After long disputes, Bhotekoshi Power Company has decided to provide six percent share to local people. It is a rarest practice of distributing project shares to local people 13 years after commencement of project operations.The 45-MW project was developed with a majority foreign investment and started generation in 2001.
BKPC on Wednesday finally agreed to this effect with protesting local political leaders backed by lawmakers, clearing the way for reconnection of the electricity generated by the project located near Tatopani in Sindhupalchowk district. Local leaders of five political parties in September obstructed the laying of pylons for the transmission line which were swept away by the Jure landslide of August 2. They were demanding shares in the project reports Rudra Pageni in The Republica.
BKPC will provide the shares free of cost at the rate of Rs 100 per share to a company formed by the local people. However, the details of the share distribution modality are yet to be set out, said CPN-UML leader Amrit Bohara, who is a lawmaker from the district.
BKPC has also agreed to pay Rs 2.25 million each annually to Tatopani and Phulpingkatti VDCs, which are directly affected by the project. Likewise, seven other VDCs -- Marming, Gati, Maneshwara, Ramche, Dhuskun, Tekanpur and Pangretar -- will receive a lump sum of Rs 2.25 million in total every year from the project.
Speaking at a press meet held to make public the agreement on Thursday, Narendra Prajapati, general manager of BPKC, announced the details of the agreement.
President of Independent Power Producers’ Association Nepal (IPPAN) Khadga Bahadur Bistha said investors have been caught by surprise in being compelled to distribute shares to the locals after protests by them.
Bhotekoshi Power Company Private Limited is a joint venture between US and Nepali investors. It has invested US$ 90 million in the project.
The government had been piling pressure on BKPC to revise the power purchase agreement (PPA) as electricity buyer state-run Nepal Electricity Authority has suffered a huge loss due to devaluation of the Nepali currency vis-à-vis the dollar. NEA had signed the PPA with Upper Bhotekoshi Hydropower Project at 6 cents per unit in 1997.
Separately, a study on PPAs in foreign currency, including the Upper Bhotekoshi Hydropower Project, is under way at the Public Accounts Committee of parliament.
The Upper Bhotekoshi PPA is valid for 25 years from the commercial operation date of January 24, 2001. As per the agreement, 50 percent of the project assets will be transferred to NEA after 25 years of operation and the Government of Nepal will own the whole project after 40 years.
The US$ 90 million project was developed by a joint venture company of Nepali and American companies. Shareholders of BKPC include Himal International Energy Private Limited, Himal International Power Corp Private Limited, Tara Fund Pvt Limited and RDC of Nepal.