Prime Minister Narendra Modi today will lay the foundation stone of a 50 MLD Sewage Treatment Plant (STP) based on hybrid annuity-PPP model in Ramana in Varanasi.
“In a first, hybrid annuity-PPP is adopted in sewage sector. It is a major step towards realising the dream of Nirmal Ganga under Namami Gange programme,” said the Ministry of Water Resources.
The work to construct, operate and maintain the STP is given to a consortium led by Essel Infra Projects Limited at an estimated cost of Rs 153.16 crore.
The Government had accorded Cabinet approval to implement the hybrid annuity-PPP model with 100% central sector funding. Under this model, the development, operation and maintenance of the STP will be undertaken by a Special Purpose Vehicle (SPV) at the local level. Moreover, 40% of the capital cost would be paid during construction while the remaining 60% of the cost will be paid over the life of the project as annuities along with operation and maintenance cost (O&M) expenses for the next 15 years.
The Ministry added, “One of the most important features of this model is that both the annuity and O&M payments are linked to the performance of the STP to ensure optimal performance.”