The Ministry of Energy (MoE) is moving ahead with its plan to upgrade the Upper Trishuli 3A hydropower project despite objections by the Ministry of Finance (MoF). The MoE wants to increase its capacity from the originally planned 60 MW to 90 MW.
On Thursday, energy secretary Hari Ram Koirala asked the Nepal Electricity Authority (NEA) to prepare a report on the matter. Koirala, who also chairs the NEA board, has formed an internal committee to do a study. The MoE has asked the MoF to agree in principle to its proposal and arrange funds by borrowing from China Exim Bank. However, the MoF has barred the MoE from moving ahead with the plan.
Koirala said that there was nothing wrong with increasing the capacity of the project. “Once the committee submits its report, the board will reach a final decision on boosting the capacity of the Upper Trishuli project,” said Koirala. He added that the MoF had not rejected the MoE’s idea to upgrade the project’s capacity. “As it is the MoE’s internal concept to enhance the capacity, the MoF has no right to approve or reject it.”
NEA officials confirmed that the ministry had asked them to prepare a report so as to reach a final decision. They also said that the NEA had been facing pressure from agents, contractors, politicians and the ministry. Raising the capacity of the project will add Rs 3 billion to its estimated price tag of Rs 10 billion.
Construction of the project began six months ago with a loan assistance from China Exim Bank. An MoE source said that the ministry’s plan to increase the capacity was guided by the interest of the contractor rather than by real need and potential benefits to the country. He also termed the move “illegal and useless” as it violated the Public Procurement Act. A Chinese contractor, China Gezhouba Group Co, is executing the project.