified reports for project finance
Our team of Chartered Accountants has delivered 45,500+ project reports across India with 24–48 hour turnaround on standard deliverables.
FAQ
Frequently Asked Questions
The MP PHS scheme is a state government initiative to develop pumped hydro energy storage projects using Madhya Pradesh's 7 GW hydro potential. It offers incentives like electricity duty exemption, stamp duty reimbursement, and wheeling charge waivers to attract investors.
CPSUs, State PSUs, Independent Power Producers (IPPs), private developers, renewable energy companies, and international energy corporations are all eligible to apply under the MP PHS scheme.
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Eligible PHS projects get 100% exemption from electricity duty for 10 years from the date of commissioning.
Developers get 65% reimbursement on stamp duty paid for private land purchases under the MP PHS scheme
The policy has four modes — Mode-I (CPSU/State PSU nomination), Mode-II (power exchange or captive use), Mode-III (MPPMCL competitive bidding), and Mode-IV (self-identified off-stream projects).
Yes. Land is available at 35% of the guideline rate for Mode-III projects. This significantly reduces upfront investment for large-scale developers.
Yes. PHS project developers can claim carbon credits for emission reductions, providing an additional revenue stream alongside power generation.