Kathmandu: As per today’s exchange rate the Nine International Lenders have pledged to invest Rs 51 billion including International Finance Corporation in Upper Trishuli-1 project.
The 216-megawatt project is being developed by Nepal Water and Energy Development Company in Rasuwa district.
International Finance Corporation , the private sector lending arm of World Bank Group has 15%, and domestic Jade Power has 10% in NWEDC, Korea South East Power Co Ltd has 50% stake, Daelim Industrial Co Ltd has 15% share, Kyeryong Construction Co Ltd has 10% stake. The company will build up the project as per the build, own, operate, transfer model.
Previously, the project had received investment commitment of $60 million from Asian Development Bank, $171 million from IFC, $90 million from Asian Infrastructure Development Bank, $100 million from ExIm Bank of Korea, $35 million from Netherlands Development Finance Company and $50 million from Commonwealth Development Corporation. Similarly, Korea Trade Insurance Corporation have pledged $70 million, Proparco Development Bank, France, $25 million and Organisation of the Petroleum Exporting Countries $30 million for the project.
General manager of NWEDC ,Mr. Giri Raj Adhikari said that the ratio of investment by international lenders will be finalised and made public tomorrow. “The company will ink financial closure agreement worth Rs 51 billion ($450.3 million) with lenders tomorrow, while the construction is slated to begin in 2020.”– he added.
The project should be connected to the national grid by 31 March 2024 as indicated by NWEDC’s agreement with Nepal Electricity Authority. This is the largest foreign direct investment in a private sector-led hydropower project.
NWEDC and the Ministry of Energy started discussion for project development in January 2014, with the plan of initiating construction of the project in 2017. However, remaining to frequent change in government, the company could sign the project development agreement with the government only on 29 December 2016.
NEA has inked a dollar-denominated power purchase agreement with the company. This means the power utility will make payment in dollars for electricity generated by the project for the first 10 years or till the payback period of foreign loan from the commercial operation date, whichever comes first. NEA has offered tariff per unit at Rs 8.40 during dry season and Rs 4.80 during wet season.
The government has planned the project as backbone of power supply to Kathmandu Valley with being an alternative to Kulekhani reservoir project. Total energy generation capacity of the project is 1,533 gigawatt hours per year and the developer will supply 39 per cent or 106 MW of the total energy during dry season.
The developer will manage the project for a period of 30 years then the project will be handed over to the government in a good condition. The government will provide cent per cent corporate tax waiver for the initial 10 years and 50 per cent waiver for later five years.
Source : The Himalayan Times