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DAM-L LS: Nepal inaugurates Khimti-I Hydro Project (fwd)



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Date: Tue, 28 Nov 2000 17:48:58 -0800 (PST)
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subject: LS: Nepal inaugurates Khimti-I Hydro Project
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His Majesty inaugurates Khimti-I
By Surendra Phuyal
Kathmandu Post
November 28, 2000

KIRNETAR, Dolakha, Nov 27 - His Majesty King Birendra formally inaugurated 
the Khimti-I  hydro-electricity project, Nepal's first private sector power 
project, here on Monday amidst the  chanting of holy text from the Veda.

Her Majesty Queen Aishwarya was also present at the function, which was 
attended by an  overwhelming number of government officials, diplomats, 
donors and energy-hungry locals of this  backwater district in the central 
hills.

Developed by Himal Power Limited (HPL), a Norwegian undertaking, the 
run-of-river hydro-electric  power generation plant has an installed 
generating capacity of 60 MW and an annual production  estimated at 350 
million kilowatt-hours (units) of electricity.

Addressing the inaugural function, Deputy Prime Minister Ram Chandra Poudel 
announced that the  government will soon introduce an investment-friendly 
water resources policy, and called on private  investors to harness the 
country's vast hydro-power potential which could later be sold out at 
an  affordable price.

The DPM's comments comes at a time when serious concerns are being raised 
on the per unit price  of electricity generated from Khimti-I project. The 
per unit price of Khimti-I is among the costliest in  the region, thanks 
largely to inflation, leakage, and difficulty of constructing projects in 
the fragile  Himalayan environment.

Speaking at the function, Norwegian Deputy Minister for International 
Development, Sigrun Mondegral  expressed happiness over the successful 
completion of the project - "first of its kind ever supported by  the 
Norwegian government," he said, adding, "the project represents something 
new: that Nepal is  slowly graduating from donor dependency."

The US $ 140 million HPL project is financed by the International Finance 
Corporation (IFC), the Asian  Development Bank (ADB), Eksportfinans a.s., 
the Norwegian Agency for Development) and the Nordic  Development Fund. The 
construction works of the project, which is also Nepal's first project 
based on  a Build-Own-Operate-Transfer (BOOT) structure, began seven years 
ago after Butwal Power Company  completed feasibility study.

Presenting his welcome speech, HPL Chairman Sverre Nygaard expressed 
happiness that the project  helped Nepal get rid of the problem of 
load-shedding and said that the project will contribute to  sustainable 
economic growth of Nepal.

HPL General Manager Harold O Skar also presented souvenirs - a statue of 
water goddess and the  national dress of Norway - to Their Majesties. The 
royal couple also observed the project's control  room, model display room 
and the underground power house.

Addressing the function, District Development Committee (DDC) Chairman of 
Dolakha, Lal Bahadur  K.C. said that the project is a big achievement for 
Dolakhalis, but expressed deep concern that the  very locals have been 
deprived of the hydro-electric power.

"That this project contributed to bring an end to load-shedding problem is 
indeed remarkable, and  hence this project remains as a landmark in the 
history of Nepal," K.C said. "But the locals have been  deprived of the 
opportunity to consume the electricity generated from their very own 
surrounding. The  locals' demand is that first priority to consume power be 
granted to them."

Although HPL is said to be working on to electrify the villages of Dolakha 
and Ramechhap districts  that are located in and around the project site, 
locals complain that neither the government nor HPL  has looked into their 
key demand - electricity supply to their houses.

HPL also operates a 500-KW mini-hydro plant, the Jhankre plant, whereby 300 
houses have been  electrified. But locals here are demanding that all the 
43 villages - 21 of Dolakha and 22 of  Ramechhap, through which the 33 KV 
transmission line of the project passes - be electrified.



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