Kathmandu: Stakeholders have expressed serious concern over the growing risk of natural disasters in the Himalayan and hilly regions due to climate change and their severe impact on the energy sector, which is considered a backbone of the national economy.
They made the remarks at IPPAN’s Friday Forum for August, organized by the Independent Power Producers’ Association, Nepal (IPPAN), on the theme “Building Climate-Resilient Infrastructure in a Changing Climate and Lessons Learned from the Bhotekoshi Disaster.”
Speakers at the event emphasized that the government, Nepal Electricity Authority (NEA), private sector and insurance companies must work together to rebuild and restore hydropower projects damaged by the floods in the Bhotekoshi and Trishuli basins. They said it was essential to adopt modern technologies for disaster risk reduction, facilitate the necessary policies and regulations, and develop a roadmap for rapid financial recovery.
They also stressed the need for all stakeholders to work together to effectively implement early warning systems and develop climate-resilient infrastructure to minimize potential damage from future disasters.
Former Energy Minister and former Managing director of the Nepal Electricity Authority Kulman Ghising, who was the keynote speaker at the event, urged the government to immediately declare the Bhotekoshi-Trishuli corridor a “special area” to facilitate the recovery of local communities and the energy sector affected by the disaster.
Ghising said the government and concerned agencies should adopt concrete policies and declare the Bhotekoshi and Trishuli hydropower cascade a “special area” to revive the projects in the corridor. According to Ghising, the unprecedented debris-laden flood and landslide that struck the Bhotekoshi and Trishuli river corridors on Bhadau 10 pushed the entire Rasuwa district’s economic, social and physical infrastructure back by 20 to 30 years.
“Visiting the villages of Rasuwa now, one can see heartbreaking scenes. With young people, drivers and technical workers swept away by the flood, only children and elderly people remain in the villages,” he said, describing the situation after the disaster.
He stressed that the government must take immediate steps to help the energy sector and local communities recover from the crisis. Ghising suggested that the government immediately declare the Rasuwa-Trishuli corridor a “special area” and expedite relief, compensation and reconstruction of damaged infrastructure.
Ghising, who has been involved in field inspections and rescue operations in the Bhotekoshi and Trishuli corridors since the first day of the disaster, said the government should provide customs exemptions, a special financial recovery package, extensions of generation licences and the required commercial operation date (RCOD), as well as legal provisions for capacity expansion for affected hydropower projects by declaring the corridor a “special area.”
He also called for the access road from Betrawati to Rasuwagadhi to be upgraded to at least a two-lane road or larger and constructed at a war footing up to the Chinese border. This, he said, would facilitate reconstruction of the projects and commercial transportation.
Emphasizing modernization of technology and design, Ghising said powerhouses to be built in the future should adopt remote-operation technologies similar to those used in developed countries such as Austria and Switzerland. He also suggested making main access tunnels safer and ensuring mandatory emergency exits.
He said suspended power purchase agreements (PPAs) should be reopened immediately in the interest of national energy security. He also stressed that it had become essential to build at least one reservoir-type project in every river basin to reduce the impact of flash floods and balance electricity supply between the dry and wet seasons.
Ghising further said electricity tariffs and tax policies, including VAT and customs duties, should be made more energy-development friendly to protect the financial health of the NEA, which he described as the backbone of the energy sector.
At the event, IPPAN President Mohan Kumar Dangi said the debris-laden mud flood and landslide on August 26, 2026, caused extensive damage to hydropower projects—both operational and under construction—in Rasuwa, Nuwakot and other areas, as well as roads, settlements and a large number of people.
According to preliminary data collected by IPPAN, a total of 12 hydropower projects and one solar power project in the Rasuwa-Trishuli corridor were directly affected by the August 26 disaster. Of these, eight operational hydropower projects with a combined capacity of 281 MW have been completely disconnected from the national transmission grid, while construction of four projects with a combined capacity of 388 MW has come to a halt.
Thus, projects with a combined capacity of 669 MW have suffered damage, delivering a major blow to the national electricity system and investment in the energy sector.
Dangi said the disaster had raised a dilemma in society over whether hydropower projects should continue to be built. He stressed the need to dispel such doubts through scientific and technical studies.
He said the private sector remained committed to achieving the government’s national target of generating 30,000 MW of electricity over the next 10 years, and urged the government to play a supportive role in resolving the problems faced by project developers.
Mad an Raj Timilsina, deputy Managing director of the NEA, who was heading the authority’s Generation Directorate when the disaster occurred, shared his first-hand experience of the August 26 catastrophe and described the devastating situation.
He said that after receiving information at 9:10 a.m. that a massive flood had occurred upstream, employees working at the underground powerhouse of the 60 MW Upper Trishuli 3A Hydropower Project were immediately instructed to move to a safe location, but many lives were still lost.
“Immediately after receiving the information, instructions were issued to move to safety and open the dam gates. But within five minutes of receiving the information, at 9:15 a.m., the flood had already entered the powerhouse through the tailrace and main access tunnel,” he said.
“Of the 40 skilled NEA personnel who went missing from the project site, only two were rescued alive.” He said two bodies were recovered on the 10th day and the remaining employees were still missing.
He also said the flood had raised the river level by as much as 30 metres, creating major technical uncertainties over the reconstruction and operation of the powerhouse.
Similarly, former IPPAN President and promoter of Langtang Khola Hydropower Project Krishna Prasad Acharya shared his experience of the 26-year struggle, legal hurdles and financial challenges involved in bringing the project to the construction stage and preparing it for operation, only for the unprecedented flood to completely destroy the project.
He said the disaster struck suddenly despite clear weather and killed or left missing 39 of the 60 people working at the project.
He stressed that the state must provide clear policy protection to investors, saying that private-sector investment accounts for more than 80 percent of Nepal’s energy sector investment, while administrative delays and disasters are discouraging investors.
Dr Basanta Raj Adhikari, director of the Biotechnology Study Centre at Tribhuvan University and a hydrometeorologist, presented a technical paper on “Climate Change and Lessons Learned from the Bhotekoshi Disaster.”
Presenting the paper based on scientific simulation technology and geological data, Adhikari said the flood was not caused by normal seasonal rainfall but was an unprecedented disaster involving a glacial lake outburst or a sudden massive debris flow triggered by climate change in the high Himalayas.
According to Adhikari, such catastrophic disasters, which historically occurred once every 5,000 to 10,000 years, have started recurring more frequently due to climate change.
He recommended changes to the design criteria of hydropower projects, stronger structural protection for tunnels and intakes, safer locations for powerhouses in elevated Himalayan areas or upstream locations, and the installation of advanced flood early-warning systems along river corridors.
During the discussion session, Birendra Baidawar Chhetri, president of the Nepal Insurers’ Association and CEO of Siddhartha Premier Insurance, presented the insurance sector’s position on insurance claim settlements, financial recovery and legal complications raised by hydropower developers.
Chhetri said arrangements would be made, in coordination with the Nepal Insurance Authority, to settle small claims worth up to Rs 5 million to Rs 10 million, claims related to damaged vehicles, personal accident insurance and home insurance through an expedited claim-settlement procedure within one month.
In the case of employees and citizens missing in the flood, he said a legal mechanism was needed to reduce the existing seven-to-10-year waiting period and allow accident insurance claims to be paid through a simplified process.
He said the estimated damage to the hydropower sector from the disaster in the Bhotekoshi and Trishuli corridors had reached Rs 15 billion to Rs 23 billion or more—two to four times higher than the total annual claims generally borne by Nepal’s non-life insurance companies.
As most hydropower projects in Nepal are located along snow-fed rivers, international reinsurers have begun viewing Nepal as a high-risk area. Chhetri warned that insurance coverage could become more difficult to obtain and premiums could rise in the future, making joint risk-reduction measures by the government and private sector necessary.
IPPAN has also taken the lead in relief and rescue efforts as part of its institutional responsibility during the crisis.
According to IPPAN President Mohan Kumar Dangi, the organization collected Rs 130.1 million in relief funds from 48 companies under 58 business groups without seeking any contribution from the affected projects. The amount has already been handed over to the Prime Minister’s Disaster Relief Fund through the Minister for Energy, Water Resources and Irrigation.
Representatives of the 58 energy companies that contributed to the relief fund were honored with shawls and certificates of appreciation. Former Energy Minister Kulman Ghising and IPPAN President Dangi jointly presented the certificates.
The broader event, moderated by IPPAN Secretary and Friday Forum coordinator Kuber Mani Nepal, was attended by a large number of senior figures from the energy sector.
Former secretaries Dinesh Kumar Ghimire and Anup Kumar Upadhyaya, former IPPAN President Ganesh Karki, Electricity Development Department Director Mandevi Shrestha, Joint Secretary at the Ministry of Energy Jiwachh Mandal, NEA Deputy Executive Directors Kiran Kumar Shrestha and Madan Timilsina, and senior representatives from the Electricity Regulatory Commission and Department of Hydrology and Meteorology also participated.
The event was also attended by Nepal Tunnelling Association President Ramhari Sharma, chief executive officers of the National Grid Company Nepal and Nepal Electricity Generation Company, members of the NEA board of directors, IPPAN Senior Vice President Uttam Kumar Bhlon, vice presidents and executive committee members, representatives of banks and financial institutions, hydropower project promoters and a large number of energy journalists.
IPPAN has been organizing the Friday Forum on contemporary issues in the energy sector on the last Friday of every month.
Urjasanchar
