Nepal Requires Rs 6.5 Trillion to Meet 28,500 MW Hydropower Target

Nepal will require an investment of Rs 6.5 trillion to achieve the government’s target of generating 28,500 megawatts of electricity over the next decade, with Rs 4 trillion to be spent domestically. This investment is expected to significantly boost the national economy.

The announcement was made during a funding agreement ceremony for the 49.95 MW Danakhola Hydropower Project, located in Nasong Rural Municipality-2, Manang, and promoted by Lalupate Hydropower Company.

Minister for Energy, Water Resources, and Irrigation Deepak Khadka emphasized the government’s commitment to energy development through private sector collaboration. He highlighted the pivotal role of hydropower investment in advancing Nepal’s energy goals. Ganesh Karki, President of the Independent Power Producers’ Association, Nepal, noted that large-scale investment in hydropower would have a transformative impact on the national economy, particularly through the purchase of construction materials and the creation of jobs.

Nepal has achieved significant milestones in power trade, including a long-term agreement with India to export 10,000 megawatts and a deal to supply 40 megawatts to Bangladesh. Recently, a plan to export an additional 15,000 megawatts was introduced, further solidifying Nepal’s position in regional power trade.

The country currently produces approximately 2,800 megawatts of hydroelectricity, with the private sector contributing 2,100 megawatts. Over 169 hydropower projects are being developed by the private sector, with 91 of them listed on the Nepal Stock Exchange, attracting investments from more than four million individuals. Hydropower projects with a combined capacity of 3,200 megawatts are under construction, while projects totaling 3,500 megawatts are in the process of financial closure. Another 12,000 megawatts are awaiting power purchase agreements, and additional projects with a capacity of 12,000 megawatts are under study.

Studies by the Water and Energy Commission estimate Nepal’s hydroelectric potential at 120,000 megawatts, alongside 30,000 megawatts of solar power capacity. Research also indicates that electricity production during the rainy season could exceed 200,000 megawatts.

The government’s roadmap for producing 28,500 megawatts of electricity over the next decade points to a bright future for Nepal’s energy sector, with far-reaching implications for economic growth, employment, and regional cooperation.