1756 MW of electricity to be added in seven years

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    KATHMANDU, Feb 23

    energy-transmissionInstalled capacity of 1756 MW will be added in the country through 117 projects being constructed with government and private investment in the coming seven years if they were to be completed in time. The total installed capacity of Nepal will reach 2590 MW, excluding the thermal plants in Duhabi and Hetauda with combined installed capacity of 53 MW, which is higher than the projected demand of 2000 MW after seven years.

    There will be no load-shedding during the rainy season and only a few hours of power cuts during the winter if the projects were to be completed in scheduled time. The promoters of these 117 projects have signed power purchase agreement (PPA) with the Nepal Electricity Authority (NEA). The total installed capacity is currently 700 MW from 38 projects developed by the government and private sector. NEA has projected that 3 billion units of electricity will go in waste during the rainy season after seven years.

    All of these under-construction and to be constructed projects will be completed if the proposed transmission lines were constructed and there were no obstruction at the local level. NEA and subsidiary companies under the Energy Ministry will develop projects with installed capacity of 862 MW while the rest will be developed by the private sector. Another 136 MW will be generated from projects constructed by NEA including 60-MW Trishuli 3 A, 32-MW Rahughat, 30-MW Chameliya, and 14-MW Kulekhani III. The promoters of 83-MW Lower Solu, 50-MW Upper Marsyangdi A and 54-MW Likhu IV are bringing in foreign investment. Likhu IV, to be constructed to export electricity to India, has done a fall-back PPA with NEA for a limited time. Khimti (60 MW) and Bhotekoshi (45 MW) have already been constructed with foreign investment.

    Upper Tamakoshi (456 MW) will be completed by June, 2016, Rasuwagadi (111 MW) and Mid Bhotekoshi (102 MW) by June, 2017, and Sanjen (42 MW) to be completed by December, 2015 are the bigger projects to be completed within seven years. The promoters of five of the six projects given to the private sector for construction by the government through free competition have expressed commitment to complete construction by December, 2019. Mistrikhola (42 MW) is scheduled to be completed by May, 2016, 27-MW Dordikhola and 30-MW Khanikhola by April, 2016 and Lower Solu by July, 2018. Seven different small projects will be completed and 40 MW of electricity will be added to the national grid during the current fiscal year, according to NEA.

    The promoters have been complaining about problems in financial arrangements due to lack of construction of transmission line in time. President of the Independent Power Producers, Nepal (IPPAN)  Khadga Bahadur Bista states that there will be problems of transmission lines even if only 80 percent of the proposed projects were to be completed in time. “There is possibility of completion of 80 percent of the projects whose PPA has been done even if all cannot be completed. Many projects will be completed in time if the problem of transmission lines were to be resolved. Lack of transmission lines has become a big problem in electricity development,” he added.

    NEA Spokesperson Sher Singh Bhat claims that PPA has already been done in a way that can meet the demand during peak load period. Conceding that lack of transmission lines is the main problem he adds, “The banks do not invest on projects if the transmission lines are not completed in time and the projects are not constructed.” He also concurs that many projects will be completed in time if attention were paid to construct transmission lines in time. The promoters have to pay compensation at an annual rate of five percent to NEA if the projects are not completed in scheduled time as per the agreements. Similarly, NEA also has to pay compensation of five percent to the promoters if it fails to construct transmission lines in time.

    The government has issued generation license for 2150 MW to the promoters until now while 38 projects with combined installed capacity of 700 MW have already been completed.

    Lack of transmission lines main problem

    Though NEA is rapidly signing PPA with promoters in recent times, the projects are likely to be affected due to uncertainty about timely completion of transmission lines. Projects are likely to be delayed due to lack of construction of transmission lines in Koshi, Kabeli, Solu, Kaligandaki and other corridors. The government is preparing master plan for transmission lines targeting the additional projects to be completed in the coming days and the Electricite de France (EDF) has already won the contract for the master plan that will be constructed within one and half years of start of work as per  the agreement.

    Electricity generated during the monsoon is being wasted in lack of construction of big transmission lines. Even the identified projects do not look feasible while NEA has also not been able to sign PPA with private promoters in lack of construction of transmission lines. Electricity generated by the Sipringkhola Hydropower Project (10 MW) developed by Synergy Power has not been connected to the national grid due to lack of transmission line. Similarly, there is no certainty about whether the 22-MW Sanimamai Hydropower Project being constructed by Sanimamai Hydropower Limited will be connected to the national grid this year as the transmission lines in the Kabeli corridor do not look likely to be completed in time.

    Source : Baburam Khadka / Karobar Daily