KATHMANDU, JULY 9

The Nepal Electricity Authority (NEA) has commenced the construction of Budhigandaki Hydroelectric Project, a national pride project aiming for a capacity of 1,200 megawatts.

As per the instruction of Prime Minister Pushpa Kamal Dahal 'Prachanda', a team led by NEA Managing Director Kulman Ghising conducted a comprehensive site inspection of proposed construction site and the reservoir area of the project on Saturday.

The team conducted inspections of various locations, including the proposed dam construction site on the border of Gorkha's Gandaki Municipality and Siddhalek Rural Municipality, the powerhouse construction site in Siddhalek Municipality's Salang, the affected surrounding areas of the proposed reservoir.

The team also collected information regarding the acquisition of land required for the project, the progress made in terms of resettlement and rehabilitation, and the distribution of compensation.

The government has decided to implement the project under a company model.The Budhigandaki Hydroelectric Company has been established for the construction of the project.

NEA MD Ghising mentioned that discussions are underway under the leadership and supervision of the authority regarding the restructuring of the company's share structure for the construction of the project.

'Budhigandaki holds significant strategic importance owing to its close proximity to major electricity load centres like Kathmandu, Chitwan, and Pokhara. To ensure utilisation of domestic capital, the authority intends to acquire a majority share in the company. Additionally, shares will be issued to the general public, enabling broader participation.

The government plans to invest sufficient funds and provide concessional loans to support the project's financial management,' stated Ghising.

'If the government can arrange to deposit half of infrastructure tax levied on the import of petroleum fuel directly into the account of project, there won't be problem for investment.'

Based on a report prepared by consultants in 2015, the project was initially estimated to cost $2.59 billion.

However, the latest reassessment of the project suggests that the estimated cost has now increased to approximately $2.77 billion.The projected construction period for the project is expected to span eight years.

The land acquisition process for the project has reached around 90 per cent.

Compensation amounting to around Rs 42 billion has been estimated and distributed to affected households for land acquisition, structures, relocation, and crop damages. Approximately 8,117 households in Gorkha and Dhading districts are anticipated to experience both physical and economic impacts due to the project.Among them, around 3,560 households will face complete displacement.

An arch dam with a height of 263 metres will be built across the Budhigandaki River, flowing along the border of Gorkha and Dhading districts. Once the dam construction is completed, it will create a reservoir spreading over an area of 63 square kilometres in the adjoining coastal region.

The project will feature a maximum water level reaching up to 540 metres. It is estimated that the project will have an annual electricity generation capacity of 3.38 billion units.

A version of this article appears in the print on July 10, 2023, of The Himalayan Times.