Generation licence to Lower Arun Hydroelectric

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    KATHMANDU, NOV 19 – The government finally issued a generation licence to Lower Arun Hydroelectric Company (LAHC) on Sunday—more than one and a half years after it applied for licence—to develop 400 MW Lower Arun Hydropower Project. The company, in Lower Arun HEPwhich Brazil’s Brasspower has substantial stake, had applied for generation licence on March 4, 2011.
    Energy Secretary Hari Ram Koirala said that the Ministry of Energy granted the generation licence to the LAHC for a period of 30 years after it found the documents submitted by the company feasible. “We came to the conclusion that the development of the Lower Arun project would help minimise the existing power crisis in the country substantially,” he said.
    Koirala said that the licence had been issued with certain conditions that the company should fulfill within 18 months. Besides an obligation to complete financial closure within 18 months, the ministry has also asked the LAHC to start the project construction process within 30 months. The run of the river (RoR) project is located in the Sankhusabha district.
    According to MoE sources, the company has already submitted its environmental impact assessment (EIA) report to the ministry, which in turn has forwarded it to the Ministry of Environment.
    “The Environment Ministry is yet to approve the report,” said a high level official, “We will ask the ministry to make a quick decision on it.”
    An LAHC official said that the company had already signed a memorandum of understanding with Power Trade India (PTI) to sell 50 percent of its generated energy to India. “We are yet to sign a power purchase agreement with PTI,” said the source, adding, “We will sign a PPA with both the PTI and the government once the matter over the supply of the rest of the energy in the country is settled.”
    However, the ministry has asked the LAHC to supply at least 50 percent of the project’s energy for domestic consumption.

    Source : The Kathmandu Post