Kai Gandaki Case Study

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5.5 Kaligandaki A (144 MW) The Kali Gandaki A project was established with an objective to help meet the increasing demand for electricity in Nepal in an environmentally sustainable, socially acceptable as well as least-cost manner. The project’s objective also included improving the financial and operational performance of NEA (executing agency) (Nai 2004). It is a run-of-river project located near Tansen on the Kali Gandaki River in the central region of the country (about 180 kilometers west of the capital). The plant has an installed capacity of 144 MW and is a daily pondage. It is currently the largest hydropower plant in operation in the country (Thanju 2007). The consulting services for design and supervision were carried out by Morrison Knudsen International Inc. along with IVO International and Norconsult International. Similarly, the civil works were carried out by an Italian company named Impregilo Spa whereas hydraulic works were conducted by a German company called Noell Stahl. Furthermore, the contract for electrical works was awarded to a Joint Venture between Mitsui, Toshiba, and Alstom. In addition, contract for mechanical works was given to Mitsui and Toshiba Joint Venture and contract for transmission lines…show more content…
Similarly, the World Bank and ADB provided loans as soft credit payable over a period of 30 to 40 years at service charge of less than one percent. Other assistance was grant-cum-credit. The foreign assistance roughly comprised of 70 percent subsidy element. Furthermore, the annual electricity generation from the project would yield about five billion rupees (at prevailing tariff at that time). Approximately one billion was estimated for debt servicing obligations and operational costs of the project. That means about four billion rupees was available for the GoN as a net revenue from the project (Mahat

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