KATHMANDU, Dec 23: Nepal has secured a total investment of about Rs 72.93 billion (US$ 537 million) for the expansion, improvement, and modernization of the transmission and distribution systems to ensure reliable and quality electricity supply within the country and to expand electricity trade with neighboring countries.
The Asian Development Bank (ADB) will provide a concessional loan of USD 311 million (Rs 42.24 billion) and a grant of USD 30 million (Rs 4.7 billion) for the expansion and improvement of the electricity transmission and distribution systems. The European Union will grant USD 22.6 million (Rs 3.6 billion), and the Norwegian government will provide USD 31 million (Rs 4.21 billion) in grants. Additionally, assistance of USD 10 million (Rs 1.35 billion) will be received through the Strategic Climate Fund (SCF). The Nepali government will bear the remaining required USD 132.4 million (Rs 17.98 billion) for the implementation of the project.
The projects to be implemented through the Asian Development Bank’s (ADB) South Asia Subregional Economic Cooperation (SASEC) Electricity Transmission and Distribution Strengthening Project will mainly involve the construction of a 290-kilometer transmission line, the establishment of five new substations, and the upgrading of two existing substations.
Additionally, in the Kathmandu Valley, single-phase meters at residential customers' homes will be replaced with smart meters (Phase II), distribution substations will be modernized and automated with Supervisory Control and Data Acquisition (SCADA) systems, a national transmission line will be constructed in Karnali Province, and the distribution system will be upgraded. A concessional loan and grant agreement for the operation of the assistance was signed between the government, ADB, and Nepal Electricity Authority (NEA) last Friday. The NEA will implement the projects.
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The Managing Director (MD) of the NEA, Kulman Ghising, stated that by utilizing the resources received from development partners, the focus will primarily be shifted to improving and expanding the domestic electricity supply system, building necessary infrastructure as a backbone to make regional/sub-regional electricity trade reliable, and digitizing the distribution system.
“To address consumers' complaints about frequent power outages and to ensure a sufficient, reliable, quality, and safe electricity supply, significant funds have been raised to implement the improvement and strengthening of infrastructure projects that have been planned and initiated in previous years,” Ghising said, “Now, the projects will be implemented immediately.”
ADB's Director for Nepal, Arnaud Cauchois, mentioned that the assistance would help eliminate the limitations of the grid infrastructure in line with the growing demand for electricity within the country and support the goal of green energy export. “The assistance will be spent on key components of the transmission and distribution master plan, which will facilitate the transmission of electricity generated from hydropower projects for internal consumption and enhance cross-border electricity trade capacity,” he said, “The expansion, improvement, upgrading, and restoration of transmission and distribution infrastructure in Karnali and Lumbini provinces will help with electrification of Nepal, reduce energy poverty, and contribute to removing socio-economic disparities between the provinces.”
The assistance will be used to construct a 160-kilometer-long 400 kV double-circuit transmission line from the new Butwal Substation in Sunwal Municipality-13, Nawalparasi (Bardghat Susta West), passing through Rupandehi, Kapilvastu, and Arghakhanchi, up to Lamahi in Dang. In Lamahi, a 400 kV automated substation based on the Gas Insulated System (GIS) technology will be built. The construction of the transmission line and substation will cost $203 million.
The NEA MD Kulman Ghising, stated that the current electricity flow from Butwal to the west is through a 132 kV line. He mentioned that to meet the increasing electricity demand in the region, address the electricity flow from upcoming hydropower projects, and ensure reliable electricity trade with neighboring countries, a 400 kV line and substation will be constructed.
A 400 kV substation will be constructed in Nijgadh, Bara, under the Hetauda-Dhalkebar-Inaruwa 400 kV transmission line to provide sufficient, reliable, and quality electricity supply to industries operating, those in preparation, and future industries in the Bara-Parsa Industrial Corridor, which will demand more electricity. The 400 kV substation in Nijgadh will be built with a concessional loan from the Indian Exim Bank. An estimated $85 million from ADB will be spent on the construction of the 400 kV line from Nijgadh to Parwanipur and a 400 kV substation in Parwanipur.
A 220 kV transmission line from Okharpauwa to TinPiple and a 220 kV substation in Tinpiple are being constructed to meet the electricity demand of 3,100 megawatts in the Kathmandu Valley by 2050. The project will cost Rs 40 million.
The construction of the 132 kV transmission line from Dailekh to Jumla and a 132 kV transmission line in Jumla will cost 35 million dollars. Additionally, 23 million dollars will be spent on upgrading the electricity distribution system in the districts of Karnali Province.
