A Case Study

On
ANALYSIS OF PROBABILITY AND PRESENT SITUATION
OF HYDROELECTRICITY IN NEPAL
A Project Work Report

Submitted By:
Umesh Shrestha
TU Regd. No.:
4th Year Roll No.:
Group: Account
Shanker Dev Campus
Putalisadak, Kathmandu

Submitted To:
Office of Controller of Examination
Faculty of Management
Tribhuvan University
In Partial Fulfillment of the Requirements for the Degree of
BACHELOR OF BUSINESS STUDIES (BBS)
Kathmandu, Nepal
January, 2021

i
 DECLARATION

I hereby declare that the project work entitled "ANALYSIS OF PROBABILITY AND
PRESENT SITUATION OF HYDROELECTRICITY IN NEPAL " submitted to the Faculty
of Management, Tribhuvan University, Kathmandu is an original piece of work under the
supervision of Mr. Sailendra Kumar Basnet, faculty member, Shanker Dev Campus
Kathmandu, and is submitted in partial fulfilment of the requirements for the degree of
Bachelor of Business Studies (BBS).This project work report has not been submitted to any
other university or institution for the award of any degree or diploma.

Signature:
Name of Student: Umesh Shrestha

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 SUPERVISOR’S RECOMMENDATION

The project work report entitled " ANALYSIS OF PROBABILITY AND PRESENT
SITUATION OF HYDROELECTRICITY IN NEPAL " submitted by Umesh Shrestha of
Shanker Dev Campus Kathmandu, is prepared under my supervision and guidance as per the
procedure and format requirements laid by the Faculty of Management, Tribhuvan
University, as partial fulfilment of the requirements of the degree of Bachelor of Business
Studies (BBS). I, therefore, recommend the project work report for evaluation.

Signature:

Name of Supervisor: Mr. Sailendra Kumar Basnet

Date:

iii
 ENDORSEMENT

We hereby endorse the project work report entitled " ANALYSIS OF PROBABILITY AND
PRESENT SITUATION OF HYDROELECTRICITY IN NEPAL " submitted by Umesh
Shrestha of Shanker Dev Campus Kathmandu, in partial fulfilment of the requirements for
the degree of the Bachelor of Business Studies (BBS) for external evaluation.

Signature: Signature:
Name of Chairman: Name of Principal: Mr.
Chairman, Research Committee Campus Chief/Principal
Date: Date:

iv
 ACKNOWLEDGEMENTS

It is a great honor to thank the officials of Tribhuvan University for including the
Project work report in the syllabus of BBS fourth year. I think it is a most for the
practical development of the student.
I am extremely grateful to my respected supervisor Mr. Sailendra Kumar Basnet
for his precious guidelines, inspiration and suggestion thoroughly during the period
of this research.
I would like to thank all the teachers and library staff of Shanker Dev Campus, who
provided the reference and reading materials during the period of research.
Similarly, I am indebted to all the staff personnel of Hydroelectricity department of
Government of Nepal. for providing their valuable time and information which
assisted a lot in preparing this report.
Last but not the least, I would like to thank my family, friends and other persons
whoever have helped me in preparing this report directly or indirectly.

Thank You!

Umesh Shrestha
BBS 4th year

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 TABLE OF CONTENTS

Page No.
Title Page………………………………………………………………………………………….i
Declaration ……………………………………………………………………………………...ii
Supervisor’s Recommendation ……………………………………………………………... iii
Endorsement ………………………………………………………………………………...… iv
Acknowledgements ………………………………………………………………………….…v
Table of Contents……………………………………………………………………….......…vi
List of Tables……………………………………………………………………………….…. vii
List of Figures………………………………………………………………………………...viii

CHAPTER I: INTRODUCTION
1.1 Background of the Study………………………………………...….…1

1.2 Profile of the Organization……………………........................….…3

1.3 Objectives of the Study…………………......………………….….... 4

1.4 Rationale of the Study……………………….………………………. 4

1.5 Statement of Problem………………………….……..………….5

1.6 Review of Literature……………………………..………..………... 5

1.7 Research Methodology…………….………………………..………. 10

1.8 Limitation of the Study………………………...………………..10

1.9 Organization of Study…………………………….……………16

CHAPTER II: RESULTS AND ANALYSIS

2.1 Presentation of data in table and figure and their analysis. ……...18
2.2 Major Findings………………………………………………… …...26
CHAPTER III: SUMMARY, CONCLUSIONS AND RECOMMENDATION
3.1 Summary…………………….........................................................…28
3.2 Conclusions……………………………………………………………...29
3.3 Recommendations………………………………………………...30
BIBLIOGRAPHY

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APPENDIX

vii
 LIST OF TABLES

Titles Page No.

Table 1 Credit and Advances to Fixed Deposit Ratio ...…………………………….……19

Table 2 Credit and Advances to Total Deposit Ratio………………………….…….…... 20

Table 3 Credit and Advances to Total Assets Ratio ……………………………..….…... 22

Table 4 Total Debt to Equity Ratio …………………………………………………….….. 24

Table 5 Total Debt to Total Assets Ratio ……………………………………….…….……25

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 LIST OF FIGURES

Titles Page No.

Figure 1 Credit and Advances to Fixed Deposit Ratio .................................................20

Figure 2 Credit and Advances to Total Deposit Ratio ……….…...……………………...21

Figure 3 Credit and Advances to Total Assets Ratio …………….…………….………...23

Figure 4 Total Debt to Equity Ratio………………………………………….……...………24

Figure 5 Total Debt to Total Assets Ratio …………………………………………………26

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 CHAPTER-I
INTRODUCTION

1.1. Background of the Study

It is not a new knowledge that flowing water creates energy that can be
captured and turned into electricity called hydropower. Hydro comes from the
Greek word “Hydra” meaning water. It is the electricity produced by the
movement of fresh water from rivers and lakes. Also calls hydro power, it is a
renewable energy source dependent upon the hydro logic cycle of water, which
involves evaporation, precipitation and the flow of water due to gravity. Gravity
causes water to flow down ward and this downward motion of water contains
kinetic energy that can be converted into mechanical energy, and then from
mechanical energy into electrical energy. At a good site hydropower can generate
very cost effective electricity. The history of conversion of kinetic energy into
mechanical energy dates back to two thousands years ago in ancient Greece when
wooden water wheels were used. Hydropower represents an important source of
energy, accounting for one-fifth of the world’s electricity supply. Most of the
technically and economically feasible hydropower potential has been exploited in
the developed countries and the developing countries, too realizing the significance
of this source of power for the higher sustained economic growth and development
of their respective economics, have been embarking on the various phases.

Hydropower projects have a number of benefits. The prominent among them

are that these projects have low energy production cost considering the long
effective life time of the plants along with the low operation and maintenance cost,
greater efficiency than of all the major types of plants using non-renewable and
renewal energy resources, almost complete absence of greenhouse gas emission
and possibility of multi-purposes water use and water management such as
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irrigation and regulation of water flows both during flood season and low flow
periods independence of fluctuating fuel prices and supply disruptions, efficient
output regulation, repaid response capacity to variable energy demand, reliable,
proven mature technology with known positive and negative influences, a
renewable energy source, save consumption of fossil, fuel, or firewood which
constitute classic energy sources that contributes to the greenhouse effect or
atmospheric pollution as the hydropower plants make use of artificial falls of the
river, the hydraulic conveyance circuit that can be integrated in other components
for multiple purposes such as irrigation, water supply systems, fisheries, water-
tourism etc. The most important benefit is that hydropower plants produces
electricity without consuming power.

Hydropower has been recognized as a sustainable source of energy with

almost zero input cost. Its benefits are that it is non-polluting in the sense that it
releases no heat or noxious gasses, it has low operating and maintenance cost, its
technology offers reliable and flexible operations, and hydropower stations have
increased efficiencies along with long life. Nepal’s huge potentials in hydropower
is still untapped. Tough Nepal has not yet been able to tap even on percent of its
potential electricity capacity and 60% of Nepal’s population is still deprived of
electricity. It is fascinating to note that Nepal’s start in 1911 in hydropower
generation almost dates back to a century. As a cheap, a renewable source of
energy with negligible environment impact. Small hydropower has an important
role to play in Nepal’s future energy supply. Accordingly, micro-hydro system is
becoming increasingly popular as an energy source in rural Nepal. Use of
environmentally-friendly technologies and implementation of sound legal and
institutional issues are critical to improve the reach of the population to

11
hydropower. To make the plan targets in the power sector a reality, directing more
resources to the power projects focusing on rural population remains the pre-
requisite. The major strategies of the power sectors have been appropriately
identified as promoting rural electrification with rural economic development
programs, and strengthening power infrastructure. The immense role of the power
sector in contributing to the generation of broad-based, sustainable and high level
of economic growth as well as improving the relating competitiveness of the
economy both on a regional and global basis makes if imperative that the programs
and activities on the power sectors development as visualized in the plans and
policies be given utmost urgency, priority and focus.

1.1.1 Development of the Hydropower Energy

In the modern days, it was only in 1882 that the first hydropower plant was built in
Wisconsin, USA. This plant made use of a fast flowing river as its source. Some
years later, dams were constructed to create artificial water storage area at the

most convenient locations. These dams also controlled water follow rate to the
power station turbines. In Nepal, the first hydropower plant was established at
Pharping (500-KW) in 1911; 22years after the world’s first plant was established,
during Prime Minister Chandra Shamsher Rana’s time to meet the energy
requirements of the members of the ruling class. Though some 60 percent of
Nepal’s population remains deprived of electricity while the capital city continues
the thirst for drinking water and suffers from regular load shedding event at the
present, it is fascinating to note that Nepal has such and early start in the

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hydropower generation. The first hydropower plant in India was established in
1898 in Darjeeling and the first hydropower plant in China was established in
1912. Originally, hydropower stations were of a small sized set up at water falls in
the vicinity of towns because it was not possible at that time to transmit electrical
energy over long distance. The main reason why there has been large-scale use of
hydropower is because it can now in transmitted inexpensive over hundred of
KMs. Where it is required, making hydropower economically viable.

Transmission over long distance is carried out by means of high voltage,

overhead power lines called transmission lines. The electricity can be transmitted
as either alternating current (AC) or direct current (DC). Unlike, conventional
power stations, which take hours to start up. Hydropower stations can begin
generating electricity very quickly. This makes them particularly useful for
responding to sudden increases in demand for electricity by customers, i.e. peak
demand. Hydro stations need only a small staff to operate and maintain them. No
fuel is needed to operate, as such; fuel prices do not become a problem. Also, a
hydropower scheme uses a renewable source of energy that does not pollute the
environment. However, the construction of dams to enable hydropower generations
may cause significant environmental damages. In the world today, the highest
produced of hydropower are Canada, United State, Brazil, China, Russia and
Norway. Among the various counties Canada ranks first in the production of
hydropower as it as abundant water resources and a geography that provides many
opportunities to produce low cost energy. In fact, assessing the energy from
flowing water has played and important role in the economic role and social
development of Canada for the past three centuries.

1.1.2 Development of Hydropower in Nepal

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Nepal is rich in hydro-resources, with one of the highest per capita
hydropower potential in the world. The estimated theoretical power potential is
approximately 83,000 MW. However, the economically feasible potential has
been evaluated at approximately 43000 MW. After the establishment of the
first hydropower plant (500 MW) in 1911, the second hydropower plant (640
MW) was established at Sundarijal in 1936. Similarly, the Moraong
hydropower company established in 1939, built 677KW Sikarbas hydro plant
at Chisang Khola in 1942 though this plant was destroyed by landslide in
1960s. The development of hydropower was institutionalized after the
initiation if the development planning process. The first five years plan (1956-
61) targeted add 20 MW of hydropower.

However, the target was unmet. During the second three plans (1962-65),
some progress was achieved. Till 1962, the progress was achieved. Till 1962,
the electricity department of Nepal government was responsible for the
generation, transmission and distribution of electricity. In 1962, Nepal
Electricity Corporation was established and was given the responsibility of
transmission and distributions of the electricity. The electricity department was
responsible for the task of electricity generation. After a long gap since the
establishment of the Chisang hydro plant, the hydropower generation capacity
of the country expanded with the construction of the Panauti hydro plant (2400
KW) in 1965 and the Trisuli hydro plant (21000 KW) in 1967, a series of
hydropower projects then followed. The eastern electricity corporation was
established in 1974. In 1977, small hydropower development board was
established. Institutional restructuring tool place again in 1985. When the

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merging of the electricity department, Nepal Electricity Corporation and all the
development boards (except the Marshyangdi hydropower development board)
resulted in the creating of Nepal electricity authority (NEA). Since, this
arrangement, the NEA has been responsible for the generation transmission
and distribution of electricity. Other public sector institutions involved in the
hydropower sector include water and energy commission and its secretariat
constituted in 1976, the policy making body established in1981, and the
department of electricity development. Of late, the private sector is also
emerging as an important player in the hydropower development. Independent
power producers (IPPs) have been the ongoing institutional innovations in the
power sector of Nepal, with IPPs signing power purchase agreement (PPA)
with the NEA to sell electricity. At present, the total hydropower generation
has reached 556.8

MW or just 0.7 percent of the potential. Of the total energy consumption in

Nepal, traditional energy like fuel-would, agricultural residues and animal
dung comprises 88 percent and commercial energy like petroleum,
hydropower and solar energy constitutes 12 percent. Hydropower accounts for
75 percent of the commercial energy supply in Nepal. The hydropower plants
have mainly catered to the electricity needs in the urban and semi-urban areas.
The highest growth of hydropower took place during 2001-2005 where in
195.3 MW (35.1% of the total) was produced followed by the decades of
1981-90 and 1991-2000 decades which saw the production of 180.3 MW
(32.4% of the total) and 125.9 MW (22.6% of the total), implying that only
55.3 MW (9.9% of the total) was produced during the entire period of 1911-
1980.

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1.1.3 Small Hydro Plants in Nepal
Environmental problems with the dams such as inundation, salutation,
negative impact to river water quality, harm to riparian ecosystem,
controversies over monopoly buyer, and the fact that the large projects rely on
expensive foreign contracting forms have raised opposition against large-scale
hydropower projects in Nepal although medium to large-scale hydropower
(above 1000 KW) remains the likely choice for meeting Nepal’s urban
electricity demand. Which is growing at an average annual rate of 15 percent,
small hydropower is an attractive alternating to conventional power systems in
rural and remote areas as a means of achieving rural electrification. As only 33
percent of the population has access to electricity from the national grid, there
are many important micro-hydro schemes designed meet the rural demands.

Hence, as a cheap, renewal source of energy with negligible environmental

impacts, small hydropower has an important role to play in Nepal’s future
energy supply. Accordingly, micro-hydro system is becoming increasingly
popular as an energy source in rural areas, which are excluded from the energy
grid that transmit power from the large hydropower station to the major urban
areas. In generation, solar energy schemes and improves stoves to meet the
local need for fuel. As an example of the micro-hydropower project, the
village of Ghandruk that lies in the Annapurna region is one of the many
villages in the region that is generating electricity from the Modi Khola River.
The stream is no more than a meter wide in the dry season, but generates 50
KW of power; enough for electric lighting for every house in the village and
for 20 percent of the village to cook with electricity. The thrust of the micro
hydro projects of this nature is to develop hydropower potential in a

16
 sustainable and environmentally-friendly way, with maximum use of the
domestic resources and expertise. Of the total electricity generation, the hydro
plant (up to 1000 KW) generates 8.4 MW and medium-sized hydro plants
(above 1000KW) generate 548.4 MW, with the respective shares of 1.5
percent and 98.5 percent.

1.1.4 Hydropower Policy in Nepal

The tenth plan’s key objectives in the power sector include expanding, in a
sustainable and environmental-friendly manner, electricity coverage by
generating low-cost power accelerating rural electrification to promote
economic growth and improve living standards, and to develop hydropower as
an important export item. Rural electrification is particularly important in a
rural-based economy of Nepal. It plays an important role in accelerating both
agricultural and rural development. It could have a catalytic effect on
agricultural growth, especially by accelerating shallow tube well irrigation. In
addition to supporting the development of agro business. The extension of
rural electrification would also help modernize cottage industries and improve
the living standards of rural households. Accordingly, key programs are aimed
at expanding grid-based rural electrification. Promoting small projects where
grid-based expansion is not possible, and enhancing the capacity of
cooperatives for management at local levels. To achieve the objective of
increasing rural coverage of electricity over the plan period, the government’s
strategy envisages initiating an explicit subsidy policy for grid-based rural
electrification.

Water resources strategy 2002 has formulated 10 different strategies, out of

which the strategy for the hydropower development aims to achieve “Cost-
17
effective hydropower development in a sustainable manner”. The strategy has
prescribed short –term (5 years), medium-term (15 years) and long-term (25
years) strategic plan of hydropower development. The target of the strategy is
(a) by 2007, to develop hydropower capacity to meet projected demand of 700
MW, (b) by 2010 laws making national contractors/consultants participation
mandatory in all types of projects promulgated, (c) by 2017, 25 percent of
households supplied with electricity, (d) by 2017, 2230 MW hydropower
developed to meet projected demand including 400 MW for export, (e) by
2017 38 percent of households supplied with electricity, (g) by 2027 60
percent of households accessing the grid-supplied electricity, and (h) by 2017,
Nepal exporting substantial amount of electricity.

The major strategies of the power include promoting private sector

participating in power generation and distribution, unbundling the activities of
the NEA as well as improving its financial viability, integration rural
electrification with rural economic development programs, and strengthening
power infrastructure. The major initiatives/activities to be undertaken to
improve power sector development include the establishment of a Power
Development Fund (PDF), creation of an independent regularity authority;
initiation of an explicit subsidy policy for grid-based rural electrification; and
promotion of small, medium, and storage hydropower projects. Hydropower
policy has been accordingly revised to allow the private sector entry into a full
range of power sector activities, i.e., generation, transmission and distribution.
Considerable private investments have already taken place in a number of
power generation projects. But progress has been constrained by the insecurity
caused by the civil disorder. The major outcomes expected are that the
proportion of population having access to electricity will increase from 40

18
 percent to 55 percent by the end of the Tenth Plan period, as stated above, and
adequate power will be supplied as needed to support economic growth. To
make this outcome a reality, directing more resources to the power projects
focusing on rural population remains the pre-requisite.

In accordance with the priority accorded to this sector, HMG has spent
substantial sums of money for the electricity development in Nepal. The actual
capital outlays on electricity during FY 1998/99 through FY 2003/04 are: Rs.2.3
billion in FY 2004/05, Rs.2.2 billion in FY 2005/06.Rs. 2.8 billion in FY
2006/07, Rs.2.5 billion FY 2007/08 and Rs.2.2 billion in FY 2007/08, and 2.3
billion in FY 2008/09, representing 20.9 percent, 21.6 percent, 23.7 percent,
17.6 percent, 17.4 percent and 20.6 percent of the total capital outlay of HMG
during these six years respectively. The average of these components works out
at 20.4 percent. The public statement on income and expenditure of HMG for
FY 2009/10 has termed roads, electricity and communications as the
prerequisite for economic growth.

Accordingly, important programs have been outlined for the electricity

development. To expedite the construction of the Middle Marshyangdi Hydro
Project, Rs.2.8 billion has been allocated. Rs.1.5 billion has been allocated for
the rural electrification program which includes handing over the electricity
distribution responsibility to the consumer groups in 100 places. There is also a
program to generate 2.075 KW electricity in different districts not accessed by
the national grid. Necessary preparation will be made to initiate the construction
of 302 MW upper Tamakoshi and 42-MW Upper Modi “A” under the joint

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 investment of NEA will issue power bonds with maturity period of 20 to 30
years and invest them for the construction of new projects.

The immense role of the power sector in contributing to the generation of board-
based, sustainable and high level of economic growth makes it imperative that
the programs and activities on power sector development as visualized in the
plans, policies and the annual public statement on income and expenditure of
HMG be given the utmost urgency, priority and focus. The programs of NEA
also need to be completed timely and efficiently. It is very important to realize
that, in the present global scenario where the oil prices are remaining higher and
future provides an uncertain outlook with respect to oil, optimal utilization of
the abundant natural endowment; hydropower would reduce Nepal’s import cost
substantially and contribute to improve the relative competitiveness of the
economy both on a regional and global basis.

1.1.5 Operations of Hydropower Stations

The most common type of hydropower plant uses a dam on a river to store
water in a reservoir. Water released from the reservoir flows through a turbine,
spinning it, which, in turn, activates a generator to produce electricity. But
hydropower doesn’t necessarily require a large dam. Some hydropower plants just
use a small canal to channel the river water through a turbine. Another type of
hydropower grid into the electric plant-can even store power. The power is sent
from a power grid into the electric generators. The government then spins the

20
turbines backward, which causes the turbines to pump water from a river or lower
reservoir to an upper reservoir, where the power is stored. To use the power, the
water is released from upper reservoir back down into the river or lower reservoir.
This spins the turbines forward, activating the generators to produce electricity.

Thus, the main components of a hydropower facility are the dam, the
powerhouse that contains the mechanical and electrical equipment, and the
waterways. Water is released from the dam to turn turbines. The turbines drive
generators that produce electricity. The purpose of the dam is to create height fro
the water to fall and to provide storage. However, the dam must also be provided
with a spillway that can accommodate and pass high flows of flood waters without
overtopping the dam or reducing its safety. The flood water comes from heavy rain
or rapid snowmelt on the upstream part of the basin. If it is proposed to utilize not
only the head at the dam but also the fall in the river downstream, a canal, penstock
or tunnel are needed to carry the water to the powerhouse. A canal may also be
needed to carry water from the powerhouse back to the river.

The amount of electrical energy that can be generated from a water source
depends primarily on two things: the distance the water has to fall and the quantity
of water flowing. Hydropower stations are therefore, situated where they can take
advantage of greatest fall of a large quantity of water: at the bottom of deep and
steep-sided valley or gorge, or near the base of a dam. Water is collected and
stored in the dam above the station for use when it is required. Some dams create
big reservoirs to store water by raising the levels of rivers to increase their
capacity. Other dams simply arrest the flow of rivers and divert the water down to
the power station through pipelines. The amount of energy available from the
21
water is above the turbine. The greater the height (or head) of the water above the
turbine, the more energy each cubic meter of water can impart to spin a turbine
which, in turn, drives a generator. The greater the quantity of water, the greater the
number and size of turbine that may be spun, and the greater the power output of
the generators.

It may be relevant to mention that current hydropower technology, while

essentially emission-free, can have undesirable environmental effects, such as
fish injury and mortality from passage through turbines, as well as detrimental
effects on quality of downstream water. A variety of mitigation techniques are
in use now, and environmentally friendly turbines are under development.

1.2 Objectives of Study

The main objective of the study is to fulfil the partial examination of BBS
4th year. And others are follows:

1) To analyse the current situation of hydropower in Nepal.

2) To analyse the problems related with the hydropower.

3) To analyse the challenges in hydropower field.

4) To understand the hydropower policy of Nepal.
5) To know about the contribution of hydropower to the greenhouse effects of
atmospheric pollution problems.
1.3 Rational of Study
These are the importance of the study The Historical Development of Hydropower
and its Policy in Hydropower Nepal Historical

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 1) To identify the historical development of hydropower in Nepal.
2) To identify the current position of hydropower in Nepal
3) To identify the Hydropower policy in Nepal.

1.4 Statement of Problem

Nepal has high potential for hydropower due to glaciers in the Himalayas, regular
monsoon rain and local topography. Himalayan Rivers contain large quantities of
sediment with hard abrasive particles, which is a hurdle for the economic exploitation of
hydropower resources. Erosion of the earth's surface takes place because of influence of
climatic, tectonic and human activities. Almost all the power plants in the Himalayan
region are affected by excessive sediment in rivers that reduce the life of plants either by
filling reservoirs or by erosion of turbine components. The design and operation of
headwork components in hydropower plants can only manipulate sediment particle size
and hence only sediment concentration in the water. The erosion of hydraulic machinery
depends on eroding particles, that is, their size, shape and hardness; on substrates, their
chemistry, elastic properties, surface hardness and surface morphology; and on operating
conditions, velocity, impingement angle and concentration. The shape, size and mineral
content of sediment vary at different locations of the same river system depending on
distance traversed by particles, gradient of the river and the geological formation of the
river course and catchment areas.

The Khimti hydropower project in Nepal represents a typical high head power plant in
the Himalayan River that is affected by river sediment. Erosion tests of turbine material
carried out at Kathmandu University revealed the dependence of erosion rate on mineral
content. The erosion tests have shown trends relative to the quartz content present in
samples from river basins in different parts of the country. There was some indication
that the shape of particles had some effect. Sediments in the hydropower projects are
normally considered as a burden, but there is scope for industrial use of these sediments.

1.6 Review of Literature

Review of literature means reviewing research studies which include the current knowledge
including substantive findings, as well as theoretical and methodological contributions to a
particular topic. It is also the study of other relevant proposition in the related area of the study so
that all the past and previous studies, their conclusion and perspective of deficiency may be

23
known and further research can be conducted or done. Literature reviews are secondary sources,
and do not report new or original experimental work. It is an integral mandatory process in
research works. It is a crucial part of all dissertations. In other words, it's just like fact finding
based on sound theoretical framework oriented towards discovery of relationship guided by
experience, resonating and empirical investigation. The primary purpose of literature review is to
learn which helps researcher to find out what research studies have been conducted in one's
chosen field of study, and what remains to be done. For review study, the researcher uses different
books and journals, reviews and abstract, indexes, reports and dissertation or research studies
published by various institutions, encyclopedia etc.

We study the review of literature dividing two headings:

i. Conceptual Review
ii. Empirical Review

1.6.1 Conceptual Review

One-fifth of the global electricity supply comes from hydropower, and hydropower development
has promoted and helped shape economic growth in many countries such as Bhutan, Canada,
Norway, and the United States (World Bank 2009). Hydropower can play an important role to
address growing demand worldwide for clean, reliable, and affordable energy. Moreover, properly
designed and implemented multipurpose water infrastructure projects also offer other development
opportunities such as irrigation, fisheries, and domestic and industrial water supply for developing
nations (World Bank  2009; Billington and Jackson 2006; ICOLD 2010). Hydropower avoids use
of carbon-intensive energy sources such as coal, oil, and gas, and also helps integration of other
intermittent renewable energybased power generation sources such as solar and wind power into
the main grid, moving the economies toward a low-carbon development path. However,
hydropower projects are complex and are often associated with serious economic, social, and
environmental risks. These risks are often cited by those opposed to large-scale hydropower
projects by stakeholders such as civil society organizations, communities, donor agencies, and
governments in developed countries. The Report of the World Commission on Dams (WCD 2000)
was a milestone in terms of growing opposition to large dam projects. While acknowledging the
benefits of large dams, the WCD report highlighted that in too many cases, an unacceptable and
often unnecessary environmental and social costs have been incurred in securing such benefits.
Findings of this report have had a major impact on hydropower development; many development

24
financing institutions hesitated supporting hydropower development for about a decade. A World
Bank report titled “Directions in Hydropower” (World Bank 2009) is indicative of changes taking
place on this trend. The report argues that lessons from the past, together with emerging global
energy trends, call for a renewed role for hydropower in global energy developments. Thus, there
is a renewed interest in hydropower development among major stakeholders, but the debate on its
costs and benefits continues. For example, Ansar et al. (2014) claim that cost estimates of past
hydropower projects have been systematically below actual costs as they have not properly
incorporated inflation, debt servicing, and environmental and social costs of large dams. The
article also predicts time and cost overruns of future large dams. It concludes that in many
countries large hydropower dams are too costly to build to deliver positive risk-adjusted returns
unless suitable risk management measures are imbedded in project designs. Despite the fact that
whether time and cost overruns are unique to hydropower or common to all the large civil work
projects remains an interesting research question, Ansar et al. (2014) cast doubts in the minds of
policy makers about hydropower. This paper contributes to the ongoing debate on hydropower,
taking on Nepal as a case study. It uses a general equilibrium model to study the economic and
environmental impacts of Nepal’s hydropower development options over 2 decades. This model
takes into account electricity export opportunities to neighboring countries considering
conventional energy price risks. Its sensitivity analysis, which uses the Monte Carlo framework,
demonstrates that Nepal can significantly stimulate economic growth within plausible scenarios of
oil price changes and investment strategy, through national and international joint venture
development of its hydropower potential. In the long run, hydropower generation expansion,
together with the necessary transmission infrastructure development, will significantly increase
national income and make, domestic energy cheaper. It also reduces poverty more effectively than
electricity subsidies. Moreover, this study shows that Nepal has a potential to significantly
contribute in providing environmental services to the South Asian region, by delivering clean,
renewable energy and by climate change mitigation
1.6.2 Empirical Review
The energy sector plays a very important role in economic development and evidence shows that
expanding the electricity sector contributes to economic growth in many countries. The
underperforming electricity sector in Nepal, with inadequate and unreliable supply of poor-quality
electricity, was a major development constraint. This situation has been improving, but even today
basic energy needs of Nepali citizens are only being met partially. The energy sector is still
dominated by traditional sources, where fuel wood accounts for over three-quarters of total energy
consumption. Nepal has no known oil or gas resources and all fossils fuels are imported. As of

25
2019, about 89% of the population has access to electricity, but the supply is of poor quality and
unreliable. Despite the dramatic increase in per capita electricity consumption, from 63 kilowatt-
hours (kWh) per annum in 2000 to 177 kWh per annum in 2018, it remains among the lowest in
the world; Nepal’s per capita electricity consumption is onetwentieth of the global average.
Nepal’s economic growth was less than 4% per annum during the 2000s. This slow growth is
partially attributed to shortages in the supply of electricity for both traditional and modern
industries. This situation has been changing, as it recorded about 6% growth in 2013 and about
7.3% growth on average from 2016 to 2018, after a significant slowdown in 2014 and 2015
mainly resulting from the impacts of the earthquake. Specifically, contribution from both the
agricultural and industrial sectors to the gross domestic product (GDP) has decreased in the past 2
decades. While the relative contribution from the agricultural and industrial sectors declined, the
services sector has grown and currently accounts for the largest share of Nepal’s economy. In
2017, services accounted for 51.6% of GDP, followed by agriculture (26.2%) and industry
(13.4%). It is believed that the recent improvements in electricity supply to the industrial and
service sectors have contributed to better economic growth. This trend in electricity sector growth
is expected to continue along with rapid urbanization and a growing number of energy-intensive
industries. The unconstrained demand for electricity is expected to increase from an estimated
10,138 gigawatt-hours (GWh) in 2019–2020 to 31,196 GWh in 2029–2030 (Nepal 2019). The
total installed generation capacity in Nepal is only 1,182 megawatts (MW) against a peak
electricity demand of 1,320 MW in fiscal year 2018–2019. Of this, the Nepal Electricity Authority
(NEA) owned 621 MW (generating 34% of total sold electricity) while private investors owned
560 MW of the total installed capacity (generating 29% of total sold electricity). The remaining
requirements were satisfied by importing electricity from India (38% of total electricity sale,
maximum import of about 596 MW). Electricity generation capacity in Nepal is rapidly
increasing. In terms of the recent progress in hydropower development, survey licenses for 302
projects with a total capacity of 15,885 MW have been already issued, out of which 172 projects
have secured generation licenses and construction is ongoing for total capacity of 4,642 MW.
Power purchase agreements have been completed for 244 projects with total capacity of 4,138
MW.

26
 1.6.2.1 Review of Journal, Reports, Books and Articles
Energy procedia- 2017 Power generation using hydro resources offers sustainable, zero
energy input cost, zero greenhouse gas emission, low operating and maintenance cost
alternative to fossil fuel based power generation. Currently, nearly 17% of the world's
total power generation is based on hydro resources and its share to renewable power
generation is 70%. Although hydropower is produced in 150 countries, Nepal's
economically feasible hydropower generation capacity is one of the highest. However,
this huge hydropower potential is still untapped. By harnessing the hydro resources
Nepal can meet its domestic demand, create a surplus for export and generate
employment for its citizens. This paper reviews Nepal's current hydropower resources,
projects, future plan and their impact on the economy.

Clarion energy media Nepal has huge potential for hydropower development. The rough
estimate of the potential is more than 80,000 MW. However, the installed hydro capacity as of
2018 is less than 1,000 MW.

Nepal Electricity Authority (NEA), a government entity, owns and operates the national grid.
About 60% of the 30 million people living in the country have access to electricity. The rest of
the population still relies on primitive methods of lighting, such as kerosene lamps. The supply
of electricity, however, relies heavily on imports from India, mainly during the winter when the
river flows become very low.

1st International Conference on Energy and Power, ICEP2016, 14-16 December 2016, RMIT
University, Melbourne, Australia Power generation using hydro resources offers sustainable,
zero energy input cost, zero greenhouse gas emission, low operating and maintenance cost
alternative to fossil fuel based power generation. Currently, nearly 17% of the world’s total
power generation is based on hydro resources and its share to renewable power generation is
70%. Although hydropower is produced in 150 countries, Nepal’s economically feasible
hydropower generation capacity is one of the highest. However, this huge hydropower potential
is still untapped. By harnessing the hydro resources Nepal can meet its domestic demand, create
a surplus for export and generate employment for its citizens. This paper reviews Nepal’s current
hydropower resources, projects, future plan and their impact on the economy.

1.6.3 Research Gap

A literature gap, or research gap, is an unexplored topic revealed during a literature search that has
scope for research or further exploration. The review of above literature has contributed to the
fundamental understanding and knowledge, which is required to make this study meaningful and
purposeful. The past researcher in measuring credit management of bank have focused on the
limit ratio which are incapable of solving the problems. Actually, credit management is

27
 determined by various factors. In this research various ratios are systematically analyzed and
generalized. Past researcher has not properly analyzed about lending and its impact on the
profitability. In this research all ratios are categorized according to their area and nature.

1.7 Research Methodology

Research and study are very important and complex work. They gives us
required information what we need and help us to reach in conclusions which make
possible by field study:-questionnaires, observations, unstructured interviews and
structured interviews. This study is also based on primary and secondary data. The
data play an important role in this research. For the data that cannot be obtained
through field study, they have been obtained from related organization’s report
related magazine and relevant articles in newspapers and relevant websites. The
researcher has tried to describe and analyse the data as far as possible.

Research methodology refers to the various sequential steps adopted by the

researches in the study. For preparing this report “NEA publications” and “Annual

Report of National Planning Commission” was economic rewire of Nepal Rastra

Bank are summarized. After this their data are analyzed and interpret the various
electricity measurement tools.

1.7.1 Research Design

A research design is an overall framework or plan for the collection and analysis of data. The
research design serves as framework for the study, guiding the collection and analysis of the data.
Design sets up the framework for adequate tests of the reactions among variables. It tells us about,
what observations to make, how to make them and how to analyze the quantitative representation
of the observation. Specifically, research deign describes the general plan for collecting, analyzing
and evaluating data after identifying.

28
 The present study follows the descriptive as well as analytical design to meet the stated objective
of the study. The importance of the research is to analyze Present situation of hydroelectricity in
Nepal. In relation to credit disbursement and recovery as well as overall management. This
research followed descriptive research design.

1.7.2 Nature and Sources of Data

The source of data collection is basically secondary and the research is based on secondary
sources of data.

 Primary data:

The data which are originally collected by an investigator or an agent for

the first time for the purpose of statistical enquiry are known as primary data.
Primary data are the data collected by face to face interview or question airy
with the concern staff of Nepal Electricity Authority by the researcher.

 1.7.2.1 Secondary data:

Use of data, which is collected by, second person of the data id prepared by
second person, is called secondary data. In another word the data, which are
initially collected by someone but obtained from published or unpublished sources,
are called secondary data. Due to lack of time and proper feasible investigation the
primary data are limited to certain extent only.

These data has been collected form the office ‘Nepal Electricity Authority’.
In this field work almost secondary data are used. National Planning Commission

29
report, NEA report NRB economic review and other publication are the man
sources of the data.

The secondary data sued on the research work are as follows:

1) The staffs of ‘Nepal Electricity Authority’

2) The books published by ‘Nepal Electricity Authority’
3) Brochures published by difference related organizations.

1.7.3 Population and Sample

In Nepal, there are 20 Hydropower project development in Nepal to watch

in 2020. (www. beltandroad.news.com) which are considered as population
of this study. Out of them upper Tamakoshi Hydropower project is taken as
sample for project work by following convenience sampling method.

1.7.4 Data Collection Procedure

 Data collection procedure includes different method applied to collect data.
All research involves the collection and analysis of data, whether through
reading, observation, asking question or a combination of these or other
strategies. The data collection during and for research may, however vary in
their characteristics.
 Notices published in newspapers, articles.
 NRB published books, reports and bulletin
 Annual reports and statement of Nepal Governement

30
 Webpage of Hydroelectricity department
 Information given by department staffs.

1.7.5 Data Analysis Tools

For the purpose of the study, all data collected are arranged, tabulated under various heads and
then after statistical analysis have been carried out to enlighten the study. Mainly financial
methods are applied for the purpose of the study. Appropriate statistical tools are used. To make
the study more specific and reliable, two types of tools are used for analysis:

A. Financial Tools
B. Statistical Tools

A. Financial tools:

Financial tools are those, which are used for the analysis and interpretation of financial data.
These tools can be used to get the precise knowledge of a business, which in turn, are fruitful in
exploring the strengths and weaknesses of the financial policies and strategies. For the sake of
analysis following various financial tools have been used in order to meet the purpose of the
study. Here, Credit Deposit (CD) ratio has been used in this study.

Mathematically,

CD Ratio = (Total Loan/ Total Deposit) *100%

B. Statistical tools:

Being the quantitative research, the collected data are analyzed with MS Excel. Almost all the
collected data of this research have been analyzed descriptively with frequency and percentage
and chi-square test for testing hypothesis. The information collected through websites are
transferred into quantitative data sheet and then the necessary tabulation is done using Microsoft
excel. Statistical tools provided in Microsoft excel to make bar chart. In this way various
statistical tools have been used for statistical analysis in this project.

31
For supporting the study, statistical tools such as Mean, Standard Deviation, Coefficient of
Variation, Correlation and diagrammatic cum pictorial tools have been used.

Tabulation Method: 

Generally, the tables are classified in two ways.

According to purpose:

a)  Reference table: It is big and has large data and general in nature.

b)  Summary table: It contains data, which may be useful for the study of particular problem and
specific in nature.

According to character:

a)  Simple table: It provides information about only one characteristic of the particular data.

b)  Complex table: The data are classified with respect to two or more inter-related
characteristics.

Pie chart and trend line

Charts:

The chart is used to show the range of variation in the values.

Pie-chart: It divides the data into several parts into which it is broken up form of circle and the
divided sectors that each represent a proportion of the whole. It is called pie-chart because it
looks like slices of a pie.

Percentage and Average

A percentage is a number or ratio expressed as a fraction of 100. It is often denoted using

the percent sign, "%". A percentage is a dimensionless number (pure number).

Arithmetic Mean

The arithmetic mean (or mean or average) is the most commonly used and readily understood
measure of central tendency. The arithmetic mean is defined as being equal to the sum of the
numerical values of each and every observation divided by the total number of observations.

32
Arithmetic mean represents the entire data by a single value. It provides the gist and gives the
birds' eye view of the huge mass of a widely numerical data. It is calculated as:

n
1
X= ∑X
n i=1 i

Where:

X = mean volume or arithmetic mean

∑ X i = sum of the observation

i=1

n = number of observations

 An average is the sum of a list of numbers divided by the number of numbers in the list. Most of
the time, this is used in finding a number. In mathematics and statistics, this would be called
the arithmetic mean. In statistics, mean, median, and mode are all known as measures of central
tendency.

Correlation coefficient

It is a statistical tool for measuring the intensity or the magnitude of the linear relationship
between two series. Karl Pearson's measure known as Pearson's correlation coefficient between
two variable and series X and Y is usually denoted by 'r' and can be obtained.

The Karl Pearson Coefficient of correlation always falls between -1 and 1. The value of
correlation in minus signifies the negative correlation and in plus signifies the positive
correlation. As the value of correlation reaches to zero, it is said there is no significant
relationship between the variables.

The coefficient of variation measures the relative measure of dispersion, hence capable to
compare two variables independently in terms of variability.

σ
C.V. = × 100
x

σ = Standard Deviation

33
 x = sum of the observation

1.8 Limitation of the Study

The limitations are as follows:

 The study is mostly based on the published Hydropower statement of NEA

& NEC along with other related journals, magazines, bulletins, textbooks
etc.
 The data collected for the report does not contain deep and detail analysis of
NEA & NEC because of the limitation of the resources.
 This study is only emphasized on Historical development of Hydropower in
Nepal.
 The study includes the data of 95 years i.e. from 1910-2005.

1.9 Organization of the Study

The study has been organized mainly into three chapters;

Chapter I: Introduction: includes brief description about the Hydropower project and, statement
of problem, objectives of the study, rationale of the study, Literature review, the research gap,
methodology and limitation of the Study.

Chapter II: Presentation and analysis: research design or approach (quantitative or qualitative);
population and/or sample; collection and tabulation of data; and data analysis procedures;
financial analysis; and major findings. Further, it also includes the ways of presentation of those
relevant data and analyzes them in terms of ratio so as to ease the task of evaluation. Finally, it
consists of major findings or the result.

34
 Chapter III: Summary and Conclusion: Presentation of results and findings of project work.
Discussion and Conclusion: Evaluating and interpreting the implications results obtained.

CHAPTER II

DATA PRESENTATION AND ANALYSIS

2.1 Presentation and Analysis of Data

This chapter is generally concern to the analysis of different matters of NEA by tables and charts. The
figures of data are in of approximate in megawatt. For the purpose of analysis the simple method of
statistical tools are used.

2.2 Decade Wise Development of Hydropower in Nepal

Table No. 2.1

Decade wise Development of Hydropower

Generation Cumulative

Decade Mega watts % of total Mega watts % of total

1911-1920 0.5 0.1 0.5 0.1

1921-1930 0.0 0.0 0.5 0.1

1931-1940 0.6 0.1 1.1 0.2

35
 1941-1950 0.0 0.0 1.1 0.2

1951-1960 0.0 0.0 1.1 0.2

1961-1970 27.5 4.9 28.6 5.1

1971-1980 26.7 4.8 55.3 9.9

1981-1990 180.3 32.4 235.7 42.3

1991-2000 125.9 22.6 361.5 64.9

2001-2009 195.3 35.1 556.8 100

2010-2019

Source: compilation from NEA publications.

In the above table no. 1 decode represent the every 10 year’s development of the hydropower
Second column ‘Generation’ indicates the production of hydropower at that decade and Third column
‘Cumulative’ indicate the total production of hydropower up to the last date of the decade NEA produced
556.8 MW electricity up to the date of 2010.

2.2.1 Decade Wise Development of Hydropower Generation in

Percentage of Total

Figure No. 2.1

36
 Decade wise Development of
Hydropower Generation

40
35
30
Percentage

25
20 %of to-
15 tal
10
5
0
1911- 1921- 1931- 1941- 1951- 1961- 1971- 1981- 1991- 2001-
1920 1930 1940 1950 1960 1970 1980 1990 2000 2009

Decade

In figure no. 1 the development of Hydropower in decade 1911 to 1920 it is only 0.1% of total
hydropower generate up to the date of 2008 i.e. 556.8 MW. Similarly in other decade 0%, 0.1%, 0%,
4.9%, 4.8%, 32.4%, 22.6%, 35.1% respectively. From this figure it can say that the generation of
hydropower is just run from the decade 1961 to 1970.

2.2.2 Decade Wise Development of Hydropower Generation in MW

in Nepal

Figure No. 2.2

37
 Decade wise Development of Hydropower
Generation (MW)

195.3
200 180.3
180
160
140 126.9

120
100
Mega watt

Mega Watt
80 (MW)

60
40 27.5
26.7
20
0.5 0 0.6 0 0
0
1911- 1921- 1931- 1941- 1951- 1961- 1971- 1981- 1991- 2001-
1920 1930 1940 1950 1960 1970 1980 1990 2000 2009

Decade

From the figure no. 2 it seems that 0.5 MW in decade 1911 to 1920 and in
upcoming decade 0MW, 6MW, 0MW, 27.5MW, 26.7MW, 180.3MW, 126.9MW,
195.3MW respectively.

2.2.3 Decade Wise Cumulative Hydropower Development in MW in

Nepal
Figure No. 2.3

38
 Dedadewise Cumulative Hydropower
Development(MW)

600 556.8

500

400 361.5
Mega watts

300 Mega Watt

235.7
200

100 55.3
28.6
0.5 0.5 1.1 1.1 1.1
0
1911- 1921- 1931- 1941- 1951- 1961- 1971- 1981- 1991- 2001-
1920 1930 1940 1950 1960 1970 1980 1990 2000 2009

Decade

The figure no. 3 shows the total generation of hydropower up to that decade
in MW until the decade of 1961 to 1970 the generation of hydropower is very low.
From the decade 1961 to 1970 it is raising up.

2.2.4 Decade Wise Total Percentage to Cumulative Hydropower

Development

Figure No. 2.4

39
 Decade wise Cumulative Hydro Power Development(% of Total)

120

100
100
Percentage of Total

80
64.9
60 Total of %

42.3
40

20
9.9
5.1
0.1 0.1 0.2 0.2 0.2
0 0
1911- 1921- 1931- 1941- 1951- 1961- 1971- 1981- 1991- 2001-
1920 1930 1940 1950 1960 1970 1980 1990 2000 2009

Decade

Figure no. 4 shows the total percentage of hydropower generation in

different decade 1911 to 1920 to half decade of 2001-2009

2.4 Peaking Capacity in Summer and Winter of Various Hydro

Generating Station
Table No. 2.5

Summer and Winter Peaking Capacity

S.N Generating Types Units Installed Summer Winter

40
 Station no/size Capacity Peaking
MW
MW Capacity(MW Peaking
)
Capacity(MW)
1 Kaligandaki-A Hydro 3 x 48 144 144 144
2 Marsyangdi Hydro 3 x 23 69 65 69
3 Kulekhani-1 Hydro 2 x 30 60 60 60
4 Kulekhani-2 Hydro 2 x 16 32 30 30
5 Trishuli Hydro 6 x 3.5 24 21 21
1x3
6 Devighat Hydro 3 x 4.7 14.1 14 14
7 Sunkoshi Hydro 3 x 3.35 10.05 9 9
8 Gangaki Hydro 3x5 15 5 5
9 Jhimruk Hydro 3x4 12 12 12
10 Andhiklola Hydro 3 x 1.7 5.1 5 5
11 Panauti Hydro 3 x 0.8 2.4 1 1
12 Seti Hydro 3 x 0.5 1.5 1 1
13 Phewa Hydro 4 x 0.47 1.08 0.6 0.6
14 Sundarijal Hydro 2 x 0.32 0.64 0.64 0.64
15 Pharping(not in Hydro 1 x 0.5 0.5
operation)
16 Tinau Hydro 2 x 0.25 1 0.52 0.52
1 x 0.5

17 Tatopani Hydro 8 x 0.25 2

18 Jupra Hydro
19 Puwa Hydro 2 x 3.1 6.2 6.2 3.1
20 Modi Hydro 2 x 7.4 14.8 14 14
21 Khimti Hydro 5 x 12 60 60 36
22 Bhotekoshi Hydro 2 x 18 36 36 21
23 Indrawati Hydro 3 x 2.5 7.5 6 3
24 Chilime Hydro 2 x 10 20 20 15

41
 Source: NEA

The above table no. 3 shows the peaking capacity of summer and winter
with installed capacity in MW. Although some station has equal production
capacity in winter and summer but some has different such as Marsyandi, puwa,
Khimti, Bhotekoshi, Indrowoti, Chilime station etc have some different in
production.

2.4.1 Multiple Bar Diagram of Summer and Winter

PeakingCapacity

Figure No.2.5

Diagram of Summer and Winter Peaking Capacity

42
 80

60
summer
Mega watts

40
winter
20

0
d i a ti h i
a ti e
n w im s im
y a Pu Kh eko raw hil
a rs o t n d C
M h I
B

Generating Stations

The above figure no.5 shows the peaking capacity of summer and winter with
installed capacity in Megawatts. Some stations (Marsyandi, Puwa, Khimti,
Bhotekoshi, Indrawoti, Chilime) have different in production in summer and
winter.

2.5 Distribution of Small Hydro Plants (up to 1000KW) in Nepal

Table No. 2.3

43
 Distribution of Small Hydro Plants (up to 1000KW)

Kilowatts No. of Plants % of total

1-100 8 22.2

101-200 14 38.9

201-300 6 16.7

301-400 3 8.3

401-500 3 8.3

501-600 1 2.8

601-700 1 2.8

Total 36 100.0

Source: compilation from NEA publications

The table no. 4 shows the no. of small Hydro plants percentage obtain by
different capacity of hydro plants in total no. of small hydro plants.

Figure No. 2.6

44
 Distribution of Small Hydro Plants(number)
16
No.of
plants
14

12

10
no. of Hydro plants

0
1-100 101-200 201-300 301-400 401-500 501-600 601-700
Kilowatts

The above figure no.6 shows the distribution of number of small hydro plant
in Nepal on their generation capacity. There are in total 8 hydro plants generate
below 100 KW. Similarly 14 plants under 100 to 200 KW., 6 plants 200 to 300
KW., 3 plants 300 to 400 KW, 3 plants 400 to 500 KW, 1 plant 500 to 600 KW
and 1plant 600 to 700 KW.

2.6 Distribution of Medium-Sized Hydro Plants (More than 1 MW)

In Nepal
45
 Table No. 2.4

Distribution of Medium-Sized Hydro plants (More than 1 MW)

Megawatts No. of plants % of total

1-20 18 72.0

21-40 3 12.0

41-60 2 8.0

61-80 1 4.0

81-100 0 0.0

101-120 0 0.0

121-140 0 0.0

141-160 1 4.0

Total 25 100.0

Source: compilation from NEA publications

The table no. 5 shows the number of medium sized hydro plants percentage
obtains by different capacity.

Figure No. 2.7

Distribution of number of Medium Sized Hydro Plants on their capacity

46
 Distribution of number of Medium-Sized Hydro plants
20

18 no. of
plants
16

14

12
No. of plants

10

0
1 to 20 21 to 40 41 to 60 61 to 80 81 to 100 101 to 121 to 141 to
120 140 160

Megawatts

Figure no. 7 shows the distribution of number of medium size hydro plant on their
capacity.

2.7 Up-Coming Hydropower Projects (Under-Construction)

Table No.2.5

47
 Up-Coming Hydropower Projects

S. Hydropower company Name of river Capacity Located District

No.
(KW)

1 Gautam Buddha Hydropower Sisne Khola 750 Palpa

Company

2 Unique Hydropower Company Baramchi Khola 999 Sindhupalachowk

3 Khdi Hydropower Khudi khola 3,450 Lamjung

4 Lower Nyadi Hydroelectric Lower Nyadi 4,500 Lamjung

project

5 Molnia Power Pvt. Ltd. Mailing Khola 5,000 Rasuwa

6 Gitec. Nepal Pvt. Ltd. Upper Modi Khola 14,000 Kaski

7 Kathmandu Small Sali Nadi 232 Kathmandu

Hydropower System

8 NEA Middle Marsyangdi 70,000 lamjung

9 NEA Chamelia 30,000 Darchula

10 NEA and Private Sector Chilime 11,000 Rasuwa

11 NEA Kulekhani III 14,000 Makawanpur

12 NEA Gomgad 4,000 Mugu

13 NEA Heldung 5,000 Humla

Total 1,54,831

Source: NEA

The table no. 6 shows the hydro power projects are going on construction or
they are in process of construction. If those hydro power construct properly it will
help to generate 1,54,831 KW hydroelectricity in total.

48
 CHAPTER III
SUMMARY, CONCLUSION & RECOMMENDATIONS

3.1 Summary & Conclusion

49
 The hydropower potential of Nepal is huge and the sustainable hydropower
development becomes the key to make Nepal’s economic growth scenario brighter,
gaining deep inroads into the national goal and priority of poverty reduction.
Hydropower has a number of benefits.

(a) It is a continuously renewable electricity energy source;

(b) It is non-polluting i.e. no heat or noxious gases are released;

(c) It has on furl cost and, with low operating and maintenance cost is essential
inflation-proof;

(d) Hydropower technology is a proven technology that offers reliable and

flexible operation.

(e) Hydropower stations have a long life and many existing stations have been
in operation for more than half a century and are still operating efficiently,

(f) Hydropower efficiencies of over 90 percent have been achieved making it

the most efficient of the energy conversion technologies.

Hydropower offers a means of responding within seconds to changes in load

demand. Fortunately, Nepal is rich in hydro-resources, with one of the highest per
capita hydropower potentials in the world. However, at present, the total
hydropower generation has been 556.8 MW, merely 0.7 percent of the potential,
with connection to 40 percent of the people. It is notable to mention that, by the
end of the Tenth Plan Period (2002-07), 55 percent of the population will have
connection to the electricity. Use of environment-friendly technologies and
implementation of sound legal and institutional issues are critical to improve the
reach of the population to the hydropower. Putting into place a favourable

50
environment for increasing cost effective projects would definitely contribute to
make this target a reality. As a cheap, renewable source of energy with negligible
environmental impacts, small hydropower has an important role to play in Nepal’s
future energy supply.

Micro-hydro systems are particularly suitable for power supplies in rural and
isolated communities, as an economic alternative to extending the electricity grid.
These systems provide a source of chap, independent and continuous power,
without degrading the environment, so essential for the mountainous and
environmentally fragile country like Nepal. To make this outcome a reality,
directing more resources to the power projects focusing on rural population
remains the pre-requisite. The acts and regulations should be made to support the
environment as well as the hydropower development efforts so that the
environment and development go together, especially when it comes to the most
important natural resources development endeavors of the nation.

The major strategies of the power sector have been appropriately identified a
promoting private sector participation in power generation and distribution,
unbundling the activities of the NEA as well as improving its financial viability,
integrating rural electrification with rural economic development programs and
strengthening power infrastructure. In the present global scenario where the oil
prices are remaining higher and future provides an uncertain outlook with respect
to oil, optimal utilization of the abundant natural endowment, viz; hydropower,
would reduce Nepal’s import cost substantially, contribute in improving the
relative competitiveness of the economy both on a regional and global basis, an
fulfil the desire of double-digit sustainable growth in the coming decades.

51
3.2 Recommendations

For the implementation of plan and achieving the targets relation to the
hydropower, development of cost effective small and medium-sized projects to
meet domestic demand at affordable price encouragement of private sectors
investment in hydropower development and power distribution on competitive
basis, acceleration of rural electrification attracting investment from community
and private entrepreneurs, improvement in the integration of social and
environmental and private entrepreneurs, improvement in the integration of social
and environmental mechanism into power development process, encouragement of
the power-based industries and transportation systems to create market for existing
surplus energy an future energy growth are extremely important. Besides,
facilitation the flow of funds from domestic financial sector to the hydropower
sector and institutional set-up for the power export, promoting hydropower
research and development center to assist in preparation of national power system
and improve NEA as a commercially viable entity remain the other challenges.

 As Nepal is a poor country, it has to deepen on foreign investment of

hydropower generation. The generation of hydropower has highly
increased after the establishment of democracy.
 The hydro power energy distribution and price determination depends
upon Nepal Electricity Corporation. Being such, investment by private
sector is on favourable. So privatization in hydro power sector is essential.
 Nepal has the capacity to generate 83,000 Megawatts hydro power but it is
only generate 556.8 megawatt beside it as a business point of view it can
generate 43000 megawatt. But only 1.29 percent of it has been produced
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 till now. So High emphasis should be given on the generation of hydro
energy.
 Hydro power is only that source of energy which is never ended. So being
invested million of dollars in petroleum energy. Lf it is use in hydropower,
Nepal can save huge amount of money and can export hydro power energy
which will helpful to maintain to balance of payment.
 The policy up on hydro power generation by the private sector is not well
developed. The private investor must be free on distribution of hydro
electricity and price determination. The monopoly market of Nepal
Electricity Corporation is a great obstacle of investment on hydro power
generation by private sector.
Electricity generation on dollars is mostly expensive. To generate hydroelectricity
on low cost, policy must be focused on small hydro power construction by
domestic investors

REFERENCES

List of power stations in Nepal - Wikipedia

en.wikipedia.org/.../List_of_power_stations_in_Nepal
Hydropower In Nepal - All About In Hydropower Station Project ...
www.imnepal.com/hydropowers-nepal
Nepal Energy Situation - energypedia.info
energypedia.info/wiki/Nepal_Energy_Situation
(PDF) A Review of Hydropower Projects in Nepal
www.researchgate.net/publication/316369029_A...
Electricity production from hydroelectric sources ... - Data
data.worldbank.org/indicator/EG.ELC.HYRO.ZSMishra, S. K. (2012). A CAMEL

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19 Major Hydropower In Nepal With Present Status & Condition
www.imnepal.com/major-hydropower-in-nepal.
Nepal Energy Situation - energypedia.info
energypedia.info/wiki/Nepal_Energy_Situation
Hydropower Development in Nepal - Climate Change, Impacts and ...
www.intechopen.com/books/renewable-hydropower
Nepal Hydropower Development Program | Fact Sheet | Nepal | U ...
www.usaid.gov/nepal/fact-sheets/nepal-hydropower..
Problems of Nepalese hydropower projects due to suspended ...
www.tandfonline.com/doi/abs/10.1080/..
.

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