HIDCL may invest in Upper Dordi 'A' hydro project

Hydroelectricity Investment and Development Company Limited (HIDCL), a public enterprise that was formed to address energy crisis in the country by injecting investment in the hydropower sector, is mulling over investing in Upper Dordi ´A´ hydropower project.
The project, which is estimated to cost Rs 4 billion, is being developed by Liberty Energy Hydropower Company Limited (LEHCL). The HIDCL has formed a risk assessment cell (RAC) to conduct a study on whether to invest in the project.
According to a source at the Ministry of Energy (MoE), the four-member RAC has already completed field study of the Lamjung-based project.
Keshav Dhwaj Adhikari, joint secretary at the MoE, leads the RAC. The other members of the RAC are Sagar Raj Gautam, senior divisional engineer at the Department of Electricity Development (DoED); Churna Bahadur Oli from DoED; and Sanjeev Baral, senior divisional engineer at the MoE.
Kush Kumar Joshi, chairman of LEHCL, said the HIDCL has agreed in principle to invest in the project. “Similarly, Nepal Investment Bank Limited (NIBL) is leading a consortium of banks to invest in the project. State-owned Nepal Bank Limited has also agreed to invest,” Joshi said. He further added that NIDC Development Bank, Global Bank and Grameen Bikas Bank are also in the consortium.
However, the HIDCL, which has already invested Rs 1billion in Myagdi-based Mistri Khola (42 MW) hydropower project, has not taken any official decision about investing in the Upper Dordi ´A´ project.
"The HIDCL will decide on the issue only after the RAC gives its suggestion," the source said. "The HIDCL does not have its own Act regarding investment."
Nepal Rastra Bank (NRB), the central monetary authority, has allowed it to make investment through commercial banks until it develop its investment regulation.
The project has already signed power purchase agreement (PPA) with Nepal Electricity Authority (NEA). As per the agreement, NEA will purchase power generated by it at Rs 4.8 per unit in the wet season and Rs 8.4 per unit in the dry season.
"We hope to get power generation license from the DoED soon," Joshi said.
The electricity generated from the proposed run-of-the river type project will be connected to the national power grid through the proposed Udipur Hub near Middle Marsyangdi Hydropower Project.
According to the company, it would need to build about 12 km long transmission line to connect energy generated from the project to the national grid.
"The project has payback period of be five years and seven months," according to information posted on LEHCL´s web portal.
The project will start generation within three years of the start of construction works.