Koyna river rises in the Mahabaleshwar, a famous hill station in the hill range of  Sahyadri. It flows in a north - south direction almost parallel to the Arabian Sea coast for a distance of 65 Kms. from Mahabaleshwar to village Helwak, skirting King Shivaji's Fort at Pratapgadh then, near village Helwak, it turns sharply eastwards to join river Krishna at Karad which is 56 Kms. from the dam site. Koyna river is a major tributary to Krishna.

Unlike the other rivers rising in the Deccan Plateau, which flow in an eastern or south - western direction and therefore attracts high rainfall only at their source, the Koyna, flowing alongside the mountains and parallel to the Arabian Sea for more than half its course, catches in its deep boat like basin, a rainfall of well over 5080mm. (200") a year for a length of over 60 Kms. It is this water that is being impounded by the Koyna Dam from the catchment area of about 891.78 Sq. Km. (344.32 Sq. Miles).

Maharashtra being gifted by Sahyadri ranges with unique features of suddenly tapering down to sea level from peak within about 50 kms on western side. For the early stages of developments, it was necessary to firm up the requirement for base load needs. 

That the Koyna River has hydro-electric potential was first noticed and recorded in the general survey of hydro-electric possibilities in India by Mr. Meyers in the first decade of 20th century. After the first World War, a hydel project on the Koyna was investigated by the Tatas and it was the fourth on their priority for construction, preceded by (1) Khopoli (2) Bhivpuri (3) Bhira. The financial crisis that followed in 1928 caused the project to be shelved. After independence, the Tatas were generous enough to place at the disposal of the Government of Bombay, all the survey data & the scheme prepared by them. From this base, the Electric Grid Department of Bombay took off the further work by about 1950. A scheme contemplating to utilize all available run-off of the Koyna River for hydro-electric purpose was prepared but was not taken up for execution because it was too large for load forecasts of that time.

Early in 1951, a limit was imposed by the Planning Commission on the Westward diversion of the Koyna water for power generation. At about the same time, a committee of experts who visited India to attend the International Congress on Large Dams expressed an opinion in favor of adopting an underground power station at Koyna. As a result a two-stage construction was conceived of, with a time lag of about not less than 10 years between the two stages.
After a close and incisive scrutiny of a possible alternative to feed Bombay with power , the Koyna first stage project was approved late in 1953 and was taken up for construction early in 1954 with an appropriate ceremony at the hands of the then Chief Minister of Bombay, Shri. Morarji Desai.Within two years thereafter, it came to be noticed that the 10 years time tag between these two stages will be very much less and the trend was that quite possible, the two stages will merge into one continuous constructional operation, by 1958-59. Subsequently, it was accepted that the stage construction has lost its individuality and that the two stages have to be executed as one.
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