Consortiums sign agreements to fund US$111.4 million for two small hydropower projects in far-western Nepal

Bajhang district, Seti zone, Nepal

The Nepal Department of Electricity Development, in conjunction with the government’s Western Uplands Poverty Alleviation Project (WUPAP), issued licenses for the development of two small hydroelectric projects located in the Bajhang district in October 2014. According to reports published Sept. 7, two consortiums have signed agreements to fund construction of each plant, the total cost of which is about US$111.4 million.

WUPAP is a three-phase US$32.565 billion project designed to create a better economic situation for mid- and far-western regions districts of Nepal.

Bajhang district is part of the northwest portion the Seti zone, located in the far-western region of Nepal. The zone’s northern point boarders China and its southern boundary boarders India.

In January 2003, the International Fund for Agricultural Development (IFAD) and the government of Nepal launched WUPAP to help the region’s population alleviate poverty and provide access to electricity. WUPAP was originally scheduled to last 11 years, but four additional years have since been added to the program.

Phase I and II are complete and currently the $14.82 million phase III -- from July 2012 through July 2018 -- is being implemented.

The Seti zone (upper left in pink) is in far-western Nepal. (Graphic/Courtesy of Wiki Commons)

The first of the two projects is the Rs 2.80 billion (US$42.1 million) 15.33-MW Kalanga hydropower project located on the Kalanga River in Sukunda, Bajh and Khairatadi village development committees (VDC’s) -- municipalities -- of Bajhang district.

The project developer is Kalanga Hydro P Ltd. and it is being financed by a consortium that includes: NMB Bank, NIC Asia Bank, Civil Bank, Janata Bank Nepal, Deva Bikas Bank and Jyoti Bikas Bank.

Kathamandu-based Sanigad Hydro Pvt. Ltd is developing the second facility, the 38.4-MW Upper Kalanga hydroelectric project, also located on the Kalanga River, in Bajhang district. The planned-facility will be a run-of-river project that has a gross head of 585.50 m, design discharge of 8 m3/s and an expected annual energy generation of 219.3 GWh.

A consortium that includes: Machhapuchre Bank, Rastriya Banijya Bank, Nepal Bank, NCC Bank, Sunrise Bank, Kumari Bank, Janata Bank and Civil Bank will jointly invest Rs 4.74 billion (US$71.3 million) to construct the project.

Information on the completion date for each project is not immediately available.

Chairman for both of the Bajhang-based projects, Umesh Shrestha, said, “Hydropower is the main medium through which Nepal can achieve economic prosperity. So, the government should develop infrastructure and encourage the private sector to invest in this sector.”

Agencies contributing to WUPAP include: The IFAD, the government of Nepal, local service providers, VDCs and the private sector.

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