Nepal Water and Energy Development Company (NWEDC), the developer of Upper Trishuli I Hydroelectric Project (216 MW), have said they would begin construction works right after signing Project Development Agreement (PDA) and Power Purchase Agreement (PPA) with Nepal Electricity Authority (NEA).

NWEDC is a consortium of Nepali and Korean Companies -- KOSEP (50 percent), DAELIM (15 percent) and KYERONG (10 Percent). Bikesh Pradhanganga, a local entrepreneur, and International Finance Corporation (IFC) holds 10 and 15 percent shares, respectively.

Fourth round of PDA negotiations between NWEDC and NEA is scheduled for Monday. The project site is situated in Haku VDC of Rasuwa.Baburam Bhardwaj, general manager of the project, said they were hopeful that Monday´s negotiation will finalize the PDA reports My Republica.

The government has already extended the project´s license by three times (to a total of 30 months) due to delay in signing PDA.

Keshav Dhwaj Adhikari, spokesperson of the Ministry of Energy, said the PDA template for Upper Trishuli I will be more or less similar to the PDAs of export-oriented projects Upper Karnali and Arun III. According to promoter, the project cost has been revised to US$ 590 million from the previous estimate of $550 million.

As per the project design, the water of Trishuli River will be diverted to the powerhouse through a 9.25 km tunnel. It will have three generation units of 72 MW each. The project will generate 1456.4 GWh of energy annually. The energy generated by the project will be evacuated via the proposed substation of NEA at Trishuli 3B project downstream.

The project has proposed PPA at 6.9 cent per unit with annual escalation rate of 3 percent for the first 10 years of generation. But NEA cannot decide on PPA in US dollar right now, as PPA in foreign currency is under discussion at the Public Accounts Committee (PAC) of legislature-parliament for the past six months.

Project officials said they would allocate 10 percent of the shares in the project to locals of six affected village development committees (VDCs).