Nepal | May 29, 2020

MoE to use local financial resources to build hydro projects

Himalayan News Service
Share Now:

Kathmandu, June 7

The Ministry of Energy (MoE) will soon start building hydroelectric projects of up to 25 megawatts throughout the country by setting up independent companies in which the government, local residents, community organisations and cooperatives will be equity partners.

The MoE is taking this initiative in line with its programme titled ‘Electricity to People through People’s Investment’.

“We received approval from the Ministry of Finance to set up the first model company yesterday. We will soon finalise a project and roll it out,” MoE Deputy Spokesperson Gokarna Raj Pantha told The Himalayan Times.

The concept of roping in local residents and bodies to develop hydroelectric projects was introduced to make productive use of financial resources available at the local level.

“This will ultimately help in electrification process, generate jobs at the local level, raise people’s income and uplift living standard of local people,” Pantha said. “This concept will also instil a sense of ownership among locals in projects being built in their locality.”

To kickstart the programme, the MoE is mulling over building 13.5MW Maiwa Khola Hydroelectric Project in Taplejung. The Department of Electricity Development (DoED) has already conducted feasibility study of the project.

Although the Energy Ministry was also planning to build 12.25MW Madi Khola Hydroelectric Project in Rolpa at the time when the concept was first floated, it is now being said Nepal Army has shown interest to develop this project.

The MoE is also eyeing to build 15MW Chepe, 25MW Sankhuwakhola and 5MW Dotigad projects under this model. Also, projects of one to 25 MW that the private sector has failed to build for a long time are likely to be rolled out under this model.

The MoE has proposed formation of a six-member committee under the DoED director general to identify projects, conduct their feasibility studies, monitor implementation and coordinate with concerned authorities and bodies to facilitate implementation.

As per the plan, independent companies will be established to build each of the hydroelectric projects. These projects will be built with debt-equity ratio of 70:30.

This means 70 per cent of the fund required to build the project will be in the form of loans. This credit will be mobilised equally through financial institutions and the government.

The remaining 30 per cent of the fund required to build the project will be obtained from investors, which includes different ministries, the DoED, Nepal Electricity Authority (NEA), Hydroelectricity Investment and Development Company, district development committees, municipalities, village development committees, local cooperatives, district chapters of private sector umbrella bodies, community and consumer rights organisations, and local residents.

“As the company repays its debt, equity portion of shareholders will increase proportionately,” Pantha said, adding, “The government intends to control over 50 per cent stake in each of the projects.”

To ensure there is no problem in evacuation of electricity generated by these projects, the MoE will instruct NEA to extend transmission lines to sites where hydroelectric plants are located. Also, access ways will be built by concerned Road Division Office or District Technical Office, the MoE said.

 

 


A version of this article appears in print on May 08, 2016 of The Himalayan Times.


Follow The Himalayan Times on Twitter and Facebook

Recommended Stories:

More from The Himalayan Times:

Are we doing enough for the mental health of healthcare workers?

The number of coronavirus patients has been increasing over the past few days in Nepal. In the current scenario, it seems like the numbers would further increase in the coming days. Given that healthcare workers and frontline staff are the first responders to manage the ongoing pandemic with limited Read More...

Cases registered against two lockdown violators in Udayapur

GAIGHAT: Police have registered cases against two youths who were arrested on Tuesday for violating lockdown in Udayapur district. The arrested have been identified as Surendra Gupta and Rakesh Sah, both in their 30s. Lalpatta-based police post arrested the duo after they were found bringing t Read More...

Police recover two muzzle-loader guns in Kohalpur

NEPALGUNJ: Armed Police Force personnel recovered two abandoned muzzle-loader guns in Kohalpur Municipality-8 in Banke district, today. Deputy Superintendent of Police (DSP) Shyam Kumar Karki said that they recovered the weapons along with ammunition, shrapnel shells, and other items under Sikta Read More...

Rautahat locals clash with police in quarantine dispute; police open dozen blank fires

RAUTAHAT: Tensions ran high at Katahariya Municipality in Rautahat district after police opened a dozen rounds of blank fire to take situation under control as the locals protested against setting up a quarantine in the area and clashed with security forces, on Thursday. At least six police perso Read More...

Nepal Electricity Authority

1300 MW electricity to be added to the national grid

KATHMANDU: The government is all set to add 1,300-MW electricity to the national power grid of the country within the next fiscal year. A goal has been set to complete all the ongoing hydropower projects and expedite the under-construction projects in the country. The government is planning to Read More...

Industries affected by COVID-19 to receive loans at 5% interest rate

KATHMANDU: Cottage and small industries affected by Covid-19 will be provided loans at five per cent interest rate by the government. Finance Minister Yubaraj Khatiwada at the unveiling of the budget for the fiscal year 2020/21 at the joint meeting of the federal parliament shared that a separate Read More...

300 local level units to have land banks

KATHMANDU: The government, in collaboration with the provoncial and local governments, is set to establish land banks in 300 local levels. A budget of Rs. 500 million has been allocated in the federal budget for fiscal year 2020-21 for share investment in the land banks. According to Finance M Read More...