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NEPAL: Power Sector Reform and Sustainable Hydropower Development Project

PPIAF support has been one of the important contributing factors for initiating the power sector reform process in Nepal with the overall goal of meeting the domestic electricity demand and generating electricity export revenues through private sector-led development of hydropower and other renewable energy resources. Besides supporting the overall reform process, the PPIAF grant has been accompanying the prior actions and triggers for a series of World Bank’s Development Policy Credits. Through the suite of technical assistance and advisory support, PPIAF has been able to provide clarity for the purpose, methodology, and requirement for the power sector reform and related activities in Nepal. These include increased understanding of disaster-related events in the development of hydropower projects and necessities to include such consideration in the project preparation and design; and energy sector reform as evidenced among others by the approval of electricity bill by Cabinet, the promulgation of the ERC act, and preparation of the White Paper highlighting the priority areas for the power sector development in Nepal. The activity played a substantial convening role and helped create the momentum leading to the financial close of the 216 MW Upper Trishuli-1, with IFC organizing a $453 million financing package with a $135 million political risk guarantee from MIGA, and more than $100 million in blended concessional finance from IDA-PSW.

Approved date2015-08-13
SectorEnergy
StatusClosed
Country
RegionSouth Asia
InstrumentPPIAF

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Nepal Power Sector Financial Analysis and Viability Plan