Karnali Chisapani Project back in news

The Karnali Chisapani Hydroelectric Project is back in the news with the government preparing to entrust the Nepal Electricity Authority (NEA) with the responsibility of a new study of the project. 

The 10,800 MW project stands as Nepal’s most ambitious hydroelectric plant to date and will be constructed on the Karnali river. Prime Minister Pushpa Kamal Dahal while addressing the program to mark the 38th anniversary of the NEA said that the government is preparing to develop the Karnali Chisapani Project with the involvement of the NEA. 

According to Energy Ministry officials, the government will soon make a formal decision to hand it over to the NEA for further study. Madhu Prasad Bhetuwal, spokesperson at the Ministry of Energy, Water Resources and Irrigation, said that the responsibility for further study of the Karnali Chisapani Project will be given to the NEA through a formal decision. “A formal decision will be made soon,” said Bhetuwal. 

It's been 57 years since the first feasibility study of this project was done in the 1960s. The Japanese company Nippon Koei Co Ltd (NK) did a feasibility study between 1962 and 1966. The study proposed the development of a 1,800 MW run-of-the-river project through the construction of a tall dam at the Chisapani Gorge. 

In 1968, the Snowy Mountain Hydroelectric Authority (SMHA) of Australia further evaluated the finding of the Nippon Koei and recommended enhancing the installed capacity of Karnali Chisapani to 3,600 MW. 

The most recent feasibility assessment for the project was initiated in 1986 and finalized in 1989. A consortium known as Himalayan Power Consultants (HPC), composed of Acres from Canada, Ebasco USA, Shawinigan from Canada, and SNC from Canada, conducted this study, determining the project’s capacity to be 10,800 MW. 

While the project has been in the news many times in the past, successive governments failed to take the project into the implementation stage.

The 2016/17 budget had announced the development of the Karnali Chisapani Multipurpose Project as a tripartite project involving India and China. And, the White Paper issued in May 2018, during the then Energy Minister Barsha Man Pun's tenure talks about conducting a detailed study of the project within five years. 

The planned new study, according to Bhetuwal, is being mulled to ascertain the water flow of the river, and what kind of infrastructure is required. “The issues such as the market for the electricity generated from the project should be studied,” he said. 

The 1989 study had shown that Rs 500bn would be needed to develop the project and around 60,000 people would be displaced.

Earlier studies have shown that Karnali Chisapani Project is technically feasible and financially viable, as a multipurpose project with irrigation and electricity as the main benefits from the project. 

According to Bhetuwal, discussions will be held with India for the construction of this project. “After the construction of this project, not only Nepal will benefit but India will also benefit greatly from the project,” said Bhetuwal. “Therefore, this project will have to be made in cooperation between the two countries. Therefore, we will discuss this further with India.” 

Last year, India's Adani Group also showed interest in this project. However, he said, there is no discussion about it now. The representatives of the Adani Group flew to Kathmandu in April 2022 and met the senior officials of the Prime Minister and Council of Ministers’ Office, Investment Board Nepal, National Planning Commission, Ministry of Energy, and NEA. The Adani Group had shown interest in the projects of the Karnali basin including Karnali Chisapani.