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| OPINION |
Donor's Meetings And Water Resources By AB Thapa Foreign assistance is
playing a crucial role in Nepal’s development.
At present many countries are generously
providing technical as well as financial
assistance to Nepal to fight poverty and
underdevelopment. Despite such foreign assistance,
lately the pace of development in Nepal
has been very slow. There is already a
need to review, very carefully, our recent
performances to speed up our future development
efforts. Various donor countries and international
development agencies should also come to the
assistance of our country to identify the
problems that impede our development efforts
and to find their correct solutions. Water resources is the
most important sector from the view point of
utilization of the foreign assistance. Greater part
of the foreign assistance is now being used
in implementation of the projects to utilize
our water resources. In future we
could make a big stride in socio-economic
development of our country if our water
resources sector plans are handled with great
care. Unfortunately, we are not at all
seen to be serious about wanting to
give due importance to handling properly water
resources sector . The fundamentals of
basic water resources engineering science are
often outright ignored in taking decision to
implement water resources projects. As a result,
many of our water resources projects, instead
of benefiting our country, are proving to
be big liability to the nation. Nowadays,
we often try to attribute slow progress
in our country’s socioeconomic development
to various vague social factors over
which we have little control to ward off
external criticism but in most of the
cases such explanation would be completely
misplaced. Our own mismanagement in handling
development activities could be the primary
cause of virtual stagnation of our country’s
economic growth.. It is reported that
very soon the next meeting of the donors
is going to be held in Kathmandu. This
meeting reminds us of the Aid Nepal Consortium
meeting held in late 1970s in Paris.
Implementation of the Kankai Multipurpose Project
was at the top of the agenda to be
discussed at that meeting. The Kankai
Multipurpose Project has set a very good
example of how donor agency and the government
could work together to reshape the scope
of any big project in the interest of aid
recipient country. Kankai Multipurpose
Project The detailed feasibility
study of the Kankai Multipurpose Project was
made under the financial assistance of the
German Government ( Executing agency was GTZ ) by
Germany’s famous engineering institution, SALTZGITTER
which was inaugurated before the Second World
War by Herman von Goring, Third Reich
Field Marshal. We were invited to
participate in the meetings to be held in
Germany to finalize the draft final report of
that project which had been circulated to
various donor agencies well ahead of our
arrival. After a careful study of the
project reports presented in several volumes which
were provided to us upon arrival, we found
that there is a need to make
substantial modification to its design concept
if the project is to be really
attractive to be taken up for implementation.
As a result of such modifications the
total project cost could be brought down
from around US $ 300 million to just
about US $ 170. Despite such modifications, the
installed capacity of the hydropower station as
well as the total area of the lands
to be brought under irrigation could
remain unchanged. Consultants from the SALTZITTER
also had good justification in defense of
their design concept. In course of discussions
in the joint meetings held at GTZ office
in Frankfurt, the head of the GTZ for our
region Mr. Kreshar threw his weight in
support of the modifications proposed by me.
Finally, it was decided to revise the
feasibility report. We were asked to discuss
matters related to generators and transmission
with Siemens at Erlangen near Nuremberg, and
the matters related to turbines with
Voith at Hidenheim. Aid Nepal Paris
Meeting Consultants from the
SALTZGITTER completed the revision of the
feasibility report of the Kanaki Multipurpose Project
within the next few months. The revised
feasibility report was sent to the donor
agencies participating in the Aid Nepal Meeting.
Among the recipients of the report were the
ADB, KFW etc. The report produced a storm
of controversy. The SALTZGITTER consultants were
blamed for having manipulated the findings of
the feasibility study because the draft
feasibility report distributed earlier and the
final report did not match up. Nobody was
prepared to accept that the total project
cost could vary in such a wide
range. Everyone believed that the consultants
must have tampered the actual findings of
the feasibility study. Experts from the KFW
were at the forefront of those vehemently
condemning the SALTZGITTER consultants. It took quite some
time for those involved in the implementation
of the Kankai Multipurpose Project to be
fully convinced that the consultants of the
SALTZGITTER were very sincere in presentation
of the final report. The Asian Development Bank (ADB)
was assigned to coordinate the implementation of
the Kankai Multipurpose Project on behalf of
the donors. Experts from the ADB had
doubts in their mind almost until the end
that the consultants must have manipulated
the Kanaki Multipurpose Project report. Dr. Kunio
Takase, Deputy Director of the ADB who
was about to come to Nepal heading the
team to appraise the Kankai Multipurpose Project
said about it to me. I told
him that in reality I was the main
culprit in the controversy over the Kanaki
Multipurpose Project feasibility study report. I
explained him the whole story. The ADB mission was
about to arrive in Kathmandu within the next
few days to appraise the Kanaki Multipurpose
Project. Suddenly events took a dramatic turn
at the very last minute. Some legal
experts in the ADB raised water right
issue. The departure of the ADB mission to
appraise the Kankai Multipurpose Project was
postponed indefinitely. Resolution of this new
problem was not sighted in near future. As a
result, Nepal decided to transfer the funds
allocated for implementing the Kankai Multipurpose
Project to Marshyangdi Hydropower Project. Implementation
of the Marshyangdi Hydropower Project also
provides a good example how the effectiveness
of any project can be greatly enhanced
if those who represent the donors and the
Government work hard in the interest of
aid recipient country. Marshyangdi Hydropower
Project The detailed design of
the Marshyandi Project had already been
completed. The tender documents were ready for
distribution. At that stage I had joined
the Water Resources Ministry. I started completely
independently without spending a single
penny of the government money the general
review of the design of the Marshyangdi
Hydropower Project within the Ministry. I did
this job during my spare time. The Lahmeyer
International GMBH from Germany was the
firm assigned with the approval of the donors
to provide consulting services to the
Marshyangdi Hydropower Project. At that time the
installed capacity of the hydropower project
was considered to be 63 MW. I was surprised to
find that the proposed size of the
delivery tunnel of the hydropower was
overestimated. The size of the tunnel could
be easily reduced by about 25%. As a
result, the civil works cost would have
been significantly reduced. My calculation
sheets were sent to the head office of
the consulting firm in Frankfurt for recheck.
Mr. K.B. Chand, who few years back
became the Secretary to the Ministry of
Water Resources, virtually performed the role of
liaison person in the exchange of
correspondences between myself and the head
office of the consulting firm in Frankfurt. At the
beginning the consultants disagreed with my
calculations. After a series of two way
communications they gave in. Instead of
decreasing the size of the tunnel, they
proposed to raise the installed capacity of
the Marshyangdi Hydropower Project from 63 MW
to 69 MW. I agreed to their
compromise proposal. After this event I
had joined the Royal Nepal Academy of Science
and Technology ( RONAST ). Later on I found
that the consultants must have taken very
seriously my findings. Once they were convinced
of the accuracy of my calculation they
did not limit the capacity of the Marshyangdi
Hydropower Project merely at 69 MW. They
increased the total capacity of that hydropower
project to 75 MW. I was truly shaken
by the sincerity of the consultants. Present Laissez-faire
Approach In recent years our
power sector has been thrown into a complete
disarray. Private developers are virtually given
free hand to do as they wish. The task
of regulatory body even now is nothing
more than a mere formality. The 60 MW Khimti
hydropower, the first project in private sector,
has opened a Pandora's box. The Khimti
project had disastrous consequences for the
economy of the Nepal Electricity Authority. The Khimti hydropower
project operating at a very high head of about
650 meters was seen in the past as one
of the most attractive projects for the
generation of cheap electricity. The cost of this
project was originally estimated at US $ 60
millions but astonishingly, it was jacked up
to US$ 140 millions to calculate the selling price
of the electricity to the NEA right under
the nose of the Asian Development Bank which
provided credit to the private developer to
implement this project. It is virtually an incomplete
project The storage reservoir, even if it is
just sufficient in volume to hold enough water
for operating the power station at full capacity only
for few hours in the evening when the demand
for electricity is the highest, is the most important
component of any hydropower. In the absence of
such storage reservoir the actual value
of even the firm energy would be far too
small. Unfortunately the Khimti Project does not
have a daily storage pond, as a result, the
Khimti project is forced to operate at
constant load throughout the day and night. Under
such circumstances the true per unit (KWh) value
of the firm power of the Khimti
by comparision with other
power stations like the Marshyangdi, Trisuli
etc could be only about half. The installed capacity of
the Khimti project is 60 MW against its firm
capacity of only about 18 MW at the time
of maximum power demand, as a result this
project produces an enormously large volume of
seasonal energy. The seasonal energy procured
from the Khimti is completely wasted though
NEA is obliged to pay about
US $ 9 million per annum for such
seasonal energy. On top of it the NEA had
to build at its own cost very expensive
high voltage 120 KV transmission lines from
Khimti to Katmandu almost exclusively for
the supply of seasonal energy, which anyway
would be totally wasted. A low
voltage transmission lines at far less
investment would have fully served the purpose
of transmitting the entire Khimti firm power. Many developers
were quick to take full advantage
of the precedence set by the Khimti
project. Some of them have even started
to supply electricity after the completion of
the hydropower construction. Perhaps at present the NEA
is forced to pay private developers about
40% of its total revenue for the
electricity it purchases from them, whereas the
effectively used volume of such power procured from
the private developers could be only about 10%
of the NEA’s total electricity sale.
The Melamchi
Mismanagement It has been clearly
stated in the UNDP supported Melamchi
project study report that around the time
2011 (almost at the same time when the Melamchi
Project is expected to be commissioned ) the total
system demand (in Kathmandu valley) is expected
to reach the total supply from in-valley
surface sources and Melamchi. After that the supply
from the next stage of the development of the
Melamchi will be required. This entails the diversion
from the Yangri and Larke. Unfortunately,
despite such findings of the feasibility study
the concerned government agencies did not
hesitate to lease the Yangri and Larke
rivers to private developers for the
construction of hydropower. Surprisingly none of
the donor agencies including the Asian Development Bank
appeared to have raised their voice against such
decision. Despite the eagerness of the donor
countries and international development institutions
to help Nepal in every possible way
in the task of providing essential services to
common people at affordable price, some of
their local representative are often not seen
concerned for the welfare of the common people.
They do not appear to be keen on
handling the Melamchi project with care.
As a result, the Melamchi project
could prove to be a white elephant for
our country if we failed to rectify our mistakes
in time. It has nowhere been
clearly explained why it was allowed to drop
the hydropower component of the Melamchi project. .
The UNDP supported feasibility study report of
the Melamchi project clearly points out that
the net increment in investment ( the
cost of the powerhouse located near Sundarijal
with electromechanical equipment) needed to implement
the hydropower element is relatively small as
the intake headrace tunnel and penstock are
already in place for conveying water to
the treatment works of the Melamchi project.
The UNDP report has concluded that the
power station would be worth constructing
and could make a contribution to reducing
the cost of drinking water to Kathmandu
residents. It is still not too late to
reintroduce the hydropower component. (Dr. Thapa writes on water
resources) |
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