Myagdi: Nearly a decade and a half after construction began, the long-awaited 40 MW Rahughat Hydropower Project in Myagdi has entered the test production phase. Delays caused by contractor-related issues, contract cancellations, project restructuring, the selection of new contractors, the COVID-19 pandemic, floods and landslides, and shortages of river-based construction materials had stalled the project for years. It has now reached the final stage before commercial electricity generation.
Both generating units of the project, promoted by Raghuganga Hydropower Limited, a subsidiary of the Nepal Electricity Authority (NEA), have successfully completed testing. According to Managing Director Ganesh KC, the two 20 MW units have been operated at full capacity and connected to the national grid.
“We have operated both units at full capacity and synchronized them with the national transmission system,” KC said. “As per our agreement with the NEA, commercial generation will begin after 15 days of successful test production.”
The project is expected to generate 240.593 million units of electricity annually. It signed a Power Purchase Agreement (PPA) with the NEA in April 2019.
The project dam has been constructed at Dagnam and Jhiin in wards 4 and 5 of Raghuganga Rural Municipality. A 6.27-kilometer headrace tunnel and two settling ponds have been built between the dam and powerhouse. The powerhouse is located at Tilkenichaur in Ward 3 of Raghuganga Rural Municipality, alongside the Beni–Jomsom road section of the Kali Gandaki Corridor.
An 11-kilometer access road has been constructed from Tilkenichaur to the dam site via Ghumaaunetal, Piple, Mauwaphant, and Bugla. Project Chief Raj Bahadur Bista said a Bailey bridge has also been built across the Rahughat River.
In addition, a switchyard has been constructed at the powerhouse site, along with the infrastructure required to connect the project to the 220 kV double-circuit Dana–Kushma transmission line under the Kali Gandaki Corridor.
A Journey That Began With IVRCL
The construction journey of the Rahughat project was far from smooth. On November 4, 2010, the NEA signed a civil works contract worth NPR 2.5 billion with Indian construction company IVRCL. Under the original schedule, the project was expected to begin generating electricity by 2013.
However, IVRCL failed to make satisfactory progress due to its weak financial condition. The NEA terminated the contract in 2015. At the time of cancellation, physical progress had reached only 12 percent despite five years having passed.
Following the termination, the NEA restructured the project. Originally designed as a 32 MW facility, its capacity was upgraded to 40 MW, and it was decided that the project would be developed under a company model. Although legal disputes related to the contract cancellation caused further delays, the restructuring became a key turning point in the project’s development.
New Beginning Under a Company Model
After terminating IVRCL’s contract, the NEA established Raghuganga Hydropower Limited in 2016 as its subsidiary to take forward the project. Construction proceeded under an Engineering, Procurement and Construction (EPC) model, financed through a USD 67 million concessional loan from the Export-Import Bank of India (Exim Bank), along with investments from the Government of Nepal and the NEA.
A new civil works contract worth nearly NPR 6 billion was awarded to Indian company Jaypee Associates (JP) on November 22, 2017, with a target of completing the project within 45 months.
JP began access road construction in July 2018 and started excavating the main tunnel from the third adit at Piple on June 22, 2019. After years of work, the breakthrough of the main tunnel was achieved on July 30, 2024.
According to MS Gaur, Manager of civil contractor Jaypee Associates, the project faced delays due to the COVID-19 pandemic, floods, landslides, and shortages of construction materials sourced from riverbeds.
For the electromechanical works, a contract worth USD 10.293 million was signed in November 2019 with Bharat Heavy Electricals Limited (BHEL), a company owned by the Government of India.
‘Gateway to Hydropower Development in Myagdi’
Subin Shrestha, President of the Myagdi Chamber of Commerce and Industry, described Rahughat as the gateway to hydropower development in the district. It is the first major hydropower project in Myagdi to be developed with government investment.
“Since the Rahughat project was launched, ten other hydropower projects that entered Myagdi have already been completed,” he said. “Although delayed, we are encouraged to see Rahughat finally reach the electricity generation stage after nearly 15 years of waiting.”
Originally planned as a 32 MW project, Rahughat has now reached the test production stage with an installed capacity of 40 MW. After overcoming years of construction challenges, contractual disputes, and other obstacles, the project is now set to move into commercial operation following a 15-day test generation period.
Jalasarokar