The government is pursing water resources development in Nepal from three different approaches:
- To develop small and decentralized Hydro power projects to meet the local demands in remote and isolated regions of the country.
- To develop medium sized power projects to meet the national demand with in national grid including surplus for export and to develop local capacity.
- To develop large-scale multipurpose projects to meet the regional demand for food, energy and food control.
With this vision, the government had adopted the Hydro Power Development Policy of 2001 for attracting both local and foreign investment.
The following are the main highlights of this policy:
Objectives of Hydro Power Development Policy in Nepal
- Ministry of Water Resources (MOWR) has the policy to generate electricity at low cost by utilizing the water resources available in the country.
- Ministry of Water Resources (MOWR) has the policy to link electrification with the economic activities
- Ministry of Water Resources (MOWR) has the policy to render support to the development of rural economy by extending rural electrification and
- Ministry of Water Resources (MOWR) has the policy to develop Hydro power as and exportable commodity.
Hydro Power Development Policy for internal electricity market:
For private sector operated Hydro Power projects with capacity up to 1 MW and not linked to the grid, the independent Power Producer (IPP) may sell and distributed the electricity by determining the tarrif rate of the electricity on its own.
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