Sunkoshi-III 683 MW Hydropower Plant

Current Status: Proposed
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The Sunkoshi River at the project site

Sunkoshi 683 MW Hydropower Project, also called Sunkoshi-III Hydroelectric Project, is a proposed power plant to be constructed in an area of 5,520 sq. km in Kavrepalanchok, Ramechhap, Sindhuli and Sindhupalchowk districts of Nepal (IBN 2019). The proposed Sunkoshi-III Dam site is some 60 km far from Kathmandu city (Coordinates: 27.7537, 85.8380). It is proposed to be sponsored jointly by two Bangladeshi conglomerates, Summit Group and United Group along with developers from India and Nepal in cooperation with Governments of Bangladesh and Nepal.

According to the plan, a 160-meter-wide and 180-meter-high dam will be built on the Sunkoshi River between Temal Rural Municipality-9 of Kavrepalanchok District and Lubhughat in Kandadevi Rural Municipality-1 of Ramechhap District (NepalNews 2021). The powerhouse will be constructed at Titretar in Temal Rural Municipality-9, about 400 meters away from the dam, which will get 570 cubic meters per second (cumec) of water through two penstocks to generate electricity (New Spotlight 2022.

Capacity

According to the current plan, the power plant will be constructed with an installed capacity of 683 MW (Bhat 2022). But in both the Master Plan Study on Koshi River (1985) and Nationwide Master Plan Study on Storage-type Hydroelectric Power Development (MPSHP) 2014, Japan International Cooperation Agency (JICA) recommended the installation of the Sunkoshi-III Hydropower Plant with a capacity of 536 MW only (JICA 1985, JICA 2014).

Background

JICA conducted a Master Plan Study on the Koshi River Water Resources Development in 1985. The Master Plan prescribed to develop three Hydropower plants and water diversions on Sunkoshi River namely Sunkoshi-1, Sunkoshi-2 and Sunkoshi-3 (JICA 1985). In the MPSHP 2014, conducted by Tokyo-based Electric Power Development Company Limited (J-POWER) under assistance from JICA, Sunkoshi-III Hydropower Plant was recommended as one of the Promising Storage-type Hydroelectric Power Projects (JICA 2014).

In 2014, the Asian Development Bank (ADB) provided USD 1.00 million as Technical Assistance grant from the Department for International Development (DFID) of the United Kingdom for conducting a feasibility study on Power Trading in Bangladesh and Nepal. The project was closed in March 2016 without any outcome report (ADB 2014). The bank also provided a concessional loan of USD 21.00 million for ‘Project Preparatory Facility for Energy’ to develop projects on Sunkoshi-II, Sunkoshi-III and Dudhkoshi Hydropower Projects. The project activities include Initial Environmental Examination (IEE), Environmental Impact Assessment (EIA) and Social Impact Assessment (SIA) for Sunkoshi-III Hydroelectric Project (ADB 2021).

In October 2016, The Commerce Minister of Bangladesh and his counterpart of Nepal signed a Memorandum of Understanding (MOU) to construct two hydropower plants, i.e. 1,110 MW Sunkoshi-II and 536 MW Sunkoshi-III, under Government-to-Government (G2G) investment (Hydro Review 2016). The plan failed due to lack of coordination between the ministries. In August 2018, both of the countries signed an Energy Sector Cooperation Agreement (ESCA). Following the ESCA, a joint technical committee was formed at the secretary level meeting held on 4 December 2018 (Subedi 2018).

At the next meeting held on 21 June 2019, the energy secretaries agreed to select bankable projects and to use Indian ndian infrastructures for the immediate purpose also with the aim to build a transmission line via India in the near future (BS 2019).

Meanwhile, the Department of Electricity Development (DOED) of Nepal started a feasibility study on the Sunkoshi-II and Sunkoshi-III Hydropower Project in 2017 (Bhat 2022). The Sunkoshi-III project was found viable according to the study finalized in April 2022 (New Spotlight 2022). A public hearing was organized in June 2022 after completion of the technical study (NepalNews 2021).

In March 2021 during the visit of Nepalese President, the Prime Minister of Bangladesh emphasized on a tripartite agreement between Bangladesh, India and Nepal to set up Hydropower Plants in Nepal under Bangladesh-Bhutan-India-Nepal (BBIN) Connectivity (FE 2021a). In June 2021, the State Minister for the Ministry of Power, Energy and Mineral Resources (MOPEMR) of Bangladesh said to the media that Bangladesh planned to import 700 MW of hydropower from Nepal (FE 2021b).

The State Minister for MOPEMR of Bangladesh confirmed the deal of importing 700 MW of electricity from Nepal in November 2021. He also confirmed that the International Finance Corporation (IFC) promised to cooperate with Bangladesh in cross-border energy trading (TBS 2021).

According to the media report, the Government of Bangladesh is to propose an investment plan for the project at a meeting of the joint working group and steering committee of the two countries in July 2022. Summit Group and United Group, two biggest independent power producers of Bangladesh, wanted to join the discussion with Nepalese counterpart (Sajid 2022).

The Ambassador of Bangladesh in Nepal visited the sites of the dam and powerhouse, and the affected area on 13 July 2022 and confirmed that Bangladesh has great interest in construction of the project (Bhat 2022). A technical study team of Bangladesh is to visit Nepal in the period of July-August 2022 (HNS 2022).

Land Acquisition

Total 1,364,022 acres of land, including rivers and lakes, to be acquired by the Nepal Electricity Authority (NEA) for the project (IBN 2019). According to the media report, the project will affect at least 3,600 households in which at least 1,565 will lose their houses and farmlands (New Spotlight 2022). Farmlands situated even 45 km upstream of the power plant will face inundation due to the project (Bhat 2022). The affected areas are: (i) three rural and two urban municipalities in Sindhupalchowk (ii) three rural and two urban municipalities in Kavrepalanchok, (iii) two rural municipalities in Ramechhap and (iv) one rural municipality of Sindhuli (NepalNews 2021). The JICA study (1985) suggested relocating the displaced people in Panchkhal and Timal in Kavrepalanchok and other sides of the Koshi River (NEF 2014).

Finance

According to the Technical Study conducted by DOED, the total cost of the Sunkoshi-III Hydropower Project could be NPR 160 billion (USD 1,344.54 when USD 1.00=NPR 119.00) (My Republica 2022). Earlier, the required amount for the project was estimated at USD 1,690.5 (JICA 2014). But the Investment Board of Nepal (IBN) estimated the project cost as USD 582 million without the transmission line (IBN 2019). Share of equity and debt or the source External Credit Agency (ECA) finance has not been confirmed till date but, according to the media, International Finance Corporation (IFC) expressed its interest to support in bilateral energy trade between Bangladesh and Nepal (TBS 2021).

Sponsors

The power plant is to be sponsored by two Bangladeshi conglomerates Summit Group and United Group (Sajid 2022). According to the Executive Director of Nepal Electricity Authority (NEA), companies from Bangladesh, India and Nepal will jointly invest in the power plant (Bhat 2022). The current sponsors have not disclosed any information about Joint Venture Company (JVC) or Special Purpose Vehicle (SPV) till date.

Contractors & Suppliers

Any Engineering, Procurement and Construction (EPC) contractor, Consultant, or equipment suppliers have not been selected till date.

Water Reservoir

The Sunkoshi-III Hydropower Plant will create a 45 km long water reservoir of 5,520 sq. km across four districts. The water level will be 700 meter and 674 meter high from the mean sea level (MSL) at full supply level and minimum water level respectively. The estimated gross reservoir capacity is 1220 million cubic meter (MCM) while effective capacity is 550 MCM (IBN 2019). The reservoir will cover from Indravati river (Sipaghat of Kavrepalanchok district) to Sunkoshi river (Balephi of Sindhupalchowk district). A total of 570 cumec of water will pass through a 1.1 km long and 9 meter diameter tunnel (penstock). After use in turbines, the water will be released into the Sunkoshi River through a tailrace (New Spotlight 2021).

Power Generation

According to the earlier plan, the construction of the power plant is likely to commence in 2027 and is expected to enter into commercial operation in 2031 (JICA 2014). The sponsor is to set up a substation near the Sunkoshi Marine Diversion Project, some 25 km far from the hydropower plant, to evacuate the power to the national grid (Bhat 2022). As per the Master Plan, the power plant will generate 2,632.56 million units (gWh) of electricity at 44% Plant Load Factor (PLF). The rate of electricity per unit is yet to be finalized.

Transmission

At least 23 km of cross-border transmission line over Indian territory and High Voltage Direct Current (HVDC) substations are required to transmit power from Nepal to Bangladesh. Nepal has cross-border transmission lines with the Indian states of Bihar, Uttar Pradesh and Uttarakhand, but it has no line with West Bengal, which is the Indian state between Bangladesh and Nepal (Sajid 2022). However, Bangladesh signed a Memorandum of Understanding (MOU) with NTPC Vidyut Vyapar Nigam Limited (NVVN) to import power from Nepal (Subedi 2018).

Environment

The Environmental Impact Assessment (EIA) of the project has not been conducted till date. The DOED scheduled a public hearing in four districts of the project-affected area from the last week of September 2021 (NBA 2021). DOED has already spent more than NPR 190 million (USD 1.60 million when USD 1.00=NPR 119.00) for Feasibility Study of Sunkoshi-II and Sunkoshi-III Hydropower Project while the officials estimated the amount could reach NPR 330 million (USD 2.77 million when USD 1.00=NPR 119.00) (NepalNews 2021). Neither the Feasibility Report nor draft EIA is publicly available till date.

Carbon Footprint

The Intergovernmental Panel on Climate Change (IPCC) estimated that the hydropower plants emit 24g of Greenhouse Gasses (GHS) to generate each kilowatt hour (kWh) of electricity while International Hydropower Association (IHA) estimates it as 23g/kWh (IHA 2021). Study report on Tropical regions shows that, Hydropower Plant and reservoir combinedly emit GHGs at a rate 316g/kWh which is really alarming (Tremblay et al. 2004). Studies in the Mekong region found the emission as 275g/kWh including the power generation and reservoir (Räsänen et al. 2018). In a conservative calculation, the Sunkoshi-III Hydropower Plant could emit 160g GHGs to generate each kWh of electricity. According to the estimation, the power plant could emit 583.95 kilo tonnes of carbon per year at 61% PLF and 35.04 million tons in its operation period of 60 years.

Criticism

According to the feasibility report, at least 1,565 households fully and 3,600 households partially will be affected by the project. Seven dams and adjacent powerhouses in Temal Rural Municipality of Kavrepalanchok district could be inundated while dams in Kandadevi Rural Municipality of Ramechhap district could be affected by floods after construction of the project (New Spotlight 2022).

GOB wants to buy 500 MW from Sunkoshi-III at 83% PLF, which means at least 3635.40 gWh of electricity per year. But the power plant is capable of supplying only 2,632.56 gWh, which is 1,002.84 gWh lower than the desired amount of electricity. To supply the whole electricity as agreed, the power plant needs to run at a minimum 61% PLF.

References

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