A government official said last week that a "review" of the power purchase agreements (PPAs) between independent power producers (IPPs) and the Nepal Electricity Authority was underway, following directives issued by a parliamentary committee. The review comes a few months after the first IPP, Khimti Hydroelectric project (60MW), began supplying power to the NEA. Another IPP, the 36-MW Bhote Kosi, is nearing completion.

The IPPs have not commented on the government\'s recent move to invoke the clause that allows "review of the PPAs in good faith". Privately, however, they say any such attempt will not bode well for new investments in the hydro sector.
According to the PPAs with both Khimti and the Bhote Kosi projects, NEA will have to buy all the power generated at approximately seven US cents, the highest in the region.