Hydropower projects require huge investment. But with the tendency to create a cycle of collusion and handing over to the companies of certain individuals to raise investment, we are trapped in the same circle.
For Nepal, water resources are not only a source of light, but also a source of prosperity. Prosperity is possible only when the state gets employment and revenue from the project. Bridges to the completion of hydropower projects can be built only when the permits, investments and contracts are transparent. Due to the tendency to stay quiet for years and hand over projects in haste, even our attractive projects are getting into controversy.
This has neither benefited the state nor encouraged investors. A country with a small budget like ours cannot do all the big projects at its own expense. Therefore, private sector investment should be welcomed to take a leap in hydropower. But the more hidden, the darker the reception, the more tumultuous and conflicted.
As a reminder of the series of disputes in the past, the process of Mugu Karnali with 1902 MW reservoir and Kimathanka Arun project with 454 MW has been advanced. It has opened the way for investigation and research rather than immediate project progress.
Both the Mugu Karnali and Kimathanka Arun projects are under the Power Generation Company Limited (VUCL) under the Ministry of Energy. In order to invite investment in these projects, the VUCL Board of Directors formed a sub-committee on December 9 to draft the 'procedures for sharing investment for project construction'.
The procedure was approved by the board on the fifth day i.e. on November 14 after the sub-committee got a week's time to work quickly. Before that, on November 7, on the same day VUCL sent the letter, Energy Minister Deepak Khadka had given policy approval through a ministerial decision based on the 'Energy Development Roadmap and Action Plan, 2081'.
While, that action plan was approved by the cabinet meeting only on December 16, after a month. How did the minister agree to the procedure based on the unapproved action plan? The first topic of research is this.
A 15-day notice was issued on December 23 to submit proposals for financial investment in both projects. Strangely, the details of the project were made public only on November 28 as the information was released in haste. However, the 15-day deadline for submitting the proposal was extended after the Abuse of Authority Investigation Commission showed interest.
This is an unusually short period of time to submit proposals for these large projects in the Far East and Far West, including site studies, technical studies and financial assessments. Variation confirms that it was a collusion with a plan to keep a certain company on standby and prevent others from coming.
It is the government's responsibility to make capital investment and construction competition as wide as possible using national resources. But it is clear that the Ministry of Energy and VUCL are trying to make the competition as narrow as possible. Only CG Energo Pvt Ltd has proposed for the Mugu Karnali project. It is the right of the CG to submit proposals for projects of its own merit and interest after the government releases the notification. However, the answer to the question of why the road was blocked so as not to allow others to come to the competition for that will be answered by the government rather than the CG.
Because every citizen and investor is equal to the government. Similarly, Kimathanka Arun Project, Nobel Group of Hydro Energy, Nepal Industries, Vision Energy and Power, NJ Hydro Energy and Anak Hydropower have received proposals from five companies.
This is not the first time, nor the last time, that the government has started giving hydropower projects to the private sector. We have enough examples of what policy to follow when giving such projects to the private sector. Earlier, it was done by making the most revenue-generating, free energy, share in the project and competing for the price of the electricity to be sold to the government.
In projects like Arun 3rd, Arun 4th, West Seti, Seti River-6, which are being built in waves below Kimathanka, the government has only agreed on the condition of getting 21.9 percent free energy. Similarly, in Upper Karnali, the government has ensured 108 megawatts of electricity and 27 percent shares for free. However, in the two projects for which proposals have been requested, it seems that the aim is only to hand over the project without setting any criteria for the share that the government will get.
Hydropower projects require huge investment. But with the tendency to create a cycle of collusion and handing over to the companies of certain individuals to raise investment, we are trapped in the same circle. The state is going to lose the benefit from this. The argument that only those who are close to power will benefit will be stronger and national self-strength will be further weakened. Therefore, in this process, the government should review itself and the abuse of authority investigation commission and the sovereign parliament should also guide the government to do so.
