ASIA PACIFIC
ASIA PACIFIC
$ 20 Million Grant to Spur Private Sector Solar Power Investment in Nepal
Nepal is to receive a $ 20 million grant to spur private sector investment in utility-scale solar power . The funding should ensure installation of at least 25 megawatts ( MW ) of solar power by 2018 but , more importantly , will provide a business model that can be replicated and scaled up elsewhere in the energy- strapped South Asian nation .
“ Providing some financial security to the private sector should draw more private investment into this critical sector in Nepal and , in doing so , reduce pressure on government finances . And once the private sector better understands the Nepal solar sector , I would expect them to seek investment opportunities elsewhere in Nepal or indeed the region .”
- Aiming Zhou , Senior Energy Specialist at ADB ’ s South Asia Regional Department
N
epal has been suffering chronic power shortages , with peak demand of 1,444 MW far outpacing installed capacity of 885 MW . Only 65 % of the country ’ s households have access to electricity . Hydropower has , so far , been a mainstay of the country ’ s clean energy supply but solar power is an ideal complement , particularly during the lowwater season . Until now , however , private sector investment has largely been in micro- and minigrid solar power , with utility-scale plants of 4 MW or more attracting little private sector attention . Now , companies will be able to bid to develop solar systems through an international competitive bidding process , with power purchase agreements awarded on the basis of the best offtake prices . The funding under the grant will be payable on the first day of operation of the solar system , up to end June , 2022 . Bidding is expected to start in the first quarter of 2017 and last around 6 to 12 months .
The $ 20 million grant is being financed by the Scaling Up Renewable Energy in Low Income Countries Program ( SREP ) of the Climate Investment Funds ( CIF ) administered by the Asian Development Bank ( ADB ). It will form part of the $ 440.50 million South Asia Subregional Economic Cooperation Power System Expansion Project , which kicked off in January 2015 . ADB , based in Manila , is dedicated to reducing poverty in Asia and the Pacific through inclusive economic growth , environmentally sustainable growth , and regional integration . Established in 1966 , ADB in December 2016 will mark 50 years of development partnership in the region . It is owned by 67 members — 48 from the region . In 2015 , ADB assistance totaled $ 27.2 billion , including cofinancing of $ 10.7 billion .
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EQ December 2016 www . EQMagPro . com