Opinion (Spotlight Weekly)

Power Export And Upper Karnali Project

By AB Thapa

Nepal has been hoping since a long time that in near future it would be possible to export on a very large scale hydroelectricity produced in our country. Unfortunately our concerned institutions never seriously cared to explore the foreign markets for our power, despite the fact that some of the studies carried out under the aegis of the donor agencies do provide a good deal of information. It would be explained hereinafter that the full-scale Upper Karnali Project could be the best among all projects studied so far for the export of cheap power to India. Astonishingly, neither the Water Resources Ministry nor the Planning Commission appear to be aware of it. As a result, the Ministry of Water Resources is doing its best to implement the simple diversion type Upper Karnali Project that would ruin the prospect for the generation of electricity on a large scale for export to India at a highly competitive price to the benefit of both the countries.

India’s Power Market

At present India is experiencing an acute shortage of peaking energy. At the beginning of the Eight Plan, the total peaking shortage was 20% whereas the energy shortage was only 9% of the total power generation. The thermal and nuclear power stations are suitable to supply electricity to meet the base load demand of the system. It is not economic to use them to supply peaking energy. Gas turbines can be used to meet the peak load demand because of low specific investment costs and quick start up. However, the efficiency is limited due to the high exhaust gas temperature of the turbine

India is making every effort to improve the hydrothermal mix for ensuring better system operating condition. However, the share of hydropower in the overall power generating capacity has steadily declined since the last few decades. The share of the hydropower in the overall power generating capacity was 50.6% in 1963. But few years before it has come down to only 25.66%.

Pumped Storage Schemes

Most of the good sites for the hydropower development have already been developed in the Northern India. There are even now several good sites for hydropower development in the North-Eastern India which have not as yet been used. However, such sites are at locations far away from the load centers. As a result, the Government of India in recent years had to embark on a plan to develop the pump storage schemes

Pumped storage schemes are provided for the generation of peaking power, even though there is a net energy loss in the system because more energy is consumed in pumping than can be produced by the turbines. The cycle efficiency of a pumped storage plant can usually be between 60 and 70 percent. It implies that such a plant consumes abut three units of electricity to produce only two units during the peak hours. The cost of the peaking energy produced by a pumped storage plant will have to take into account the investment to be made in the construction of the pumped storage plant. The per unit capacity investment cost of a pumped storage plant can be comparable to the cost of a similar hydropower located at a favorable site.

So far 56 major pumped storage schemes with a total installed capacity of 94,000 MW are reported to have been identified in India. Already few pumped storage schemes such as the Nagarjun Sagar (700 MW), Kadampani (400MW), Kadana (240MW), Panchit (40MW), Paithan, and Ujjani are either in operation or under various stages of construction. Bids were being evaluated some years ago by the West Bengal authorities for a civil work contract for the 900 MW pumped storage facilities at Purulia on the Ayodhya hills. Three other pumped storage facilities of similar capacity are being planned. The pumped storage at Sardar Sarovar (1200 MW) and Tehri (1000MW) are planned for construction in near future.

Upper Karnali Storage Project

The Upper Karnali Storage Project could be ranked at the very top among all hydropower projects identified so far in Nepal including the Karnali (Chisapani) High Dam Project for the generation of cheap peaking energy. The total installed capacity of this power station could be about 4,000 MW at 25% capacity factor. Unfortunately, the Government institutions and the donor agencies in Nepal are virtually unaware of this vast potential. At present we are on the verge of ruining this potential by leasing out this site to a private developer to build a relatively small simple diversion type hydropower with a capacity of about 300 MW There is an urgent need for holding debates to be participated by few specially invited well recognized experts in the field of hydropower engineering on this issue before it is too late.

The Karnali Bend

The Karnali river makes a big loop in its lower reach near a place called Asare. From here the river flows in the south-east direction for about 25 kilometers, after that the river makes a complete reversal in its direction. The river comes back to a point just two kilometers away from its earlier position near Asare. There is a drop of about 150 meters in Karnali river bed elevations between these two positions merely two kilometers away from one another. The project to utilize this bend for power generation was originally known as the Karnali Bend Project. Later on the name was changed to Upper Karnali Project.

Feasibility Studies

The Karnali basin is the first to arouse keen interest in Nepal's vast hydropower development study. There are several attractive sites for the generation of cheap hydroelectric energy in this basin. In early 1960s an agreement was signed between HMG of Nepal and the UNDP for providing assistance to conduct a survey of the Karnali river and its main tributaries culminating in a pre-investment report indicating hydroelectric potential of the river as well as the best sites for hydropower development. The final feasibility reports and general basin development report were submitted in February, 1966.

In 1980s further studies of the two projects were carried out under the aegis of the World Bank. They are the feasibility study of the Karnali Dam Project (Chisapani) and the pre-feasibility study of the Upper Karnali Hydroelectric Project ( Karnali Bend Site). Unfortunately, the scope of the Upper Karnali Project study was deliberately made very narrow. The size of the project was scaled down to be suitable to meet the Nepal's internal power requirement completely disregarding its vast potential to generate exceptionally cheap peaking energy for export to India. The concept of the small Upper Karnali Project is very simple. It includes a small diversion dam to provide daily regulation, a spillway for the passage of excess water across the dam particularly during the floods, desanding facility, a power tunnel across the Bend, and a power house at the downstream side of the Bend. The small Upper Karnali project is not at all an inferior project by comparison with many other hydropower projects similar in size. The proximity of the dam site from the power house helps to bring down the cost of the delivery tunnel and its related structures like the surge chambers although the construction of a low height diversion dam across a big river of the size of the Karnali flowing in a narrow gorge is not an advantage. Unfortunately this small diversion project as explained before could preclude the viability of the full-scale Upper Karnali Storage project. It indeed is a matter of great concern. It might astonish many of us to learn that the per unit investment cost ( US Dollars/ KW ) of the Upper Karnali Storage project could be much less than such cost of the Karnali Chisapani High Dam project. Thus this project could be the most attractive hydropower project for the export of peaking power to India among all projects identified so far in Nepal including the greatly publicized Karnali Chisapani Dam project.

The Upper Karnali Storage Project

It has been explained in the Upper Karnali study report that a Karnali Bend storage hydro project could include a dam up to 260 meters in height. The most economical way of developing the full power potential of the Karnali Bend would result from construction of a large storage dam on the eastern side of the bend, a power tunnel across the bend and a generating station located on the western side of the bend. If the Upper Karnali Storage project were developed to its full potential, some 4000 MW of power at 25% capacity factor based on firm energy for meeting the peaking demand could be installed.

Comparision With Karnali Chisapani Project

The Upper Karnali Storage project and the Karnali Chisapani Storage project both would be having waterways quite comparable in length, but the Upper Karnali project would be operating at a head almost two times greater than that of the project at Chisapani. It makes the Upper Karnali project far more attractive for export of cheap peaking power to India than the Chisapani project. Reasons for it are explained below.

Of all the site characteristics, head is the most important. Design guidelines, 1989 approved by the American Society of Civil Engineers has given some simple reasoning that would help to explain why the Upper Karnali project operating at a head about two times greater by comparision with the Chisapani hydropower could be built at far less per unit installed capacity cost. "Very simply if one doubles the head the quantity of water needed to produce a certain amount of energy is halved, Thus, for like site energy development the conduit area and reservoir volume are halved and further large cost reductions occur for powerhouse and machinery costs. This fundamental consideration is at the root of the large cost reductions that occur at higher heads." Needless to mention that the lower investment cost means the generation cost of the electricity would also be less.

The Stage A study report of the Karnali Chisapani Project shows that the increase in hydraulic head greatly helps to enhance the net project benefit. It has been explained in the report that the incremental benefit would be about six times greater than the incremental cost if the height of the Chisapani dam is further raised over the present height fixed at 270 meters. It is stated in the report that the dam height was limited at 270 meters for the reason that higher reservoir levels and dam heights would cause the abutments of the dam to spread into the Banghar Khola upstream and would severely constrain project development between the downstream toe of the dam and the preferred spillway plunge pool location downstream. It is not satisfactorily explained in the report why other sites further upstream suitable for much higher dams were not considered for the optimization study.

A Great Loss To Nation

The Upper Karnali Storage project about half the size of the Karnali Chisapani project in terms of annual electricity generation could help to accrue our country enormously large benefits from the export of electric power at highly competitive rates. Such excellent opportunity could vanish if we unwisely decided to lease out the Karnali bend site to a private developer to build a relatively small simple diversion project.

It might well turn out that the Upper Karnali storage project and the Upper Karnali simple diversion project are mutually exclusive of one another. We will be certain about it only after the completion of a full-fledged detailed study of the Upper Karnali Storage project. Even in case these two projects are not outright mutually exclusive of one another, it would not be justifiable to implement the simple diversion project. It is the opinion expressed in the pre-feasibility report of the study carried out under the aegis of the World Bank. The excerpt from that report is given below.

Even when assuming that the KR 1 A run-of-river project (simple diversion project) is a sunk cost, it will be seen that a single large power plant (4180 MW) associated with the major storage project is less costly than the combined cost of smaller plant at the same location (3532 MW) and a second power plant at the foot of the storage dam ( 408 MW) discharging directly into the KR 1A run-of-river project head pond. Based on this assessment, it appears that the later development of the major hydro storage project at Site KR 1 would cause the KR 1A run-of-river project to be effectively discontinued. There may be limited opportunity for secondary energy generation during the periods of spillage.

Advice From Donor Agencies

Nepal should always be very grateful to donor countries and institutions for their valuable assistance in development of our water resources. At present Nepal urgently needs to be helped to establish close relationship with various leading foreign institutions working in the field of water resources engineering. Such relationship would provide us opportunities to be constantly guided in proper planning and implementation of various programs, as a result, our country would not go wrong in taking decisions in the genuine interest of our people. Institutions like the ICIMOD could also be directed to play more active role.