Upper Tamakoshi Hydropower

Upper Tamakoshi Hydroelectric Project (UTKHEP) is the largest project so far in Nepal under implementation phase. It is the national priority project and its early commissioning is very important in order to cope with the ongoing electricity crisis in Nepal. It is located in Lamabagar VDC of Dolakha District, Janakpur Zone, Central Development Region of Nepal. It is located in the lower region of the Higher Himalayas, in the catchment of the Tamakoshi River. The Tamakoshi River is one of the major tributaries of the Sunkoshi River in the Koshi River Basin. The intake for the hydropower plant is located at Lamabagar Village, which lies at direct distances of about 6 km south of the border with China (Tibet) and 32 km north to northeast of the Dolakha District centre, Charikot.

UTKHPL was established on 09 March 2007 as an autonomous public company for
the construction and operation of Upper Tamakoshi Hydroelectric Project (UTKHEP)
utilizing domestic financial resources. The majority shares (51%) of the company belong
to Nepal Electricity Authority (NEA), Nepal Telecom (NT), Citizen Investment Trust (CIT)
and Rastriya Beema Sansthan (RBS) with stakes of 41%, 6%, 2% and 2% shares respectively.
The company has issued the shares to the contributors in Employees’ Provident Fund
(17.28%), NEA and UTKHPL staffs (3.84%) and staffs of debtor institutions (2.88%) in the
Fiscal Year 2014/15 and the remaining 25% of equity capital have been allocated to General
Public (15%) and Residents of Dolakha district (10%) in Fiscal Year 2018/19.

PPA for the project has been signed with NEA on 29 December 2010. As per the PPA, the
average purchase rates have been fixed as NRs. 3.50 per unit for the base year (2010/11) and
NRs 4.06 per unit at Commercial Operation Date (COD). After 9 years of COD with annual
escalation of 3%, the average purchase rate will remain as NRs. 5.30 per unit throughout
the tenure of PPA. The project is being financed through debt-equity ratio of 70:30. The
financial closure with all financial institutions has been concluded on 12 May 2011 for the
required debt portion. As per the separate loan agreements, EPF and NT have invested
NRs. 10 Billion and NRs 6 Billion respectively whereas CIT and RBS have invested loans of
NRs. 2 Billion each. Similarly, Government of Nepal (GoN) has provided loan of NRs. 11.08
Billion to fulfill the financial gap furthermore, debtor institutions (EPF, NT, CIT and RBS) have
also agreed to provide additional loan to cover increment in the project cost.

S.N. Contract Lot Name of Contractors
1 Lot 1 – Civil Works Sinohydro Corporation Ltd., China
2 Lot 2 – Hydro-mechanical Works Texmaco Rail & Engineering Ltd., India
3 Lot 3 – Mechanical and Electrical Works Andritz Hydro GmbH, Austria
4 Lot 4 – Transmission Line & Substation Works KEC International Ltd., India