Hydroelectricity Investment and Development Company Ltd (HIDCL), a government-owned power company, plans to invest Rs 36 billion to develop hydropower within the next five years.
This recent business plan was approved by the board of directors of the HIDLC in a meeting led by the Energy Secretary. In the meeting, it was decided that HIDLC would invest in projects initiated by Independent Power Producers (IPPs).
Chhabi Raj Pokharel, chief executive officer of HIDC, said, “We have already finalized to invest in various projects with a total installed capacity of 238 megawatts and some are under discussion.”
HIDLC has already finished negotiations with IPPs to invest Rs 5.09 billion. It is planning to invest Rs 16.21 billion in projects to be developed by government-owned companies and also the Nepal Electricity Authority (NEA).
The company will invest in projects by IPPs with the capacity to generate 565 megawatts and projects with total capacity of 640 megawatts in the next five years.
Pokharel said, “Commercial banks in the country have the capacity to chip in around Rs 80 billion to Rs 90 billion in the hydropower sector. We are also looking for the line of credit from development partners to invest in the hydro sector.”
HIDLC is negotiating with the Asian Development Bank (ADB) to mobilize $50 million under the line of credit (LoC). This credit is issued under sovereign guarantee and bears a two percent interest.
Pokharel said, “The MoF will disburse the LoC provided by ADB to HIDCL, thus, we can mobilize the fund at a relatively cheaper interest rate.”
Along with the ABD, the company is also negotiating with Employees Provident Fund, Citizen Investment Trust, Rastriya Beema Sansthan and the Welfare Fund of Nepal Army, among others.