They also said there will be no need to build transmission line as per the new project design.
“The new Q40 design enables to use more water collected during wet months to generate more energy compared to the previous Q50 design which leaves large volume of water in the river during wet months,” the officials added.
The project's installed capacity has been increased to 40 MW from 32 MW, according to Project Manager Kul Man Ghising. “The project, which was previously termed commercially unviable, has now become viable. We have proposed to the Nepal Electricity Authority (NEA) develop the project as per the company model,” added Ghising.
The 'company' model also allows NEA to launch Initial Public Offering (IPO) for general public as well as people in project affected area. This means NEA will have to invest less money compared to the previous design, say project officials.
The project redesign process was started three months ago following termination of the contract with civil contractor IVRCL Infrastructures Projects Ltd.
Construction of the project began in 2012 after a delay of nearly two years due to controversy in selection of consultant. But work progress has not remained satisfactory. NEA has paid variation order for the delay to IVRCL Infrastructures Projects Ltd - the Indian contractor for civil works. NEA terminated contract with the civil contractor after the latter started lingering works, putting demand for additional budget. The decision was upheld by NEA three months ago.
“Project cost won't go up much even after change in design. This makes the project commercially viable,” Ghising said.
The project cost will go down also as the project won't have to build a transmission line of 28 kilometer to evacuate energy to the nearest substation.
The under-construction Kaligandaki Corridor (Dana-Kushma) 220 kV transmission line goes along the project site. Construction of the transmission line is expected to be completed before the project's rescheduled commercial operation date of 2020.
Rahughat's estimated cost was US$ 72 million, according to Detailed Project Report of 2010. It has received soft loan of $31 from Exim Bank of India.
The government is investing the remaining $41 million.
The finance ministry is charging interest rate of 8 percent which is cheaper than the market rate, according to officials.
Interest rate for hydropower projects hover above 10 percent.
According to Ghising, about 60 meters of the 8-kilometer tunnel has been dug. Similarly, access roads and camp sites have already been made by the Indian contractor. The project has spent around Rs 700 million so far been.
Only Indian contractors will be eligible for the project's civil and electromechanical works as per the loan agreement signed in 2010.
Ghising also said were waiting for the consent of Exim Bank of India for design change. “We are also waiting for the generation license of 40 MW from Department of Electricity Development,” he added.
According the project's new timeline, it plans to complete re-tender and tender awarding process by the end of 2016.
The project was initially scheduled to be complete by 2014.
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