Kathmandu, January 23:

With a view to provide financial support to the energy sector, Clean Energy Development Bank Ltd (CEDBL) has been established in Kathmandu.

Bijaya Nath Bhattarai, governor of Nepal Rastra Bank (NRB), formally inaugurated the bank at a function at Sitapaila Chowk, Kathmandu on Tuesday. Earlier, the bank began its operations as a financial institution from September 7.

Bhattarai said despite Nepal’s potential in hydropower, a strong need for investment has been felt in renewable energy sector, especially on infrastructure development.

He underlined the need for enhancing the capacity of financial institutions in order to compete after 2010, when Nepal will open its financial sector to foreign players. “The Merger and Acquisition law has already been enacted and it is a good time for weaker companies to go for a merger or acquisition,” Bhattarai said.

Manoj Goyal, chief executive officer of CEDBL, said the bank would give priority to project financing, including investment in hydropower, biomass, solar power and energy-efficient projects.

“CEDBL has already signed an agreement to assist in 10 projects of energy development,” informed Goyal.

Established with an authorised capital of Rs 640 million, CEDBL has a paid-up capital of Rs 320 million. The bank plans to promote small and mediumsized hydropower projects.

Winrock International and USAID have been providing technical assistance to the bank.