Norway’s Statkraft, the world’s largest renewable energy producer, has opted not to invest in a hydroelectric power plant in Nepal.
Reuters reports that the Tamakoshi III plant, 62 Km north of Kathmandu, would have generated 650 MW, much of which was destined for export to power hungry India.
Ghanashyam Ojha, external affairs chief with the Investment Board Nepal (IBN), said the Norwegian state-owned energy giant had decided not to move forward partly due to an incomplete power infrastructure link with India.
Ojha said the Nordic group were put off as it was not sure it could send the power to markets in India, as necessary cross-border transmission lines are not in place yet. In addition last year’s earthquake, which hit the region specified for build very hard, may have informed their decision making in terms of investment risk.
Officially Statkraft said it had backed out after a thorough assessment of the commercial, technical and regulatory factors as well as what it called a non-conducive project development environment.
“These factors include a lack of viable power offtake option, lower electricity price forecasts, insufficient transmission capacity for power evacuation and absence of necessary policies and regulatory framework for operationalizing power sales,” country director Sandip Shah said in a statement.
Nepal is estimated to have the potential to generate more than 42,000 MW of electricity, but has installed capacity of just over 800 MW and has daily power cuts for up to 15 hours.
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