Mistrikhola pushed back by 1.5 years

    362

    ” Cost rises by Rs 550 m before start of construction “

    KATHMANDU, April 6

    misMistrikhola Hydropower Project (42 MW) being constructed by Robust Energy has been pushed back by one and half years due to the delay in construction of transmission line in the Kali Gandaki corridor by the Nepal Electricity Authority (NEA).

    Though the promoters and NEA had signed power purchase agreement (PPA) over three years ago to start generation by May, 2016, the project has now been pushed back to January, 2018 on request of NEA as the transmission line looks unlikely to be finished in time. The promoters have even prepared the new schedule for completion of the project. It has accused NEA of not being serious in construction of transmission line even when the country is reeling with daily power cuts of 12 hours. Managing Director of Robust Subrat Dhital claimed that the project cost has increased by Rs 550 million even before start of construction due to the delay. He explained that the estimated cost has already increased by Rs 550 million due to the rise in price of cement, steel rods, and electromechanical and hydromechanical equipment due to appreciation of US dollar, and rise in wages of workers. The increased amount is sufficient to build a 3 MW project.

    “Cost has increased even before start of construction and tens of millions of income to be received from selling electricity will also be lost due to the delay. We are suffering due to NEA,” he stated. He claimed that the company had started works to complete it by the scheduled period of May, 2016. “We have prepared bid documents for construction after completing all works including financial arrangements, environmental impact assessment (EIA) and procurement of land,” he added. He opined that the project will again be affected if NEA were to fail to construct transmission line in the scheduled time. “NEA has to pay compensation of just eight percent to Robust for delay by a year as per the take or pay provision. We will receive only Rs 100 million a year in that fashion even though the annual interest on loans taken by the company from banks and financial institutions is around Rs 500 million,” he insisted.

    NEA has to construct 115 kilometers of 220 KV transmission line from Dana of Myagdi to Butwal in the Kali Gandaki corridor. But NEA has not been able to construct that in lack of funds. Robust has to construct just four kilometers of transmission line to connect the generated electricity to Dana Sub-station. The project will be constructed in Narchyang village development committee (VDC) of Myagdi. The Energy Ministry has provided license in 2012 to generate electricity for 35 years. The estimated project cost is Rs 5.65 billion, out of which 70 percent will be loan investment and the rest 30 percent through shares. The promoters have already made equity investment of Rs 1.41 billion in the project. Himalayan Bank, Hydropower Investment and Development Company Limited (HIDCL), Nepal Investment Bank, Nepal Bank, Laxmi Bank, Siddhartha Bank and Ace Development Bank under leadership of Nabil Bank have agreed to make loan investment of Rs 4.24 billion.

    The PPA has been signed at Rs 4.66 per unit considering the fiscal year 2067/68 as the base year. NEA has agreed to raise the rate for up to 15 occaions at the rate of three percent every fiscal year. The rate will rise to Rs 5.40 per unit from the date of commercial generation according to PPA. Chairman of IME Group Chandi Prasad Dhakal, and entrepreneurs like Pradeep Jung Pandey, Suhrid Ghimire, Ram Kaji Kone, Shyam Sundar Khetan and others have invested in the project.

    Source : Karobar Daily