Negligence in Tanahu project


    ” Project set to be delayed, cost to rise “

    KATHMANDU, July 3

    Tanahun-SetiContinuous negligence in appointment of consultant is set to once again push back 140-MW Tanahu reservoir-based hydropower project. The project has been stalled for the past one year due to the politics in selecting the consultant owing to insistence of donors and promoters despite arrangements of investment.

    Cost of the project will rise by almost 10 percent if it is delayed by a year while promoter Tanahu Hydropower also will lose billions in tariff of 857.70 million units of electricity to be generated by the project every year. The estimated cost of the project is around Rs 45 billion (US$ 500 million). Donor Asian Development Bank (ADB) had invited bids for consultant for the second time last July. Electricite de France SA (EDF), MWH International Inc America, Mott MacDonald Limited UK, Tractwell Engineering (France), Lahmeyer International (Germany) and Kansai Electric Power Inc (Japan) had submitted bids. ADB had selected Lahmeyer and written to Tanahu to move dialogue with the German company forward. But the dialogue has not moved forward until now.

    ADB has lent US$ 27.50 million (around Rs 2.75 billion) for consultant. There will be 40 percent of share investment and 60 percent of loan in the project. J Power of Japan has already prepared Detailed Project Report (DPR) of the project and submitted it to the Nepal Electricity Authority (NEA).

    Though the recently revealed policies and programs of the government mentioned that civil construction will start from the upcoming fiscal year, that does not look possible due to procedural delay. Tanahu Hydropower Limited earlier had aimed to complete contract agreement by January 21, 2014, send the consultant to work in February and start work by March, as per the amended working schedule. NEA is developing the project through Tanahu Hydropower Limited. The project was earlier scheduled to be completed by 2018 and was later rescheduled for 2020. Though ADB had caused delay in selection of consultant earlier, promoter Tanahu is delaying it now. The project has already been delayed by two years due to appointment process for project management consultant (PMC).

    Director of Tanahu Sunil Kumar Dhungel concedes there has been delay in appointment of consultant and claimed that appointment will be made in a few days. The project work will move forward only after appointment of consultant. The consultant will have to supervise the project for 12 years including one year for preparation of bid documents, six years for construction and five years for operation. The project being constructed for domestic consumption is expected to meet the demands during evening peak hours.

    The promoter plans to complete the project around 48-60 months after start of construction. ADB earlier had cancelled the process after the government refused to provide guarantee for PMC. ADB had tried hard to appoint Kansai as PMC and had again invited bids after failing to do so. Japan International Cooperation Agency (JICA), European Investment Bank and Abu Dhabi Development Trust will also invest in the project while Nepal government will invest the remaining amount. Arrangements for the required investment have already been made.

    The project is set to complete electrification of 17,000 households in 17 remote village development committees (VDC) of Tanahu district deprived of electricity. The electricity generated from the project will be connected to the Bharatpur sub-station from its powerhouse at Damauli through a 40-km 220 KV transmission line

    Source : Karobar Daily