RE: upper tamakoshi

February 16, 2011

Paras Kharel

Kathmandu

Paras jee

I too am concerned about this project, but from another perspective and I am also critical of it on a number of counts. But not wanting to provide additional fuel to conspiracy theorists I am keeping rather quiet.

• Some of the problems you have referred to are now emanating from mushrooming NGOs that plan to live off it. They should be told to desist. Because this will impel this project to emulate middle Marshyangdi leading to disaster for NEA and financial crisis for Nepal due to potential collapse of lending institutions like EPF et al.
•  Unfortunately for Nepal, this project is already on track to follow the footsteps of middle Marshyangdi due to defective format, content and structure of contracts which are open ended and subject to both cost overrun and time overruns.
• NEA and its customers are not going to be benefitted from the low cost that you have mentioned. Its cost of generation is said to be around 2.5 US ¢. But PPA was signed at 5.4 US ¢ which is unreasonably high. The tariff should have been fixed at a level that would have afforded the project a return of about 25% only; not more than 100%. I, especially, don’t like this because NEA is asking for escalation of consumer tariff while frittering away an opportunity not to have to do so by purchasing electricity from this project at reasonable rate.

With best regards,


Sincerely,

Ratna Sansar Shrestha, fca
Senior Water Resource Analyst

www.RatnaSansar.com

From: paras kharel [mailto:kharelparas@yahoo.com]
Sent: Tuesday, February 15, 2011 14:31
To: Ratna Sansar Shrestha
Subject: upper tamakoshi

Dear Ratna Sansar ji,

The Upper Tamakoshi project, meant exclusively for domestic consumption and being developed with domestic resources, is attracting protests. Without wanting to sound like a conspiracy theorist, I do feel that the protests may be a ploy executed by people behind the scenes to foil the project and turn it into an export-oriented one (as the unit generation cost is said to be low). 

What do you think?

Best

Paras