Hydropower Development:

Experience of Nepal

The Country

Landlocked

Diverse Physical Characteristics

Physiography Plains, Siwalik, Middle Mountains, High

Mountains and High Himal

Administrative 75 Districts and 5 Development Regions

Two rainy seasons June to September (80% of the total rainfall) Other months (remaining 20% of the total rainfall)

Mean Annual Precipitation Ranges from 6000mm to 250mm

More than 6000 rivers and rivulets

Estimated annual runoff about 220 billion cubic meters

The Country Contd.

Status on Hydropower Development

Potential Hydropower Capacity: 83000 MW

Less than 1.5% (approx. 565MW) has been developed till 2004

Projected Demand for 25 years (2027) in High growth scenario : less than 7000 MW

Techno-economically Feasible to date: 43000 MW

Challenges for Development Implement Integrated Water Resources Management Principles

Develop Hydropower at an affordable price for different users

Create Conducive Environment for Private Investment

Provide Electricity to rural areas particularly in Hills

Create awareness for community participation to develop, operate and manage micro-hydro

Strengthen the National Capabilities and Develop expertise

Execute, review and refine bilateral/regional treaties concerning water resources

Objectives: To generate electricity at low cost by utilize the water resource available in the country.

Policy Initiatives

To extend reliable and qualitative electricity service throughout the Kingdom of Nepal at a reasonable price To tie-up electrification with the economic activities.

To render support to the development of rural economy by extending rural electrification.

To develop hydropower as an exportable commodity.

Hydropower Development Policy 2001

Policy: Priority to meet domestic demand.

Policy Initiatives

Encourage Build, Operate, Own and Transfer

Encourage micro-hydro at local level

Hydropower Development Policy 2001 contd.

Provision of incentives for National and Foreign Investment

Thrust for Storage type and multipurpose projects

Due consideration to environment impact

Policy: Control electricity leakages

Policy Initiatives

Provision for risk sharing

Hydropower Development Policy 2001 contd.

Restructure the existing institutions

Provide reliable and qualitative electricity at reasonable price

Transparent and rational tariff fixing mechanism

Encourage demand side management

Facilitation through one window policy

Policy Principles: Development and management of water resources shall be undertaken in a holistic and systematic manner, relying on

Integrated Water Resources Management;

Policy Initiatives

Water utilization shall be sustainable to ensure conservation of the resources and protection of the environment. Each river basin

system shall be managed holistically;

Water Resources Strategy 2002:

Delivery of water services shall be decentralized in a manner that involves autonomous and accountable agencies (e.g., public, private, community and user based agencies);

Economic efficiency and social equity shall guide water resources development and management;

Policy Principles: Participation and consultation with all the stakeholders shall constitute the basic water sector development;

Policy Initiatives

Sharing of water resources benefits among the riparian countries shall be on an equitable basis for mutual benefit;

Water Resources Strategy 2002: contd…

Institutional and legal frameworks for coordination and transparency shall be an essential feature of water sector management and

Wider adoption of the best existing technologies and practices, and rapid innovation and adaptation of both institutional arrangements and new technologies, shall be ensured.

Targets: Short term (5 years; by 2007): Implementation of the comprehensive Water Resources Strategy provides tangible benefits to people in line with basic needs fulfillment, supported and managed by capable institutions involving all stakeholders.

Policy Initiatives

Medium term (15 years; by 2017): The Water Resources Strategy is operationalized to provide substantial benefit to people for basic needs fulfillment as well as other increased benefits related to sustainable water use.

Water Resources Strategy 2002: contd…

Long term (25 years; by 2027): Benefits from water resources are maximized in Nepal in a sustainable manner.

Activities: Develop cost-effective small and medium hydropower to meet domestic demand at an affordable price.

Policy Initiatives

Encourage private sector investment in hydropower development and power distribution.

Water Resources Strategy 2002: contd…

Provide increased government support to accelerate rural electrification.

Integrate improved social and environmental mechanisms into hydropower development.

Encourage power based industries and transportation systems to create markets for large hydropower generation plants.

Activities: Facilitate the flow of funds from the domestic financial sector to the hydropower sub-sector.

Policy Initiatives

Strengthen institutional and physical infrastructure for power export.

Water Resources Strategy 2002: contd…

Promote hydropower research and development.

Restructure the power utility company.

Action Programs:1. Program to develop cost-effective micro, small and medium

hydropower .

Policy Initiatives

2. Program to enhance Rural Electrification .

National Water Plan 2004:

3. Program to Improve Power System Planning .

4. Program to encourage private investment in hydropower development and electric power distribution .

Prepared to Implement the Activities Identified by Water Resources Strategy

5. Program for Power Sector Reform and Development .

Conclusion

Strategies, Policies and Plans are:

Simple

Transparent

Dynamic

Follows IWRM Principles

Friendly to Private Power Producers

Thank YouThank YouEmail me arputhaselvaraj@gmail.com