High level meetings in Nepal

Statkraft IH managers met with high level officials during their visit to Nepal in early June. On the agenda was Khimti post 2020.

The 60 MW Khimti plant in Nepal was developed under a Build-Operate-Own-Transfer (BOOT) scheme and came into operation in July 2000, after 7 years of development and construction works. It has been a successful investment for Himal Power Ltd (HPL) and its owners Statkraft (57% through SKIHI), BKK (26%) and Butwal Power Company (17%).

The Khimti project is governed by a Project Agreement and Power Purchase Agreement (PPA) with the Nepalese state utility called Nepal Electricity Authority (NEA). The PPA expires in July 2020, when also 50% ownership is to be transferred to NEA for the value of NPR 1, according to existing agreements. The remaining 50% will be transferred back to Nepalese authorities in 2045. According to agreements, HPL alone will continue to manage, operate and maintain the Khimti plant for the full concession term, up to 2045.

A project team has recently been established to consider alternative ways forward after expiry of the existing Power Purchase Agreement for the 60 MW Khimti hydropower plant in July 2020, and to conclude a sustainable long-term solution related to Himal Power Ltd (HPL) and the Khimti plant post 2020.

EVP IH Asbjørn Grundt and SVP South Asia and Business development Tima Iyer Utne visited Nepal from 6th to 9th of June in order to meet with high level officials at NEA and the Ministry of Energy together with Statkraft’s Country Head in Nepal Sandip Shah.

Top Bahadur Rayamajhi (Deputy Prime Minister and Energy Minister) and Shyam Kumar Shrestha (Member of Parliament – Ramechhap District) joined for a visit to the Khimti plant site.

The Minister expressed satisfaction with regards to plant availability and the way the plant is operated and maintained. The Minister appreciated the quality of upkeep of the power plant, and also stated that HPL has done a lot of community development which has set a high benchmark, and that he would support HPL in the 2020 discussions with the Nepalese state utility, NEA.

He then proceeded to the Annual General Meeting of Khimti Rural Electric Cooperative (KREC) which owns two mini hydropower plants with a total capacity of 1035 kW and a rural electrification network that has electrified 9,600 households.

These mini hydros and the rural electrification network were built by HPL and transferred to a local cooperative. As the chief guest, the Minister held an address for a couple of hundred of participants where he said that the local communities should be grateful to HPL as it has done a lot for local development.