Nepal's 335-MW Upper Arun, 30-MW Ikhuwa Khola hydropower plants receive World Bank backing

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The Government of Nepal has received a US$20 million credit from the World Bank to help implement its Power Sector Reform and Sustainable Hydropower Development Project.

The plan is intended to help Nepal strengthen its energy capacity by helping the country "to plan and prepare hydropower generation and transmission line projects along international standards and best practice," the World Bank said.

The funding will be used to continue preparations for the 335-MW Upper Arun and 30-MW Ikhuwa Khola hydropower plants, which have previous been identified as priority public investments by Nepal's government.

"Reforms initiated under this project will underpin the agenda of transformational hydropower development that the World Bank Group intends to support in Nepal over the coming years," said Julia Bucknall, Practice Manager for Energy and Extractives. "This project will help identify and address key challenges that stand in the way of Nepal achieving its full potential in the power sector."

Meanwhile, other portions will be used to:

  • Support the preparation of transmission line projects to be identified by the Nepal's ongoing Transmission System Master Planning plan;
  • Finance studies and propose policy recommendations for power sector reforms;
  • Promote river basin planning and integrated water resource management;
  • Improve water resource management and regulations; and
  • Support capacity building for safeguard management and sustainable hydropower development.

"Hydropower development in Nepal involves many partners," said Takuya Kamata, World Bank Country Manager for Nepal. "This project benefits from the inputs of a wide range of knowledgeable stakeholders which we hope can help define a broadly-owned vision for hydropower development in Nepal."

The concessional credit will also receive a $2.5 million grant from the South Asia Water Initiative.

The World Bank has been active in helping Nepal cultivate its hydroelectric power sector, with the organization inviting expressions of interest in rehabilitating the 144-MW Kali Gandaki A plant earlier this month.

For more news from Asia, visit here.

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