Nepal and India signed a 25-year energy trade deal during Indian External Affairs Minister S Jaishankar's visit to Nepal on Thursday under which Nepal will export 10,000MW of electricity to India over the next 10 years.
Former Energy Secretary Dinesh Kumar Ghimire, who was among the officials involved in drafting the deal on behalf of Nepal, says the agreement is a blueprint for bilateral electricity trade that has significant implications for Nepal in the long term.
“This agreement has ensured that electricity produced in Nepal will get a market in India, thus giving investors confidence that India will buy Nepal’s electricity,” Ghimire adds.
Some have compared this to how India’s investment in power export projects in Bhutan have raised that country’s living standards, giving it the second highest GDP per capita in South Asia.&nbsp;
However, critics say India is behind like a colonial power and exploiting Nepal’s main resource for its own benefit not for electricity but to regulate the waters of the tributaries of the Ganges that flow down from Nepal.
The 10,000MW electricity to be exported within the next decade will also include power generated from India-constructed and supported projects, something that has caused experts to question whether the agreement will ultimately apply exclusively to electricity exported from current and future Indian hydropower projects in Nepal.&nbsp;
Two Indian state-owned companies, SVJN and NHPC, are currently involved in projects with a combined capacity of 4,600MW across Nepal. Meanwhile, India has been lobbying to construct more hydropower infrastructure, which could mean that 80% of the electricity exported under the bilateral agreement in the next 10 years will come from India-supported projects.
Read also: <a href="https://nepalitimes.com/multimedia/missing-pieces-of-the-hydropower-jigsaw">Missing pieces of the hydropower jigsaw</a>, Sonia Awale&nbsp;
The Nepal Electricity Authority (NEA) says that Nepal’s electricity generation capacity has exceeded 2,800MW, of which nearly 50% is consumed domestically. Although the NEA has been taking initiatives to export surplus power during the monsoon to India, the country has adopted a selective policy in regard to buying electricity from Nepal.
For instance, India has declared that it will not purchase electricity from projects that have Chinese and Pakistani involvement. That includes the 456MW Upper Tama Kosi project, which although built on Nepal’s investment had Chinese contractors from the company Sino Hydro.&nbsp;
In October 2021, the NEA received permission to sell 39MW of electricity at a competitive rate in the IEX, the Indian energy exchange market. India has to date increased that limit to 657MW, out of which Nepal exports 547MW to India's competitive market and 110MW falls under a medium-term bilateral export deal.
However, India-imposed quotas on power purchases have meant that more than 600MW worth of electricity goes to waste annually during the monsoon in Nepal.
Other critics say that the long-term power trade agreement has further deepened Nepal’s political dependence on India, and established an Indian monopoly over Nepal’s water resources.&nbsp;
Indeed, the agreement has made it clear that the trade will only involve hydropower projects with 'bilateral benefit’, which means that hydropower projects built with Chinese involvement will not find a market in India.&nbsp;
Read also: <a href="https://nepalitimes.com/here-now/india-nepal-ignore-climate-crisis-in-river-talks">India, Nepal ignore climate crisis in river talks</a>, Ramesh Bhushal
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This is in line with India's Conduct of Business Rule (CBR) issued in February 2021, under which the country will not import electricity from neighbouring countries that do not have an energy trade agreement.&nbsp;
Nepal does not have ongoing hydropower projects where Pakistan is involved, but India’s stance has resulted in numerous Chinese investors and contractors reconsidering their involvement in Nepal’s hydropower projects.&nbsp;
Former Energy Secretary Ghimire says government officials have continuously been raising questions about its policy on not purchasing electricity from Chinese-supported projects, adding that he is hopeful India will change current restrictions regarding China-supported and built projects in Nepal.&nbsp;
The country’s commitment to green energy is an important bargaining chip for Nepal, Ghimire notes. “Nepal needs to recognise India’s commitments towards renewable energy and formulate strategies accordingly to persuade Indian authorities to review their current policies,” he explains.
Krishna Acharya, former president of the Independent Power Producers' Association, Nepal (IPPAN), says that the current agreement is encouraging, but that Nepal needs to work quickly on its own policies related to power generation to support the deal.
“If Nepal’s private sector were to be allowed to enter the electricity business, there would be a lot less uncertainty in the market,” says Acharya.&nbsp;
NEA Executive Director Kulman Ghising is optimistic that India will be more lenient with its terms and conditions in the future.&nbsp;
Read also: <a href="https://www.nepalitimes.com/here-now/the-geopolitics-of-nepal-s-water-and-electricity">The geopolitics of Nepal’s water and electricity</a>, Ramesh Kumar
"The current agreement is historic, and we have to do our bit to make sure we implement it properly," he says, “we have to continue efforts to increase our exports beyond 10,000MW in the future.”
Nepal’s government has formulated an energy development strategy with a target of generating a total of 28,000MW of electricity within the next 12 years, out of which 13,000MW will be for domestic consumption and 15,000MW for export to other countries including India.
Also during the visit, India increased its assistance through High Impact Community Development Projects (HICDP) to Rs200 million, up from Rs50 million. Earlier known as small development projects, HICDP started with Rs30 in 2003 and was later increased to Rs50 million when Baburam Bhattarai was the prime minister.
While HICDP can help Nepal implement crucial development projects at the local levels, it will be entirely up to India to choose who and what to fund.
Under HICDP, local governments and NGOs can apply for assistance directly but as per the directive rural municipalities and municipalities should chip in 5% and 10% as counterpart funds. But even that is not binding.
Even so, such cooperation is contrary to Nepal's Constitution and federal policy on international cooperation. Taking such assistance without formally notifying the federal government is a 'red carpet' for foreign interference, critics say. Civil society members have called the deal non-transparent which is bound to weaken Nepal’s sovereignty.
Nepal’s Energy Secretary Gopal Sigdel and his Indian counterpart Pankaj Agrawal signed the agreement on behalf of the two countries.
The long-term bilateral agreement was first announced during Nepali Prime Minister Pushpa Kamal Dahal’s visit to India last May and was officially endorsed by India’s Council of Ministers in September.
Read also: <a href="https://nepalitimes.com/news/nepal-india-power-play">Nepal-India power play</a>, Ramesh Kumar

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Blueprint for Nepal-India electricity trade

Seen from a vantage point high above the Seti River near Damauli, excavators and tipper trucks look like tiny insects clawing away at a cliff. Occasionally there is the sound of dynamite blasting at the rock face. This is the Tanahu Hydropower Project, and it is an indication of how stagnant Nepal’s energy planning has been that this is only the second reservoir scheme after <a href="https://nepalitimes.com/banner/climate-smarter-himalayan-infrastructure">the Kulekhani Dam</a> was commissioned in 1982. &nbsp;&nbsp; The workers have nearly completed drilling a tunnel to divert the Seti’s turbid sediment-laden water so construction of the 140m high concrete dam can begin. When completed, the reservoir will be 7.25 sq km in area and store nearly 300 million m³ of monsoon runoff. And unlike Kulekhani, the Seti is a snow-fed river originating in the glacier below Annapurna 4.&nbsp;  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20231228101236_c757ef30ebe38c1fb97b2e57cac11eb6c237191f067b5e6d467933afeb49023b.jpg" data-media-id="editor_1" data-image-id="20231228101236_c757ef30ebe38c1fb97b2e57cac11eb6c237191f067b5e6d467933afeb49023b" data-rendition-name="original" width="624" height="400" loading="lazy" alt="Tanahu Hydropower"> </figure>   <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20231228101252_1f49967359964e87c73640576b17c765f6fe153a0fbd1c11f07cefe8012b60d1.jpg" data-media-id="editor_2" data-image-id="20231228101252_1f49967359964e87c73640576b17c765f6fe153a0fbd1c11f07cefe8012b60d1" data-rendition-name="original" width="1443" height="1111" loading="lazy" alt="Tanahu reservoir"> <figcaption>The 3D modelling of the Dam in Tanahu. Photo: TANAHU HYDROPOWER LIMITED</figcaption> </figure>  A 420m head on the Seti will take water through 7.25m wide tunnels and penstock pipes to an underground powerhouse to give the scheme an installed capacity of 140MW and an annual energy generation of 587.7GWh. While this capacity is less than other projects like Tama Kosi, the stored water can be drained at peak hours and during the dry season to augment electricity supply and keep the water flowing downstream. Also called Upper Seti, this project funded by the Japan International Cooperation Agency (JICA), Asian Development Bank (ADB), European Investment Bank (EIB) and Nepal Electricity Authority (NEA) is designed for at least six hours of peak operation during the driest months of the year. “Most of Nepal’s hydropower projects are run-of-the-river projects which means we can’t store water for winter months when domestic demand is highest,” says engineer Raja Bhai Shilpakar, Tanahu's project manager. “We must shift our focus to reservoir projects now to ensure Nepal’s energy security and to reduce power import.” Indeed, while Nepal has an installed capacity of around 2,800MW in the monsoon, and sold electricity worth Rs15 billion to India this summer, NEA is still importing power from Indian thermal plants to meet 30% of the winter demand.&nbsp;  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20231228101228_9c08ea43a75978bd194b02fbaf030ce5413d33609ff601e70d8912b60bde69e3.jpg" data-media-id="editor_3" data-image-id="20231228101228_9c08ea43a75978bd194b02fbaf030ce5413d33609ff601e70d8912b60bde69e3" data-rendition-name="original" width="1500" height="1125" loading="lazy" alt="Tanahu Hydropower"> <figcaption>GREEN ENERGY: Dam site of the under-construction Tanahu Hydropower Project with a 25km long reservoir which will be completed in May 2026. The concrete dam will be 140m in height and hold 295 million m³ of monsoon runoff. Photo: TANAHU HYDROPOWER LIMITED</figcaption> </figure>  Winter generation is low because the rivers are running low and this situation has been made worse by prolonged post-monsoon droughts. Last year, NEA said power supply fell by 20% of the winter average because there was no precipitation and melting of snow.&nbsp; In its new proposed draft, the National Planning Commission (NPC) has set a power generation target of 11,769MW in the next five years. The private sector, which generates nearly 80% of current electricity supply, is not so optimistic given the bureaucratic and financing hurdles. &nbsp; But even then, there will still be a supply shortfall unless more reservoir projects are built to even out the annual generation profile. Besides Tanahu, reservoir projects are planned on the Budi Gandaki, Tamor and Upper Arun, but those will not be ready for another ten years. Dams are also much more costly to build, and will need government involvement.&nbsp; Apart from local demands for compensation for submerged land, there are also concerns about the greater ecological impact of reservoir projects. Studies have shown that rampant dam construction leads to a decline in aquatic life, and livelihoods of people downstream.&nbsp; The other challenge is increasing risk of climate change-induced disasters like cloudbursts and Glacial Lake Outburst Floods that can wipe out expensive dams like the Chungthang Dam disaster in Sikkim in October.  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20231228101244_bf6f78d0758247f46bc156e116aacde6e20b6a02a7fa82057181914e4955f09a.jpg" data-media-id="editor_4" data-image-id="20231228101244_bf6f78d0758247f46bc156e116aacde6e20b6a02a7fa82057181914e4955f09a" data-rendition-name="original" width="1700" height="900" loading="lazy" alt="Hydropoer and dams in Nepal"> <figcaption>This underground powerhouse (centre) will give installed capacity of 140MW and an annual energy generation of 587.7GWh. Photos: SONIA AWALE</figcaption> </figure>  Nepal’s own Kulekhani was supposed to have a lifespan of 100 years but a cloudburst in the catchment area in 1993 deposited so much debris into the lake that the cascade power plants that generate 106MW of electricity from it will now function only for another 30 years.&nbsp; Shilpakar who was also involved in the Kulekhani project says lessons have been learnt, and Tanahu will have a flushing gate to drain sediment from the reservoir. It is considered too far downstream to be at risk from glacial lake bursts. &nbsp;The dam is also built to withstand earthquakes of much higher intensity than the 2015 event.&nbsp; “Tanahu is a concrete gravity dam with a much larger catchment than Kulekhani,” he explains. “But rainfall patterns have changed drastically. So we have added two flushing gates, increasing the dam’s lifespan to 120 years.” Despite the downside, most experts agree that reservoirs are crucial for flood control and dry season irrigation downstream, especially as water supply becomes scarcer with the climate crisis. Reservoirs also have other benefits like fisheries, inland navigation and tourism, as seen in Kulekhani. “In many ways, reservoirs are not just clean energy projects but also climate adaptive initiatives,” says Pushkar Manandhar of the ADB. “Storage hydropower serves as a buffer to cope with erratic rainfall and act as a shock absorber. They store water to augment lean season flow of rivers.” But water is a <a href="https://nepalitimes.com/here-now/the-geopolitics-of-nepal-s-water-and-electricity">geopolitical hot potato in the region</a> with India’s increased involvement in building river schemes in Nepal, including Pancheswar Dam on the border Mahakali River, Arun III, West Seti reservoir, and other projects. Experts say India’s real interest is in water supply, and would not mind if it gets regulated water for free from reservoirs like Tanahu in Nepal.&nbsp;  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20231228101240_f5a3473abe0186d1fb7842724607238abd3c8671c91c8e8a4bfebfbc63591aa4.jpg" data-media-id="editor_6" data-image-id="20231228101240_f5a3473abe0186d1fb7842724607238abd3c8671c91c8e8a4bfebfbc63591aa4" data-rendition-name="original" width="1500" height="1125" loading="lazy" alt="Hydropoer and dams in Nepal NT 1"> <figcaption>Tanahu hydropower dam site.</figcaption> </figure>  But India is playing hardball by refusing to buy electricity from projects it deems to have Chinese investment or involvement. In Tanahu, meanwhile, engineers are running out of explosives because of a ban on export of dynamite by India.&nbsp; Says Shilpakar: “No contractor is getting an explosive permit from India and we cannot get any from the Chinese either, we need the government-to-government deals otherwise the project could be delayed.” Tanahu also includes the construction of a 220kV double circuit Damauli-Bharatpur transmission line and is looking at a completion date of May 2026. There are also plans for a 126MW Lower Seti cascade project with a dam at Saranghat, and a powerhouse at Mugling to generate 520GWh. Experts say that along with new reservoir projects, Nepal now needs to <a href="https://nepalitimes.com/news/balance-of-power">pay attention to transmission and distribution</a> to streamline supply so that domestic consumption increases. &nbsp; “We didn’t develop all aspects of hydro schemes in parallel,” says ADB’s Manandhar. “We focused mostly on generation and now there is a real bottleneck in transmission and distribution.” Kathmandu is a load centre, but transmission lines do not have the capacity to bring the electricity from power plants in central and eastern Nepal.&nbsp; “We have to build substations to future-proof supply, but there are issues with right of way and land acquisition,” Manandhar adds.&nbsp; Which is why NEA is working at speed to upgrade its substation in Siuchatar, with a state-of-the-art Distribution System Control and Data Centre so that power supply to localities in the Valley can be monitored and controlled more efficiently.&nbsp;  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20231228101248_dae5f9c304943d4efb156a9930b0ca1894b2f6b915abeb6c30d510e0f246e4a5.jpg" data-media-id="editor_8" data-image-id="20231228101248_dae5f9c304943d4efb156a9930b0ca1894b2f6b915abeb6c30d510e0f246e4a5" data-rendition-name="original" width="1500" height="1125" loading="lazy" alt="Distribution substations"> <figcaption>Distribution System Control and Data Centre in Siuchatar.</figcaption> </figure>   <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20231228101252_fb9c41952a2c918b2a8eccbd5483bcd28378e43eb533d3edfcd2c2b82a495255.jpg" data-media-id="editor_9" data-image-id="20231228101252_fb9c41952a2c918b2a8eccbd5483bcd28378e43eb533d3edfcd2c2b82a495255" data-rendition-name="original" width="1500" height="1125" loading="lazy" alt="Transmission lines"> </figure>  “If there is a fault in distribution, we will be able to see it from here, we won’t need locals to call us anymore,” says electrical engineer Dhirendra Bajgain. “At the same time, we will be able to quickly restore the fault, in minutes instead of hours by just isolating that area.” But elsewhere, like in the Dana substation near Kushma of Parbat district, authorities are dealing with a different kind of <a href="https://nepalitimes.com/here-now/nepal-s-precious-electricity-going-waste">power spill</a>. Pritam Raj Bista of the Parbat Distribution Centre says that while there is 100% electrification, the total number of consumers is decreasing due to depopulation.&nbsp; In contrast, nearly 170km south in Dhakdahi near Butwal, demand is peaking with local industries complaining about not getting dedicated feeder lines on time. Even when Nepal did away with power rationing, the area was still facing power cuts until Dhakdahi substation was set up a few years ago. The new substation shared the power load with the Butwal substation and the area has been getting improved voltage and power quality.&nbsp; At the recently inaugurated Kushma-New Butwal 220kV substation to evacuate power from the Kali Gandaki Transmission Corridor, the NEA’s Kulman Ghising said his main priority now was to invest in transmission and distribution infrastructure. “Butwal is critical because it is at the intersection of the Kali Gandaki corridor in central Nepal and the East-West transmission artery,” Ghising said. “It is a pooling hub for power transmission and distribution westwards and for export to India.”  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20231228101248_635bc1ff0aec0f15a1874a56b81d61113abcd8f5d2ded97271c5c90f20ecd643.jpg" data-media-id="editor_11" data-image-id="20231228101248_635bc1ff0aec0f15a1874a56b81d61113abcd8f5d2ded97271c5c90f20ecd643" data-rendition-name="original" width="1220" height="1500" loading="lazy" alt="Transmission lines"> <figcaption>Transmission lines at the recently inaugurated Kushma-New Butwal 220kV substation which will evaculate power from the Kali Gandaki Transmission Corridor. </figcaption> </figure>  Indeed, these transmission lines will dovetail with t<a href="https://nepalitimes.com/editorial/challenge-of-the-millennium">he Millennium Challenge Compact</a> (MCC)-supported lines from Hetauda via Damauli. The challenge now, Ghising says, is local compensation demands to transmission lines which have delayed them.&nbsp; “Our field staff spend 90% of their time dealing with local opposition, social and environmental regulations,” he added. Transmission lines under the MCC project are likely to face even stronger opposition because of <a href="https://nepalitimes.com/editorial/the-message-is-the-medium-z5w3ekk2">political opposition to the US-funded initiative</a>, and local belief that the project has lots of money.&nbsp; If Nepal is to save its economy and meet net-zero targets by 2045, increasing domestic demand should be the priority, and for this, reservoir projects, transmission lines and distribution infrastructure are key.&nbsp;  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/20231228101248_985e74ee96fef5c92a828612ff7c97a05ba34a61c490a5e578f3c592af986584.jpg" data-media-id="editor_14" data-image-id="20231228101248_985e74ee96fef5c92a828612ff7c97a05ba34a61c490a5e578f3c592af986584" data-rendition-name="original" width="1500" height="1125" loading="lazy" alt="Transmission lines"> </figure>  Nepal could export more electricity but India is buying less than 700MW from Nepal because of <a href="https://nepalitimes.com/here-now/geopolitics-of-nepal-s-rivers">Chinese involvement in projects</a>. It is therefore in Nepal’s own strategic interest to increase domestic demand as much as possible.&nbsp; Even if Nepal could sell all its present electricity generation, it would amount to a mere Rs20 billion against an annual trade deficit with India at a staggering Rs840 billion. &nbsp; Instead, if <a href="https://nepalitimes.com/here-now/fueling-nepal-s-economic-crisis">we reduce just 10% of our petroleum bill</a> by electrifying industries, household use and transport, Nepal can save at least Rs30 billion a year. Improving public health and ecology will be a bonus.&nbsp; “If we sell electricity, we just get cash benefits but if we were to make the maximum use of our power within the country, there will be cascade impacts,” says engineer Raja Bhai Shilpakar. “We can revolutionise our industries and manufacturing, create jobs and prevent young talented people from migrating.” &nbsp;

Sonia Awale

Missing pieces of the hydropower jigsaw

Tipper trucks piled with cement rumble along the rocky 15km road that runs alongside the Trisuli River that flows out of glaciers in Tibet and tumbles through mighty gorges into Nepal. &nbsp; It is the steep gradient of this frothing river that makes it so ideal to generate hydropower. Which is why there are eight existing or planned run-of-the-river schemes in a cascade along the Bhote Kosi. The narrow valley reverberates with the roar of excavators, drills and a mix of Korean, Chinese and Nepali voices among the workers in the newest plant under construction on the river: the Rs65 billion 216MW Upper Trisuli-1 hydropower project. Despite its proximity to Kathmandu, Rasuwa had largely been bypassed in Nepal’s infrastructure development. Even after India helped build the Trisuli (1967) and Devighat (1984) plants, investment here languished. But after 1990, politicians started promising that the district would prosper from the ‘white gold’ of the Bhote Kosi, there would be jobs, industries and money would pour into the local economy.&nbsp; The biggest and newest of these projects is the Upper Trisuli-1 and it was sold to the indigenous Tamang community as their economic salvation. But far from jobs and economic benefits, local farmers have seen the destruction of their ancestral land and sacred sites.&nbsp; Read also: <a href="https://www.nepalitimes.com/here-now/geopolitics-of-nepal-s-rivers">Geopolitics of Nepal’s rivers</a>, Ramesh Kumar  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/2023061915060_50d23587983b4e48dee2b5a387824cd152192d41f5ffbc5ec4ec62ffd973ce20.jpg" data-media-id="editor_1" data-image-id="2023061915060_50d23587983b4e48dee2b5a387824cd152192d41f5ffbc5ec4ec62ffd973ce20" data-rendition-name="original" width="2976" height="1984" loading="lazy" alt="Rasuwa NT 1"> </figure>  “We had hoped that this project would finally bring us resources for local development that we sorely needed, but it has only made our lives more difficult,” says Ashabir Tamang from Mailungbesi village by the Bhote Kosi. A decade has passed since the Nepal Water and Energy Development Company (NWEDC) began exploring the Upper Trisuli-1 project in Mailungbesi. Financing was secured from Korea (75%), the International Finance Corporation (IFC) with 15% and 10% from the local Nepali partner Bkesh Pradhanang. Asian Development Bank, Asian Infrastructure Investment Bank, Dutch Development Bank and other international banks also have investments. During the project design phase the IFC, which is also the primary loan manager for the project, had stipulated that its PS-7 performance criteria be applied to the project. The stipulation seeks to ensure that business activities minimise negative impacts, foster respect for human rights, dignity and culture of indigenous populations, and promote development benefits in culturally appropriate ways. The NWEDC was therefore forced to enter into an FPIC agreement (Free, Prior and Open Consent) with the indigenous Tamang community. Nepal became a signatory to the ILO Convention 169 in 2007, which gave local and indigenous communities the right to have a say in benefits. This agreement between the NWEDC and the Indigenous Advisory Council that represents the local community, and the local government stated that about Rs140 million would be spent on sustainable socio-cultural and economic development projects in five years. Read also:<a href="https://www.nepalitimes.com/news/nepal-india-power-play"> Nepal-India power play</a>, Ramesh Kumar  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/2023061915060_6bf538032acd41023e2277af852adaee745be79e59f4d32261ff02d3ede9bddf.jpg" data-media-id="editor_3" data-image-id="2023061915060_6bf538032acd41023e2277af852adaee745be79e59f4d32261ff02d3ede9bddf" data-rendition-name="original" width="2976" height="1984" loading="lazy" alt="Rasuwa NT 1"> </figure>  Although it required that the consent of local communities would be needed before land acquisition and resource management began, the request was made only when the project reached the implementation stage. Says Ashabir Tamang, who is also vice-chair of the Indigenous Advisory Council: “The funding for indigenous development projects that we agreed on has not yet been released, the company is violating the contract and cheating us.” NWEDC Director Giriraj Adhikari admits the company is yet to release the funds as per the agreement, but adds that the company needs to adhere to the financial protocols of international partners involved in the project. "Funds have already been allocated for local welfare, but procedural issues have meant that they have yet to be sent to Nepal from overseas,” he says. Upper Trisuli-1 is the first infrastructure project in Nepal to try to implement an FPIC agreement to increase self-employment for local communities and minimise adverse environmental effects. However, local activists say the agreement applies to only 10 out of 21 areas in the project site, and does not include outlying communities and it disregards their customs and institutions. Residents also have complaints about lack of compensation for damage to property during construction-related demolition and river diversion. &nbsp;On top of that, forests, rivers, wetlands and traditional grazing areas locals have used for generations are located in areas surrounding the intake and powerhouse.&nbsp; Read also: <a href="https://www.nepalitimes.com/here-now/the-geopolitics-of-nepal-s-water-and-electricity">The geopolitics of Nepal’s water and electricity</a>, Ramesh Kumar  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/2023061915060_dbbc8e1be28bb2dfe2b3886ee3a4b3a69c4126e21c8703ef62477a8808c3984f.jpg" data-media-id="editor_5" data-image-id="2023061915060_dbbc8e1be28bb2dfe2b3886ee3a4b3a69c4126e21c8703ef62477a8808c3984f" data-rendition-name="original" width="1500" height="1000" loading="lazy" alt="Rasuwa NT 1"> </figure>  Ashabir Tamang's gripe is that the project has not fulfilled a single obligation to local residents and has essentially bypassed the community on whose land the project is being built. “With the monsoon soon coming, we live in constant fear that landslides will wipe out our entire village,” says Tamang. “Where do we go to complain? No one listens to us.”&nbsp; The memory and fear of landslide is real and fresh. Mailingbesi’s 60 households were nearly entirely buried in the 2015 earthquake, and 20 residents lost their lives. Among those killed were nine members of Ashabir Tamang’s own family, including his young grandchildren. There are 790 other households in surrounding villages that were also impacted by the earthquakes. Many of them never received the promised government grant to rebuild.&nbsp; Eight years after the earthquake, many homes are still buried in debris. The boulders and soil have still not been cleared. Only half of Mailungbesi’s population remains in the village, while the rest have moved on to other villages in Rasuwa and Nuwakot.&nbsp; Those that remain face a host of problems, including where to send their children to school, the nearest primary school is a half-hour walk away in Salletar. Parents wait in fear, hoping their children will not be hit by rockfalls on their way to and from school. Read also: <a href="https://www.nepalitimes.com/here-now/nepal-s-precious-electricity-going-waste">Nepal’s precious electricity going waste</a>, Anita Bhetwal  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/2023061915060_977d7508a26d0ccbc3d8bcf633b67a9cd09ab0081f57d89f8662836d801196be.jpg" data-media-id="editor_7" data-image-id="2023061915060_977d7508a26d0ccbc3d8bcf633b67a9cd09ab0081f57d89f8662836d801196be" data-rendition-name="original" width="2976" height="1984" loading="lazy" alt="Rasuwa NT 1"> </figure>  “It is like waiting for another disaster to strike,” says Som Bahadur Tamang, another resident. Project-related demolition work, tunnel construction as well as the constant movement of heavy earthmoving vehicles have destabilised the slopes, the ground shakes constantly, and rocks frequently fall from the cliffs above. Kanchhi Maya Tamang tells us of her fears. She says, “I do not worry so much during the day, but I lie awake at night wondering if the river will sweep away our house with us inside or a landslide will bury us alive.”&nbsp; Inaam Tamang rebuilt his house with concrete after the earthquake, but says cracks have appeared and one of the rooms was carried away by the river when the project diverted the river. “No one listened to us when we asked that walls be built around our homes to protect us,” he says. “They do not care about us small people.”&nbsp; Read also: <a href="https://www.nepalitimes.com/opinion/comment/securing-nepal-s-electric-future">Securing Nepal’s electric future</a>, Kumar Pandey  <figure> <img src="https://publisher-publish.s3.eu-central-1.amazonaws.com/pb-nepalitimes/swp/asv65r/media/2023061915060_4a0d1555b13f97199910a8d23b8f4379fdefd44c9f39cb102eb6e3d989d2ddef.jpg" data-media-id="editor_9" data-image-id="2023061915060_4a0d1555b13f97199910a8d23b8f4379fdefd44c9f39cb102eb6e3d989d2ddef" data-rendition-name="original" width="2976" height="1984" loading="lazy" alt="Rasuwa NT 1"> </figure>  Down in Hakubesi and Phulbari, 110 households were displaced by the project and only got partial compensation. Locals are also angry that while there are able-bodied men looking for jobs in the villages, the project is bringing in drivers and construction workers from outside. &nbsp; Kanchhi Maya Tamang, 55, was hired as a cleaner, but sacked for being too old. “Do you think someone who has carried fodder and firewood from the mountains all her life is not strong enough to sweep the floor?” she asks.&nbsp; Saraswati Tamang, who owns a grocery store in Mailungbesi, says she has not seen the expected boom in business after the project got going. This despite there being 800 Nepali, Chinese, and Korean technicians living in the area. “They bring everything from Kathmandu,” she says. “Not just groceries, even live chicken, ducks, goats and pigs. We have not gained much, we were just uprooted.”&nbsp; Director Adhikari refutes allegations that locals were not given jobs, and says 900 residents were hired and given project-related contracts. But &nbsp;admits that even though the company is taking initiatives to ensure benefits to the local economy, not all demands can be met.&nbsp; Read also: <a href="https://www.nepalitimes.com/multimedia/nepal-s-first-hydropower-from-a-glacial-lake">Nepal’s first hydropower from a glacial lake</a>, Kunda Dixit

Nepal’s curse of the white gold

<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221114131112/637230969c7e80680e0c2574jpeg.jpg" alt="" width="1500" height="1000"/><figcaption>The Kulekhani Dam opened in 1982, and is still the only large reservoir project in Nepal. Photos: NT ARCHIVE</figcaption></figure>A rapidly warming atmosphere is <a href="https://www.nepalitimes.com/banner/nepals-mountains-are-melting/" target="_blank" rel="noopener noreferrer">melting Himalayan glaciers</a>, changing the seasonal flow of water in Nepal’s rivers, and increasing the interest of downstream India to regulate water and generate electricity.For Nepal, this is an opportunity to finally tap the potential of the country’s ‘white gold' to meet growing demand for electricity domestically, as well as redress its trade deficit with India by selling <a href="https://www.nepalitimes.com/banner/nepals-precious-electricity-going-waste/" target="_blank" rel="noopener noreferrer">surplus power</a>.New Delhi’s priority has been not so much electricity but to try to regulate the flow of the Ganges by storing monsoon runoff in its Himalayan tributaries in Nepal, which is why it has lately started showing an interest in building large <a href="https://archive.nepalitimes.com/article/nation/reservoirs-of-suspicion/hydropower-geopolitics%20,3991" target="_blank" rel="noopener noreferrer">reservoir projects in Nepal</a>.“There is no doubt that India's real interest is in Nepal’s water resources rather than hydroelectricity,” says Sheetal Babu Regmi, formerly head of the Water and Energy Commission. “And water is going to be an even more critical commodity with the climate crisis.”Almost two-thirds of the water in the Ganges that flows through some of the most densely-populated regions in the world comes from the rivers of Nepal. And most of that flows down in the four monsoon months between June-September.In the rainy season, there are destructive floods in the plains, and for nine months in a year, the rivers have low flow. <a href="https://archive.nepalitimes.com/regular-columns/Comment/storing-water-reservoir-Nepal,1042" target="_blank" rel="noopener noreferrer">Storage dams in Nepal</a> would even this out, reducing flood damage during the monsoon, and make adequate water available the rest of the year.Climate change means that there will be even less water flowing in the Ganges and its tributaries in the dry season in the coming decades.A recent report by India's NITI Ayog showed that nearly 600 million Indians are facing a shortage of water for irrigation and household use, and singled out 21 cities, including New Delhi, as potentially facing groundwater depletion by 2030.Another report by ICIMOD (the Kathmandu-based International Centre for Integrated Mountain Development) warned that failure to reduce carbon emissions would lead to the <a href="https://www.nepalitimes.com/banner/a-terrifying-assessment-of-himalayan-melting/" target="_blank" rel="noopener noreferrer">Himalaya losing up to two-thirds of its remaining glaciers</a> during this century.It is therefore strategically important for India to ensure regulated year-round water on the Ganges, and for this it needs a government in Kathmandu that is amenable to allowing it to build large reservoirs on Nepal’s rivers.However, given the historical asymmetry of past Indian projects on <a href="https://www.nepalitimes.com/banner/the-kosis-sorrow-and-scope/" target="_blank" rel="noopener noreferrer">the Kosi</a> and Gandaki, river projects are political hot potatoes in Nepal. Governments in the past have fallen because incumbents signed off on river treaties with India that were deemed to disproportionately benefit India.<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221114131112/637230999c7e80680e0c2575jpeg.jpg" alt="" width="1185" height="774"><figcaption> </figcaption></figure>Which is what makes the timing of announcements of a slew of new Indian investment in river projects in Nepal after Prime Minister Sher Bahadur Deuba-led coalition came to power last year so significant.On 14 June, Nepal’s cabinet gave permission to India’s state-owned NHPC Limited (formerly the National Hydroelectric Power Corporation) to build the 750MW West Seti hydropower project. The China Three Gorges International Corp (CTG) had in 2018 been edged out of the reservoir project with a 194m high dam in western Nepal.The NHPC had made a proposal to Nepal’s Investment Board in May for the construction of the project following promises made by Prime Minister Deuba during his visit to India in March. And while on the campaign trail in Dadeldhura in May, Deuba had revealed that construction of the West Seti would have to be given to India because otherwise New Delhi would not buy electricity off projects with Chinese investment.But experts have raised serious issues with the way such a large project has been handed over to Indian companies without the requisite competitive bidding process, and using a legal loophole to circumvent Nepal’s Public Private Partnership and Investment Act.An agreement to hand over a 51% stake in the construction of the <a href="https://www.nepalitimes.com/business/arun-4/" target="_blank" rel="noopener noreferrer">Arun-4 hydropower project</a> to another Indian state-owned company, Sutlej Hydropower Corporation, was also made in June during Indian Prime Minister Narendra Modi’s visit to Lumbini.Arun-4 follows Sutlej’s joint venture on the upstream <a href="https://www.nepalitimes.com/latest/oli-modi-launch-arun-iii/" target="_blank" rel="noopener noreferrer">Arun-3 project</a> in eastern Nepal, and the government was so secretive about the deal that Nepalis came to know about it only after Nepal Electricity Authority (NEA) executive director Kulman Ghising signed the agreement in Lumbini with Sutlej Hydropower chair Nand Lal Sharma.Sutlej Hydropower earlier acquired the 679MW Lower Arun project construction rights under former prime minister K P Sharma Oli. The cascade of Indian projects on the Arun River will generate 2,000MW of electricity in eastern Nepal.And with West Seti and Upper Karnali projects, Indian companies will be generating another 2,000MW of electricity from western Nepal for export to India.Additionally, the government is also planning to award the 450MW Seti River-6 project to NHPC. Sources at the Investment Board Nepal say that the Indian company is taking most of the electricity, and offering only 3% of free electricity to Nepal. The NHPC has also submitted a proposal for the 480MW Phukot Karnali and the 1,902MW Mugu Karnali projects in north-western Nepal.<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221114131112/6372309c9c7e80680e0c2576jpeg.jpg" alt="" width="800" height="471"><figcaption> </figcaption></figure>The fact that all these projects have been announced only after Deuba replaced K P Oli as prime minister last year indicates that his coalition partners have been friendlier to Indian proposals on river projects than previous governments.Indeed, the 900MW Upper Karnali hydroelectric project which was awarded in 2014 to the Indian private company GMR was given a two-year extension despite its failure to finalise investment.“Nepal is playing a geopolitical game with hydropower, flouting the Constitution and prevailing laws,” says former water resource minister Dipak Gyawali.Nepal’s Constitution stipulates that treaties or agreements related to the distribution of natural resources and their use must be approved by a two-third majority in the Federal Parliament.Other experts however, say that Nepal cannot just sit on its rivers, it must harness them for economic progress, and for this it has to cooperate with India on an equal footing for mutual benefit.“Indian investment in the hydropower sector will benefit Nepal, it will mean the electricity we generate will find a ready market in India and reduce our trade deficit,” says NEA director Kulman Ghising.However, it is the fear that India will derive disproportionate benefit from these joint projects that worries Nepali experts, especially since there is historical precedent for that.India has also put pressure on Nepal by refusing to buy electricity from projects built with investment or contractors from China. India refused to buy surplus power from Nepal this monsoon, wasting 500MW of electricity. Chinese investors are presently involved in building hydropower plants with a total capacity of 1,000MW.Deuba reached an energy-sharing agreement during his India visit in March, under which the Central Electricity Authority of India approved 364MW of electricity imports from six hydropower projects in Nepal -- but only those not built by the Chinese.Foreign policy experts have seen a clear departure on the part of Prime Minister Deuba towards India on river basin projects, with Indian companies being favoured over Chinese ones.<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221114131112/6372309e9c7e80680e0c2577jpeg.jpg" alt="" width="1920" height="1080"><figcaption> </figcaption></figure>In March, the Deuba-led government decided to revoke the license issued to the China Gezhouba Group Company (CGGC) to develop the mammoth <a href="https://www.nepalitimes.com/banner/nepals-mega-dam-is-a-mirage/" target="_blank" rel="noopener noreferrer">$2.5 billion Budi Gandaki hydropower project</a> west of Kathmandu, and to build its 263m high dam to generate 1,200MW on its own.The Budi Gandaki has been a victim of geopolitical pingpong for the past five years. In 2017, Maoist Prime Minister Pushpa Kamal Dahal’s government awarded the project to CGGC, but the subsequent Deuba government reversed the decision, angering the Chinese. In 2018, K P Oli’s administration restored the contract, only to have Deuba cancel it again this year.Chinese Ambassador Hou Yanqi stated in May that it was “wrong to change policy (on Budi Gandaki) with every change of government … such actions kill the investment climate”.“It is not diplomatically mature to repeatedly undo decisions of preceding governments every time power changes hands,” cautions foreign affairs expert Dinesh Bhattarai.Experts say that India’s policy on it energy imports from Nepal will not only just discourage future Chinese investments in Nepal which is its goal, but also other investors. It will also throw Nepal’s policy of equidistance between China and India off balance.All this is not new. Before Three Gorges, Australia’s Snowy Mountain Engineering Company (SMEC) also pulled out of the West Seti project in 2010 after India showed no interest in buying its electricity. Then the Norwegian company SN Power abandoned the export-oriented 650MW Tamakosi 3 after not getting the green light from New Delhi to buy its power.Most of Nepal’s hydropower projects so far are run-of-river schemes in which generation capacity falls during the dry season. This means Nepal has a power deficit in winter when it needs to import from India, and has a surplus in the monsoon which it has started exporting to India.Having reservoir projects would change that, and give Nepal a more year-round generation capacity, while also regulating water on rivers as a bonus. But even with the present hydropower projects, Nepal earned Rs1.72 billion just in June from selling its excess electricity to India.“India considers water a strategic resource, and is cleverly trying to keep Nepal's energy system under its influence,” explains Dipak Gyawali, the former minister.Clearly, Nepal needs to prioritise domestic consumption of electricity over its export and channel it into electrification of transport, industries and homes. All of this will automatically cut down on petroleum imports, reducing its increasing trade deficit.Selling raw electricity to India is not as beneficial, experts point out, because Nepal is selling its power at a much cheaper rate to India than to domestic consumers. Switching to electric vehicles to reduce Nepal’s petroleum import bill by just 10% would save the country over Rs30 billion a year.The combined capacity of Nepal’s hydropower projects has now exceeded 2,100MW even as average domestic demand stands at just 1,550 MW. Another 2,500MW of electricity will be added to the grid in the next two years, while 3,000MW of new projects are in the pipeline.In a few short years, Nepal will have surplus year-round electricity, and experts say it will be better for the economy to use the power within Nepal to manufacture value-added products than to rely so heavily on selling power to India.They say Nepal needs to rework its energy needs so as to increase domestic consumption, and cut its widening trade deficit with India by reducing petroleum imports rather than just exporting power.

The geopolitics of Nepal’s water and electricity

<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022111410118/637205999c7e80680e0b28c6jpeg.jpg" alt="" width="1920" height="1080"/><figcaption>When the only ambulance in Diprung Chuichumma could not attend to all the emergencies, Chair Bhupendra Rai himself drove the infected to health centres.</figcaption></figure>KhotangLast year, as Nepal plunged headlong into <a href="https://www.nepalitimes.com/banner/the-real-cost-of-nepals-second-wave/" target="_blank" rel="noopener noreferrer">the second wave</a> of Covid-19, cities around the country including Kathmandu Valley announced lockdowns, and people of Diprung Chuichumma Rural Municipality of Khotang streamed back home.The people were home, but they also brought the virus with them. The only ambulance in the municipality could not attend to all the emergencies, so Chair Bhupendra Rai donned a PPE and started driving the infected to the health centre in his own car. Sometimes, he would go door-to-door carrying patients on his back to the car.The municipality set up a 25-bed isolation centre, ramped up awareness campaigns, and carried out antigen tests. Vice-chair Sapana Rai was equally involved. Those who couldn’t be treated inside the municipality were taken to hospitals in Kathmandu and  Biratnagar.“We entered politics for the people. So, when they were suffering, we couldn’t just sit back and relax, we had to be hands-on in serving them and taking the lead from the front,” Bhupendra Rai told us on the phone from Khotang as he waits for word on <a href="https://www.nepalitimes.com/banner/dance-of-democracy/" target="_blank" rel="noopener noreferrer">the date for local elections slated for April</a>.This <a href="https://www.nepalitimes.com/latest/nepals-local-governments-lead-from-the-front/" target="_blank" rel="noopener noreferrer">local government team was proof</a> that elected grassroots politicians understand the need of their area, are more accountable, and are willing to serve their constituents.The Omicron surge is spreading, but this time there are not as many cases of Covid-19 in the village. But the Rais are not taking any chances. The municipality has increased the number of antigen tests and encouraged the infected to isolate at home.<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022111410118/6372059c9c7e80680e0b28c7jpeg.jpg" alt="" width="2048" height="1152"><figcaption> </figcaption></figure>Kathmandu may have a shortage of cetamol painkillers, but there is plenty stockpiled here to meet villagers’ needs. And the municipality has deployed health volunteers to accelerate the vaccination drive.“Whoever could walk to the centre are all vaccinated, now we need to reach those who cannot come on their own,” says Rai.As schools nationwide remained closed during the lockdown, the municipality deployed more than 200 teachers with masks on who went house-to-house tutoring students. It also bought produce from local farmers who could not take it to market due to the lockdown and distributed to needy families. This ensured food security as well as income for the local farmers.When Bhupendra Rai was elected in 2017, there were not enough roads in his rural municipality. Every monsoon, the constituency would be locked in as the Sunkosi and Sapsi river flooded. Today, a motorable bridge connects this remote village to the rest of the country. Every household has electricity and access to drinking water.“All this would not have been possible without the local elections and local representatives in place, it forced us to perform,” says Rai.Tehrathum<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022111410118/6372059f9c7e80680e0b28c8jpeg.jpg" alt="" width="2048" height="1149"><figcaption> </figcaption></figure>To the east in Laligurans Municpality, Tehrathum Mayor Arjun Mabuhang also worked on connectivity as soon as he got elected five years ago. Having seen <a href="https://www.nepalitimes.com/uncategorized/elected-contractors/">rampant corruption in road contracts</a>, Mabuhang got the municipality to buy its own excavators to build roads with the help of locals, cancelling out middlemen.“Now all the wards have roads and there is ownership amongst the people because they themselves were involved in building them,” says Mabuhang.He also introduced a program to upgrade agriculture by supporting dairy farmers and offering grants for vegetable and fruit farming, poultry, and pig farms. The roads helped get the produce to market.Says the mayor: “Because I am from here and I myself have seen the ground reality and know what the people here need, I work in the areas that benefit the people most. We did what we could with the budget we were given, but we need to work more on improving schools.”Sindhupalchok<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022111410118/637205a39c7e80680e0b28c9jpeg.jpg" alt="" width="960" height="720"><figcaption> </figcaption></figure>In Sindhupalchok’s Jugal Rural Municipality, Deputy Chair Srijana Tamang has been single-mindedly working on improving education. As a child, she remembers walking for hours from home to school and back. In winter night fell quickly on her way home, and during the monsoon she would be covered from head to toe in leeches.When she was elected five years ago, one of the first things Tamang and Chair Hom Narayan Shrestha worked on was to appoint new teachers and upgrade school buildings, some of them destroyed in the earthquake.Having worked as a social worker in the past, Tamang recognised the priority areas for her rural municipality, and her background and familiarity with the people helped her not only gain an edge during the elections but prepared her to deal with the problems of her community.“When I was elected, I really wanted to prioritise roads and education, but <a href="https://www.nepalitimes.com/latest/rural-nepal-fights-back-covid-19/" target="_blank" rel="noopener noreferrer">the pandemic meant we had to address more urgent issues</a>,” adds Tamang, who offered RT PCR testing and monitored the spread of the disease, turning a local school into an isolation centre. With Omicron, Tamang believes the people are more aware, and better prepared.“The pandemic was the first big challenge for me as a local representative,” says Tamang. “But knowing that we are working for our people and our families, there is always a greater sense of responsibility.”In 2020, while Tamang was away on official business, a <a href="https://www.nepalitimes.com/here-now/deadly-monsoon-in-nepal-turns-deadlier/" target="_blank" rel="noopener noreferrer">massive landslide at Lidi</a> killed 39. She travelled overnight to help with the rescue and relief effort and got support to rehabilitate those made homeless. She got geologists to prepare a disaster risk map of her municipality to prevent future disasters, and prepare for them.Jhapa<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022111410118/637205a69c7e80680e0b28cajpeg.jpg" alt="" width="2048" height="1536"><figcaption> </figcaption></figure>Jhapa’s, Kamal Rural Municipality has the distinction of being among <a href="https://www.himalkhabar.com/news/125595?fbclid=IwAR1g00nElAMlIzStd-FiN7M-f6PZ1H3KQXE6V0f8Y4ztDNxclOSJ9KWQPZs" target="_blank" rel="noopener noreferrer">four of the 753 municipalities around the country ranked cleanest</a> in budget disbursement by the Office of Auditor General. It is a well-deserved recognition for Chair Menuka Kafle for whom tackling leakage and corruption was a priority.For any project with a budget over Rs5 million, the municipality went through a strict tender process. It also stopped giving out advances for projects and kept track of expenditure.“For the others to follow the rules, we had to lead by example, so we made sure that we were meticulous about accounting,” says Kafle.Over the last five years, the rural municipality has constructed more than 70km of roads, upgraded bridges, and ensured that all wards have electricity. Kafle distributed carts to women fruit and vegetable vendors and launched income generation activities for women.“When women are economically independent, they don’t have to depend on others and can make their own decisions,” says Kafle.The municipality offered cash incentives to encourage pregnant women to visit health centres for regular check-ups and registration of new-borns. When Kafle first got elected, many people in the community <a href="https://www.nepalitimes.com/latest/is-democracy-too-expensive-for-nepal/">did not believe that a woman could run the office</a>.During important meetings people would ignore her and seek out the male Deputy Chair. These days Kafle is in high demand.<img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022111410118/637205a99c7e80680e0b28cbjpeg.jpg" alt="" width="1080" height="486">Says Kafle: “We women who are in power have to work hard to build trust in the community and do everything within our power so that women who come after us don’t face so much difficulty.”

Sahina Shrestha

All politics is local

<figure><a href="https://www.flickr.com/photos/26344495@N05/50981261653/in/photostream/"></a></figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022111410114/6372051f9c7e80680e0b289cjpeg.jpg" alt="" width="2048" height="1363"/><figcaption>Photo: IVAN RADIC/FLICKR</figcaption>Nepalis with battery-operated vehicles can now install a separate household meter to charge their vehicles as part of a drive by the state-owned utility to boost consumption of <a href="https://www.nepalitimes.com/banner/power-politics/" target="_blank" rel="noopener noreferrer">surplus hydro-electricity</a> from the country’s new plants.Electric vehicle (EV) owners can also opt for a larger capacity meter if the approved load for domestic use is insufficient, and the regulator is also increasing the load limit for industries, and offering additional meters for tenants on multi-storey apartments.A Nepal Electricity Authority (NEA) board of directors meeting last week decided on a slew of measures to increase consumption of electricity. Nepal is now generating 500MW more than domestic demand, and this surplus is expected to grow during the monsoon.However, due to an <a href="https://www.nepalitimes.com/banner/nepals-precious-electricity-going-waste/" target="_blank" rel="noopener noreferrer">imbalance in distribution</a> the country has to import power from India for certain areas of the country, while it sells electricity to India from other parts.“We must increase the consumption of domestically produced electricity at home to reduce spillover and wastage. That is why we are taking steps to make sure Nepalis have better access to reliable and quality power,” says Nepal Electricity Authority (NEA) chief Kulman Ghising.<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022111410114/637205229c7e80680e0b289djpeg.jpg" alt="" width="1500" height="1061"><figcaption></figcaption></figure>With the increase in popularity of <a href="https://www.nepalitimes.com/banner/fully-charged-and-ready-to-go/" target="_blank" rel="noopener noreferrer">electric vehicles</a> NEA is encouraging private companies to set up charging stations in parking lots and open spaces with the new electric meter offer. Local governments will work with the NEA to facilitate the necessary paperwork.Despite a pledge to be fully electric in its transportation sector by 2031, Nepal had yet to take a significant step or invest accordingly, even though last year it <a href="https://www.nepalitimes.com/latest/nepal-reduces-tax-on-electric-cars/" target="_blank" rel="noopener noreferrer">re-introduced a tax rebate</a> for battery-powered vehicles.After complaints that house-owners were overcharging tenants for power consumption, NEA has warned landlords that their mains will be cut if they do so. Further, it is now allowing tenants to set up their own electric meters. Those living in apartment blocks, multi-storey residential buildings and housing colonies will also be allowed to have their own meters.“Occupants of apartments can get electricity directly from the NEA with a separate meter, that way the tariff will be cheaper and the consumption will also increase,” explains Ghising, adding that factories within the same industrial complex will also be allowed separate meters.<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022111410114/637205269c7e80680e0b289ejpeg.jpg" alt="" width="3242" height="1773"><figcaption></figcaption></figure>The new regulation has also streamlined the mechanism for consumers to settle their electricity bills. They can pay in installments, through mobile apps and even customers who have been blacklisted because of their dues can arrange to pay it back in up to 12 instalments.<a style="font-size: 15px; letter-spacing: 0.01em;" href="https://www.nepalitimes.com/latest/nepal-electricity-demand-soars/" target="_blank" rel="noopener noreferrer">The NEA</a> is also providing power feeds to refrigerated storage for dairy products, cooperatives-run cold storages and drinking water and irrigation projects operated by the government or communities.The new regulation has also increased the load limit for companies from 50kV to 100kV for which the NEA will supply power via its transformers. If the companies pass the mark, they need to buy the transformer themselves.

Nepal backs EVs to boost hydro-electricity uptake

<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221110161156/636d1f909c7e80680e0af470jpeg.jpg" alt="" width="2000" height="2625"/><figcaption>Photo: AMIT MACHAMASI</figcaption></figure>On Thursday morning, Nepali Times photographer Amit Machamasi was greeted with a shocking sight when he drove up to Nagarkot to take pictures of overnight snowfall. Below him, dozens of <a href="http://archive.nepalitimes.com/news.php?id=2498#.Yc5xVy2B2t8" target="_blank" rel="noopener noreferrer">brick kilns</a> were spewing out smoke and steam into the city’s air (photo).The rain had washed down suspended particles, but the brick kilns were pumping more smoke into the air we breathe. There have been attempts to relocate brick kilns away from the densely-populated capital, but political patronage means owners are still fouling the air.After the 2015 earthquake damaged most of the Valley’s brick factories, <a href="http://archive.nepalitimes.com/article/nation/brick-factories-still-using-old-polluting-technology,2078" target="_blank" rel="noopener noreferrer">some adopted cleaner technology</a> to reduce emissions. Public pressure and urban growth then pushed most brick factories to the city’s fringes, and they are now  concentrated around Bhaktapur – most of those in the photograph are traditional dirty chimneys.After two years of forced closure during the pandemic, the brick kilns are once more working overtime to fill a backlog of demand from builders. But with politicians bogged down in power struggles, local leaders are too distracted to address the pandemic and pollution crises – both of which affect the human respiratory system.In a public opinion poll in this newspaper just before the 2017 elections, most respondents said <a href="https://www.nepalitimes.com/banner/dirty-politics-dirty-air/" target="_blank" rel="noopener noreferrer">air pollution</a> topped their list of concerns. Pollution has gotten worse since then, but it is unlikely that dirty air will figure in election speeches in 2022.“We have cleaner options like <a href="https://archive.nepalitimes.com/article/nation/earth-bricks-for-cleaner-and-healthier-kathmandu,4161" target="_blank" rel="noopener noreferrer">interlocking earth bricks</a>, so we just need public pressure to make it an election issue,” says environmentalist Bhushan Tuladhar.A pre-pandemic research showed that 40% of suspended particulates in Kathmandu’s air was from brick kilns, 30% from vehicular emissions, and 20% from open burning of trash and biomass. With the exponential increase in cars and motorcycles, the concentration of vehicular pollution at street level is now 70%.“<a style="letter-spacing: 0.01em;" href="https://www.nepalitimes.com/banner/breathing-is-hazardous-to-health/" target="_blank" rel="noopener noreferrer">Hazardous pollution levels</a> in winter have become the norm, yet the government is not doing much to control it,” says Shilshila Acharya of the Avni Centre for Sustainability. “The public should demand action from our leaders.”Although public awareness about <a href="https://www.nepalitimes.com/banner/how-weather-elevates-air-pollution-in-kathmandu/" target="_blank" rel="noopener noreferrer">air pollution</a> is at an all time high, it has not translated into action by municipalities or the federal government – even though in a democracy elections would be the way to force accountability from public officials.Says Tuladhar: “Campaigning in 2022 for elections, particularly for local government, will give us a platform to build political will to reduce air pollution. People have to be outraged, and the good news is that we have some young and educated leaders taking the lead.”In 2019, <a href="https://www.nepalitimes.com/banner/nepal-is-going-up-in-smoke/" target="_blank" rel="noopener noreferrer">air pollution</a> resulted in the deaths of 42,100 Nepalis, according to one research. Many more were indirectly affected. Vehicular emission, garbage and agricultural residue burning and brick kilns were the main sources of toxic ambient air.Besides shifting to cleaner and greener brick-making technology, controlling garbage burning, and a rapid transition to electric vehicles with government investment in electric mass transit, would be steps that would quickly improve air quality in Kathmandu.Air pollution is leading to the <a href="https://www.nepalitimes.com/latest/double-whammy-air-pollution-and-covid-19/" target="_blank" rel="noopener noreferrer">premature death of Kathmandu’s citizens</a>. It has a huge impact on the economy. The solution is political, and elected officials need to respond to the crisis.Adds Shilshila Acharya: “Politicians as always are big on promises but we demand that they first protect our health by cleaning up the air we breathe. It is a basic right guaranteed by the Constitution. Don't talk about more grandiose plans, just clean up our air first.”

Happy New Air

<figure><img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221110161152/636d1e8e9c7e80680e0af417jpeg.jpg" alt="" width="1100" height="608"/><figcaption></figcaption></figure>Household electricity consumption with the onset of winter, dedicated supply to industries and increase in electric vehicles is fuelling demand for hydropower, <a href="https://www.nepalitimes.com/banner/nepals-precious-electricity-going-waste/" target="_blank" rel="noopener noreferrer">reducing wastage</a>.This is why, despite having started exporting surplus electricity to India last month, the Nepal Electricity Authority (NEA) is now scrambling to meet a spike in domestic demand.Electricity demand is increasing in terms of both capacity (MW) and energy (units). On 13 December, the peak demand was 1,539MW, against 1,217 MW the same day last year. This difference of 322MW amounts to a 26.5% increase in peak demand. Also on 13 December, the <a href="https://www.nepalitimes.com/banner/power-politics/" target="_blank" rel="noopener noreferrer">electricity consumption in Nepal</a> was 27.2 million units, a 28.65% increase from 21.1 million units consumed on the same day last year.“The 30% increase in peak demand is a significant achievement,” said NEA Executive Director Kulman Ghising. “At the current rate, power demand could reach 2,000MW by July next year.”The government’s priority has been to reduce the ‘spill’ of electricity from <a href="https://www.nepalitimes.com/opinion/decentralising-hydropower/" target="_blank" rel="noopener noreferrer">hydropower stations</a> by increasing domestic consumption. It has focused on two areas: initiating policies to increase the use of electric appliances and providing industries with dedicated feeds. Over the last month, Ghising also visited several industrial areas to urge them to switch from diesel generators to electricity from the national grid.For this, the NEA has been working on the expansion and strengthening of transmission infrastructure as part of their short- and long-term plans. The NEA is also planning the construction of large capacity lines and substations for transmission and distribution by preemptively identifying possible places where electricity consumption may increase.The figures show that the current spike in demand is primarily due to <a href="https://www.nepalitimes.com/opinion/look-whats-cooking-in-nepal/" target="_blank" rel="noopener noreferrer">the use of electric stoves</a>, air conditioners and other household appliances and <a href="https://www.nepalitimes.com/banner/fully-charged-and-ready-to-go/" target="_blank" rel="noopener noreferrer">electric vehicles</a> in Kathmandu, where the peak demand has increased from 293MW last year to 382MW at present. Another area with higher consumption is industries. NEA signed a deal earlier in October to supply 30MW to the Hongshi cement factory in Nawalparasi.Industries previously reported experiencing 8.8 hours of power outages a week, forcing most factories to use generators, which in turn <a href="https://www.nepalitimes.com/review/post-lockdown-comeback-for-nepals-industries/" target="_blank" rel="noopener noreferrer">added to nearly 5% of their monthly expenditure</a>. The government initiative to power the industries hence would be cost-effective to the industry while also reducing wastage.To meet the current demand, the electricity grid is being supplied with 540MW from NEA's hydropower stations, 529MW from NEA's subsidiaries, 425MW from private power producers  and 25MW imported from India at peak evening hours.And yet, nearly 10% of Nepal’s population lives without electricity, most of them in Bajhang, Dolpa, Bajura, Jumla and Mugu in western Nepal which are not connected to the national grid.Experts say it is more beneficial to utilise and sell surplus power inside the country than exporting it to India. Nepal’s private industries are paying up to Rs11 per unit in electrical bills against 4.33 per unit by India.

Nepal electricity demand soars

<img src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/20221110161144/636d1d119c7e80680e0af391jpeg.jpg" alt="" width="4032" height="2268"/>T he Electricity Grid Modernisation Project that was signed between the Asian Development Bank and the Ministry of Finance in November 2020 has received an additional $60 million loan. The project which had a start in February amounts to $156 million and has been allocated to the Nepal Electricity Authority (NEA). The project aims to strengthen and modernise Nepal’s transmission capacity and electricity distribution system.

Asian Development Bank Loan received

<figure><img width="1198" height="1227" src="https://superdesk-pro-c.s3.amazonaws.com/sd-nepalitimes/2022111016114/636d13819c7e80680e0a9926jpeg.jpg" alt=""/><figcaption>Photo: BIKRAM RAI/ NEPALI TIMES ARCHIVES</figcaption></figure>Nepal could lose Rs142 billion a year in wasted surplus energy if the <a href="https://www.nepalitimes.com/editorial/just-do-it/" target="_blank" rel="noopener noreferrer">Millennium Challenge Corporation (MCC)</a> project designed to upgrade the electricity grid and highways is not endorsed by Parliament.
Nepal is currently generating 2,000MW of <a href="https://www.nepalitimes.com/editorial/manpower-and-hydropower/" target="_blank" rel="noopener noreferrer">hydroelectricity</a> with an additional 2,500MW under construction. This figure will soar to 7,300MW by 2025 as per Nepal Electricity Authority (NEA) estimates.Presently, Nepal consumes 1,500MW of electricity during the peak season, which is increasing by 20% every year. At this rate, in the next four years, the peak demand will be at 2,600MW, which means there will be an excess of 4,700MW.  
Nepal can export this surplus power to India and there are already agreements in place to facilitate trade between the two countries, but the existing Dhalkebar-Muzaffarpur cross border <a href="https://www.nepalitimes.com/latest/mcc-damned-if-we-do-damned-if-we-dont/" target="_blank" rel="noopener noreferrer">transmission line</a> can only handle 800MW each way. 
“If Nepal is unable to sell excess energy, we will be losing Rs142 billion every year. At a time when we are lagging in infrastructure, we shouldn’t stop the MCC from being approved,” says Dinesh Shrestha, chair of the Federation of Nepalese Chambers of Commerce and Industry (FNCCI).
FNCCI, Confederation of Nepalese Industries (CNI), Nepal Chamber of Commerce, Federation of Contractors’ Associations of Nepal, Independent Energy Producers’ Association and Nepal-US Chamber of Commerce and Industry have submitted a memorandum to Prime Minister Sher Bahadur Deuba urging the government to stop delaying <a href="https://www.nepalitimes.com/latest/missing-links-in-nepals-mcc-debate/" target="_blank" rel="noopener noreferrer">the five-year compact</a> and implement it soon. 
This is the private sector’s second memorandum to the government in a month. The group also states that some 7,000 Nepalis will be employed during the construction phase of the MCC, which also includes the upgrade of arterial highways to facilitate efficient transportation. The FNCCI memo comes just before the arrival in Kathmandu on Wednesday of US Assistant Secretary for South and Central Asian Affairs, Donald Lu during which he is expected to discuss the MCC ratification with Prime Minister Deuba and other party leaders.It is an indication of the importance the US attaches to the project that Deputy Assistant Secretary for South ans Central Asian Affairs Kelly Keiderling also arrives in Kathmandu on Thursday. Deuba met US President Joe Biden at the COP26 Glasgow summit two weeks ago, and revealed that he and Maoist leader Pushpa Kamal Dahal had written jointly to the US government saying the MCC would be ratified. But the project has become such a political hot potato in Nepal that Dahal quickly backtracked, clarifying that he had only said that it needed amendments before being passed. A large chunk of the US-aided $500 million grant project is set aside to build the Kathmandu-Hetauda-Butwal 400KVa transmission line which will distribute electricity from existing and new hydropower plants on the Budi Gandaki, Trisuli, Kali Gandaki, Marsyangdi, Kosi, and Tamakosi corridors, and also connect to a high-capacity line to Gorakhpur so Nepal can sell surplus monsoon electricity to India.  
In fact, in anticipation of the MCC project being completed, the NEA <a href="https://www.nepalitimes.com/latest/india-nepal-sign-power-exchange-deal/" target="_blank" rel="noopener noreferrer">signed an agreement</a> with the state-run Power Grid Corporation of India (POWERGRID) for the Butwal-Gorakhpur cross border transmission line extension two months ago in September, ahead of MCC vice president <a href="https://www.nepalitimes.com/banner/mcc-ball-in-nepals-court/" target="_blank" rel="noopener noreferrer">Fatema Z Sumar's visit to Nepal</a>.
But the MCC, the biggest grant aid Nepal has ever received has become the victim of intense power struggle and political infighting within the country. It was first weaponised to unseat K P Oli and now <a href="https://www.nepalitimes.com/latest/mcc-row-rocks-nepals-ruling-coalition/" target="_blank" rel="noopener noreferrer">threatens to split the ruling coalition</a> led by Prime Minister Sher Bahadur Deuba. 
The project is seen by the critics as part of America’s Indo-Pacific Strategy to counter China’s Belt Road Initiative. The anti-MCC rhetoric has gained such momentum that the public is convinced it supersedes Nepal’s Constitution and is anti-national, forcing even the staunch supporters from speaking in its favour.
Adds FNCCI’s Dinesh Shrestha: “The MCC is crucial for Nepal’s energy sector and <a href="https://www.nepalitimes.com/editorial/knowing-whats-good-for-nepal/" target="_blank" rel="noopener noreferrer">is to our benefit</a>. Moreover, this is a grant, not a loan. Further delaying and cancelling the compact will <a href="https://www.nepalitimes.com/latest/mcc-row-damages-nepals-credibility/" target="_blank" rel="noopener noreferrer">tarnish Nepal’s image and credibility</a> in the world community.”
MCC or no MCC, one thing is for sure. Nepal must build transmission lines and upgrade its electricity grid one way or the other so as not to waste surplus energy it is set to generate in the near future. 
Alternatively, experts say, the government must work immediately to <a href="https://www.nepalitimes.com/editorial/good-cop-bad-cop/" target="_blank" rel="noopener noreferrer">electrify transport and cooking</a> for domestic consumption of surplus power and reduce its import bill on petroleum products and LPG.

electricity