Nepal | July 09, 2020

Govt seeks assistance to develop four hydels

Himalayan News Service
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Kathmandu, October 28

The government is looking for financing from the multilateral banks to take forward some energy projects. According to the International Economic Cooperation Coordination Division, the Ministry of Finance (MoF) has proposed a few generation projects to four multilateral banks.

The MoF has been looking for financing from World Bank to carry forward Upper Arun with capacity to generate 335 megawatts of power. The World Bank Group has been financing small scale hydro projects after it pulled out from the Arun III hydropower project some two-and-a-half decades back. The World Bank has financed the 36.6-megawatt Kabeli A hydropower project and International Finance Corporation of the World Bank Group has equity investment in some hydel projects developed by independent power producers.

The government has also been looking for World Bank’s support for the distribution and transmission system augmentation in the eastern part of the country.

Similarly, the Finance Ministry has approached the Asian Development Bank (ADB) for financing the 300-megawatt Dudhkoshi hydropower project. ADB has so far financed the Kaligandaki A hydroelectric project and the 140-megawatt Tanahu hydropower project, which is under construction. ADB has been supporting Nepal Electricity Authority for distribution system augmentation in the western region starting from Butwal.

Likewise, the government has sought financing for Tamakoshi V hydropower project from the Asian Infrastructure Investment Bank (AIIB). The project is designed to be developed as a tail end or cascade project of the under-construction Upper Tamakoshi hydropower project. The MoF had proposed to the AIIB for financing the 101-megawatt project as well as two other projects during the AIIB’s third annual meeting held in Mumbai a few months back.

The government has proposed to AIIB for financing 93-megawatt Sharada-Babai hydropower project located in Dang and Salyan districts. Meanwhile, another energy project the MoF is seeking assistance for from AIIB is the ‘Nepal Distribution System Upgrading and Extension Project’, which aims to make the distribution system of Nepal Electricity Authority more effective and efficient and it has already been endorsed by AIIB.

Similarly, financing from European Investment Bank has been sought for the 14-megawatt Upper Modi hydropower project.

As the lack of robust electricity supply and connectivity is the major constraint to accelerating economic growth, the government has been looking for financing from the multilateral development banks to address these two major constraints, according to the MoF.


A version of this article appears in print on October 29, 2018 of The Himalayan Times.


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