Koyna river is a major tributary to Krishna. Koyna river originates near Mahabaleshwar township, which is a famous hill station in Sahyadri Range. Unlike other rivers which flow either eastward or westward immediately after origin, Koyna river flows in a north - south direction almost parallel to the continental divide for a distance of 65 Kms. from Mahabaleshwar to village Helwak, skirting King Shivaji's fort Pratapgadh. At village Helwak, it turns sharply eastwards, travels for about 56 Kms and joins River Krishna at Karad. It’s a peculiar confluence where both the rivers meet head on. This confluence is aptly named as Preeti Sangam.

The catchment of the River Course up till Helwak, has an average rainfall of above 5000 mm. Up to Koyna Dam, the catchment area is 891.78 Sq. Km. (344.32 Sq. Miles). The average annual yield with 75% dependability is 120 TMC

Maharashtra is gifted by Sahyadri ranges. Average height of the range is around 750 m, which suddenly drops by 600 m to a level of 150 m in just 100/200 meters and then tapers down to sea level in further 50 Kms on western side.

The hydro electric potential of Koyna Valley 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 data, the Electric Grid Department of Bombay took over the further work by about 1950. A scheme contemplating utilization of all available run-off of the Koyna River for hydro-electric purpose was prepared. The power potential 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 stage wise construction was conceived of in 2 stages, with a time lag of about 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 in 1954 with an appropriate ceremony at the hands of the then Chief Minister of Bombay, Shri. Morarji Desai. Within two years thereafter, it was realized that power demand of Mumbai is increasing very fast and that the 10 years time lag between these two stages will be very large and as the need of the time, the two stages will have to be merged into one continuous constructional operation, by 1958-59. Subsequently, it was accepted that the stage wise construction has lost its individuality and that the two stages have to be executed as one.
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