GANGTOK: The Union Ministry of Environment, Forest and Climate Change (MoEF&CC) has approved the proposal for rebuilding the Teesta-III dam, despite concerns over its design and stability. The original 1,200 MW Teesta-III Chungthang hydroelectric dam was destroyed in a Glacial Lake Outburst Flood (GLOF) on October 4, 2023.
In a meeting held on January 10, 2025, the Environment Ministry’s Expert Appraisal Committee (EAC) raised concerns about the extensive damage caused by the flood, including the washing away of the dam structure and the severe flooding of the underground powerhouse, which brought operations to a halt.
However, the project proponent, Sikkim Urja Ltd (SUL), assured the EAC that, aside from the dam, most other components of the project could be restored to their original condition within a year, according to the meeting minutes.
The company proposed altering the dam design from a concrete-face rockfill dam—a commonly used structure worldwide—to a concrete gravity dam, a design that relies on its own weight to bear loads. The company claimed that this new design would offer greater resilience to flash floods and GLOFs.
The Environment Ministry’s approval of the reconstruction project has sparked opposition from political parties and environmentalists, who have criticized the state government for not considering the views of those affected by the GLOF. On February 5, following a legislative assembly session, Sikkim Chief Minister Prem Singh Golay justified the decision to rebuild the Teesta Stage-III dam.
Golay highlighted that the previous government had taken huge loans amounting to ₹3,200 crores to construct the Chungthang dam. However, the revenue generated from the project was insufficient to repay the loan. “During lean periods, like January-February, when river flow decreases, our revenue also declines. When the GLOF occurred and the dam burst, we feared the project would be declared a non-performing asset, and the government’s 60.08% share in the project would have been lost,” Golay stated.
The Chief Minister also revealed that the state government had sought a loan waiver from the central government, but the request was not supported. “We requested the Government of India and two financial institutions to waive our loans, given the massive losses we suffered, and to provide subsidies. However, the Government of India did not agree. They urged us to repay the loan, although they assured other forms of support under the National Disaster Management Authority,” Golay explained.
As a result, the Chungthang dam has been awarded to Greenko, which was the second-largest shareholder in the previous Teesta Stage-III hydroelectric project. “This decision was made in the best interest of the state. Greenko was the second-largest shareholder, and it was the previous government that had entered into an agreement with them. If the government’s shares had to be transferred, they had to go to Greenko. After valuation, we handed over the project to them. Now, we are free from the burden of loans,” Golay stated.
Golay also clarified that the Teesta Stage-III dam, like other hydroelectric power plants in the state, will provide 12% free electricity to Sikkim, and with the loan burden removed, the state is now debt-free.
“If we had retained the state government’s share and if the previous project had functioned properly until 2047, we would have received no revenue and would have remained unable to repay the loan taken by the previous government,” Golay concluded.
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