PMO steps in to develop Tamor Storage HydroThe Prime Minister’s Office (PMO) is preparing to sign a pact with China Machinery Engineering Corporation to develop the Tamor Storage Hydro Project even as the Nepal Electricity Authority (NEA) is studying the scheme. The project is planned to be built on the Tamor River in eastern Nepal.
The Prime Minister’s Office (PMO) is preparing to sign a pact with China Machinery Engineering Corporation to develop the Tamor Storage Hydro Project even as the Nepal Electricity Authority (NEA) is studying the scheme. The project is planned to be built on the Tamor River in eastern Nepal.
Several weeks ago, the PMO wrote to Investment Board Nepal (IBN) asking it to make preparations to sign an accord with the Chinese company. IBN then wrote to the state-owned power utility to submit all the documents related to the project. But this has not happened, according to a highly placed source at IBN.
IBN sources said the board did not want to get involved in a project being handled by the NEA, but it was left with no option following the director order from the PMO.
The PMO’s move comes at a time when the NEA has already initiated the public procurement process to appoint a consultant to conduct a detailed feasibility study for the project. The NEA holds a survey licence for the project with an installed capacity of 200 MW, but it wants to hike the installed capacity to 762 MW and develop it. It has filed an application at the Department of Electricity Development for a survey licence with the increased installed capacity.
If the storage project is built with the increased capacity, it will inundate the 37.5 MW Kabeli-A and 21.5 MW Lower Hewa projects currently being developed on the Tamor River, and the project developer will have to compensate their owners to abandon them. The department has clearly asked the NEA to first get the consent of the two projects that face being submerged in order to qualify for the licence.
The NEA is in talks with the promoters of the two projects to wrap a deal soon. However, the letter from the PMO has left it confused over its next move, according NEA sources.
In 1985, the Japan International Cooperation Agency (Jica) had proposed building a 696 MW hydroelectric project on the Tamor River by building a 153-metre high dam. However, the government did not show much interest in the proposal at that time. Now, when the NEA management is very keen on developing the project with the increased installed capacity by paying compensation to the smaller schemes, the government has moved to award the contract to the Chinese developer.