HIDCL to invest Rs 36 billion in five years
Kathmandu, September 16
The government-owned Hydroelectricity Investment and Development Company Ltd (HIDCL) has unveiled its plan to invest Rs 36 billion in hydropower sector within the next five years.
The company’s business plan, approved by its board of directors meeting led by energy secretary, has allowed HIDCL to invest the aforementioned amount in projects initiated by independent power producers (IPPs), according to Chhabi Raj Pokharel, chief executive officer of HIDCL.
“We have already finalised to invest in various projects with total installed capacity of 238 megawatts and some are under discussion,” said Pokharel. The company has concluded negotiations with some projects being developed by IPPs to invest Rs 5.09 billion and these projects are going to be developed in the next five years.
Similarly, HIDCL, which is authorised to develop its own projects and also to finance other hydropower projects, is planning to invest Rs 16.21 billion in generation projects that are going to be developed by government-owned companies and also by Nepal Electricity Authority (NEA) and its subsidiary companies, as per Pokharel.
According to Pokharel, HIDCL will finance projects being developed by IPPs with capacity to generate 565 megawatts and projects with total capacity of 640 megawatts being developed by government-owned companies, including NEA, in the next five years.
HIDCL has said that it has given priority to consortium financing in projects instead of making sole investment. “Commercial banks in the country have the capacity to chip in around Rs 80 billion to Rs 90 billion in the hydropower sector,” said Pokharel, adding, “We are also looking for line of credit from development partners to invest in the hydro sector.”
HIDCL has been negotiating with the Asian Development Bank (ADB) to mobilise $50 million under line of credit (LoC). “We are close to finalising the negotiations to invest ADB’s LoC in four projects,” said Pokharel. “ADB may provide LoC facility to us through Ministry of Finance.”
Such credit that is issued under sovereign guarantee comes with up to two per cent interest. “The MoF will disburse the LoC provided by ADB to HIDCL, thus, we can mobilise the fund at a relatively cheaper interest rate,” Pokharel added.
HIDCL is also planning to mobilise resources from the Employees Provident Fund, Citizen Investment Trust, Rastriya Beema Sansthan and the Welfare Fund of Nepal Army, among others.
HIDCL’s paid-up capital stands at Rs 10 billion and it has made share investment worth Rs 255 million in its subsidiary company, Remit Hydro Ltd, Rs 42 million in Power Transmission Company Nepal and is also preparing to chip in 15 per cent (of the paid-up capital) each in Power Trading Company and Nepal Engineering Company, according to Pokharel.
HIDCL’s subsidiary Remit Hydro has initiated two projects in Taplejung district of eastern Nepal — Ghunsa (71.5 MW) and Shikhuwa (53.7 MW). Likewise, HIDCL has made investments worth Rs 4.63 billion in 42-MW Misri Khola; 27-MW Dordi; 23.5-MW Solu; 82-MW Lower Solu; 20-MW Bagmati; 25-MW Kabeli B I; 21.6-MW Lower Hewa; 30-MW Nyandi; 50-MW Super Dordi; 51-MW Likhu-1. Similarly, it has mobilised $40 million from the World Bank Group for the 37.6-megawatt Kabeli ‘A’ project.