People in our country would not have had to go through the present sufferings from the horrifying load-shedding situation had our planners and policy-makers cared to pay due attention to techno-economic aspects in course of planning hydropower projects in recent years. It is still possible to improve substantially the present electric power shortage situation within relatively a very short period perhaps at less than half the investment earmarked by the government for the generation of electric energy in near future if our power development plans are adequately rationalized based on sound engineering practices.
Understanding of Energy Economics
Our electricity planners do not appear to take cognizance of the fact that the electricity price (as well as generation cost) varies not only with the seasons but it also widely varies even within a very short period of just one day. The cost of generation of electricity for the supply of peaking demand in the evening hours can be usually about three times more expensive than that of the off-peak hours. For example, the 10,800 MW Karnali Chisapani hydropower would be generating annually 20,800 GWhr firm peaking energy whereas the much smaller 2,500 MW capacity alternative Karnali Chisapani hydropower could also have generated annually the same amount of 20,800 GWhr firm energy at almost one third the investment of the former if the latter was to be dedicated to meet the demand for the base load instead of peaking. The wide difference in value of energies used for peaking and base load is the prime cause that serves as the basis for the feasibility of pump storage projects, which are built at enormous investment to obtain one unit electricity for peaking purpose by spending two units of electricity generated during the off-peak hours.
Worsening Power Shortage Crisis
At present our country is reeling from acute shortage of electric power. Most of our industries are on the verge of collapse. People are facing great hardship due to long hours of load -shedding. We are now pushed to an extreme desperate situation. It has even started to cross the mind of some of our decision makers that the introduction of diesel power plants on a gigantic scale is the only solution to end the present power shortage crisis. Our planners must bear in mind that diesel power stations might be feasible to supply power to meet the requirements for extremely short duration peaking demand but under no circumstances it would be feasible to meet the demand for base load at a time when the price of petroleum products are skyrocketing.
Nature of Load-shedding
At present during the wet season months quite limited areas are affected by load-shedding lasting only for a very short period in the evening. Even such limited disruption in supply of power might have been to a certain extent the result of transmission lines congestion coupled with the NEA’s power purchase agreements biased in the IPP’s favour. One of the executives of the NEA Keshav Upadhyay has painfully written in the NEA Bulletin dated Falgun 2067 touching on the subject of power tariff “…energy rate of the NEA plants would have further lowered but for stiff conditions in power purchase agreements like take or pay which forces the system operator to shut down NEA owned run-off-river plants…”.
It is predicted that during the coming dry months the load-shedding is going to exceed 16 hours a day from the present 11 hours. Even now, the midnight hours when the electricity demand is the lowest are not excluded from load-shedding. It is quite obvious that the NEA is now facing acute shortage of base load energy which could have been produced at exceptionally low cost within a very short period. Seasonal energy produced on a massive scale during few monsoon months could not be substitute for the firm energy needed to meet the ever increasing unfulfilled demand for base load during the dry seasons.
Seasonal Energy is Worthless
In the context of Nepal the seasonal energy is now worth nothing. At present there is not any demand for seasonal energy inside Nepal. The export of such short duration seasonal energy might not be feasible because its value could be only equivalent to saving in costs of the fuels in Indian thermal plants as a result of substitution to electricity imported from Nepal. According to the World Bank financed Karnali Project report the value of such exported seasonal energy could be equal to only 10% of the value of the firm energy. Contrary to very low valuation of the seasonal energy, the cost of the transmission specially provided to export seasonal energy could be as high as 20% of the value of the firm energy.
Storage Projects Not Suited
Large storage projects like the Budhi-Gandaki project and West Seti project would not be suited to resolve quickly the present power shortage crisis because it would take quite a long time to make arrangement to recover irrigation benefits accruing to downstream region. The irrigation benefits are found to be far exceeding the power benefit. For example, according to the detailed feasibility report of the Kankai Storage Dam Project carried out by the German Government in 1978 the annual irrigation benefit was found to be US Dollars 31.4 million whereas the power benefit was only US Dollars 7.2 million.
Gross Misuse of Existing Hydropower Projects
All the NEA owned hydropower projects, like the Kali-Gandaki, both Trisuli, both Marshyangdi, both Kulekhani and others are capable to run at full capacity even during the dry season periods. They have been built at enormous cost to supply electricity to meet the demand for peaking. Obviously, the generation cost of such peaking energy is always very high. Unfortunately at present the full capacity of these hydropower projects built to generate high valued peaking energy has not been fully utilized during the critically important dry season periods. They are now operated to produce a very large proportion of cheap energy to meet the demand for base load. Thus, the reservoirs, high barrages, turbines, generators, transmission lines and civil structures provided to generate and transmit peaking energy have not been utilized to the full extent. It is one of the reasons why the generation cost of the NEA produced electricity is high.
The generation cost of the peaking energy, as explained above, is about two to three times more expensive than that of the energy supplied to meet the demand for base load. A fifty percent proportion of the base load and the peak load capacities of the power stations operating in a power grid is normally considered to be optimum mix. It implies in our case that the overall firm generating capacity of our power grid should have already grown very high on top of the existing 450 MW firm capacity ( 400 MW peaking capacity and 50 MW base load capacity) in order to effectively use the additional peaking capacity of the NEA proposed 456 MW Upper Tama-Kosi project. Thus, it would be too uneconomic under present circumstances to implement a hydropower project suitable to produce excessively large peaking power such as the 456 MW Upper Tama-Kosi project.
We are at present grossly underutilizing the capacity of the existing hydropower plants and at the same time we are preparing to implement at huge cost excessively large new hydropower projects that are not feasible to meet the required type of demand for electricity supply in immediate future. As a result, the generation cost of the electricity would be sharply increased in future, and it would also take a very long time to implement the project earmarked to provide quick relief from the worsening power shortage crisis.
Mini Upper Tama-Kosi Project
For quick relief from the present power shortage crisis relatively a much smaller alternative of the NEA proposed 456 MW Upper Tama-Kosi Project would be best suited for implementation in near future. The proposed alternative to NEA’s 456 MW project would involve far less risk of damages to structures at the time of glacier lakes outburst floods (GLOF). Similarly, the possibility of substantial drop in generation of electricity resulting from the seepage of water through the highly porous floor of the reservoir particularly in dry seasons , when the demand for electricity is the highest, would be almost totally avoided.
Considering the nature of the present demand for electricity in our country and also the vulnerability of main project structures, the installed capacity of the Upper Tama-Kosi Project must be limited to just over 100 MW. Even after such drastic reduction in installed capacity the total generation of electric energy during the dry season period would still be equal or even exceeding the generation by the NEA proposed 456 MW project despite the fact that the cost of such mini- project would be only about one third. As the demand for peaking energy grows in future the installed capacity could be raised with ease by providing additional structures if it is found after some years of operation that the GLOF and the geology of reservoir site would not pose serious threat to the safety of the project.
Danger of GLOF
There are several rapidly growing glacier lakes near the project site in Tibet. The great risk of glacier lakes outburst floods (GLOF) to high gated barrage and other structures of the NEA proposed Upper Tama-Kosi project should not be underestimated. We already have a bitter experience of the 1984 Digcho GLOF when the Namche hydropower built on the upper reach of the Dudh-Kosi river was completely washed away.
The reconstruction cost could be too much if the barrage and intake structure of the NEA proposed Upper Tama-Kosi project would be seriously damaged by big GLOF. Power supply would be suspended for a very long time which would have terrible consequences for the economy of entire country.
The Mini Upper Tama-Kosi project would be having only ungated weir across the river. The GLOF would cause only limited damage to the weir. The damage could be repaired within a short period at a relatively small cost.
Seepage through Reservoir floor
It is reported that the flat reach of the Tama-Kosi river serving as the floor of the reservoir of the NEA proposed hydropower project is made of 300 meters high fill materials over the original river bed. The fill materials had accumulated after the landside dammed the river.
There is a great possibility of excessively large seepage of water from the reservoir. As a result of such seepage, there can be significant reduction in electricity generation in dry season.
The mini Upper Tama-kosi project would not require the provision of a reservoir. The question of energy losses resulting from the seepage through the floor of the reservoir does not arise.
Nepal does not need to go for large storage projects to generate enough firm energy needed to meet our demand for base load for coming many years. There are many suitable identified run-of- river type projects in the mid hill regions.
The Mini Upper Tama-Kosi hydropower would be relatively a very small project which could be implemented within a short period to provide quick relief from the present severe load-shedding. The generated electricity would be very cheap and thus it might not be necessary to raise significantly the electricity tariff within the coming few years.
There would not be much hitches in implementing initially the proposed mini project as first stage of the large 456 MW Upper Tama-Kosi project.
Dr. Thapa is a water resources expert and former member secretary of Water and Energy Commission.