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Bhote Kosi



The Bhote Kosi Power Company has put forward a new proposal to seek a 'mutually acceptable' way out of its Power Purchase Agreement (PPA) with the Nepal Electricity Authority (NEA). Bhote Kosi has been embroiled in a controversy for building a power plant that had more capacity than was allowed in its agreement. NEA has refused to pay for the extra power, while the Texas-based Panda Energy which is the joint venture partner has put pressure on the government to amend the license agreement. The joint venture company got an agreement to generate 36 megawatt but put up turbines generating 45 megawatt. Dipak Gyawali, former hydropower minister, had set up an investigation committee under the Power Development Department which had confirmed that the company's turbines were indeed of 45 megawatt capacity. Ever since, Bhote Kosi has been desperate to amend the license agreement. A member of the department says Bhote Kosi is actually generating power illegally at the moment. The government had tried to push a new agreement in exchange for an additional Rs 9 million annually but it was stopped after it became clear that the NEA would be the loser. The disagreement between Bhote Kosi and NEA is over payment for 1.7 million units of electricity over the past three years which would cost $3.5 million. Bhote Kosi's latest proposal would require NEA to pay this final amount and not be required to pay for the extra power in future. In addition, Bhote Kosi has also proposed to take out a clause pegging unit cost increases of six percent annually on the American dollar.



LATEST ISSUE
638
(11 JAN 2013 - 17 JAN 2013)


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