Let a Thousand Village-Hydros Bloom
The Nepali government should relinquish its hold over small-scale hydropower and leave the arena free for more efficient consumer-run schemes.
In the upper reaches of the Kali Gandaki gorge, north of Annapurna Himal, there are micro-hydropower plants within an hour’s walk of each other. They serve five villages in Tharkot, Muktinath and Thong together generating 60 kW of electricity. These plants are owned by the villagers and were constructed at their initiative — with door to door collection, voluntary labour, as well as subsidy from outside organisations and the government and loans from the Agricultural Development Bank (ADB/N).
Micro-hydro (up to 100 kW) and mini-hydro (up to 1000 kW) schemes were first put up by the Small Hydro Department of the NEA in the early 1980s to serve district headquarters and other major hill townships. In 1984, micro hydropower was delicensed, allowing villagers to build their own units and charge their own rates. The following year [ADB/N] came out with a programme to subsidise village-level hydro-electric schemes by up to 50 per cent (although the granting of the subsidy has been irregular). Today, there are about 20 operating small hydro schemes built by the NEA and over 70 smaller units built privately, such as at Jharkot, Muktinath and Jhong.
It is these smaller non-NEA electrified hamlets that show the way towards finally utilising Nepal’s hydro-power potential for the benefit of its villagers. The experience of the past decade indicates that the government NEA to be specific, should relinquish its hold over all small-scale (and not just micro-) hydro-power development and leave the arena free for cheaper, more efficient and better managed consumer-run schemes. As the rural consumer’s needs grow, the government must allow private sector entrepreneurs to build into the mini-hydro range (and beyond). More than 50 years ago, another mountainous country with a large rural population, Norway. was electrified through rural hydroelectric cooperatives. There is no reason why Nepalis should not follow the Norwegians.
The problem with NEA-installed micro-hydro schemes is that they come as outright grants. As long as the government, with or without foreign aid, insists on gifting hydro-power schemes to villages, only the communities with political leverage can benefit. District headquarters, for example, have no incentive to work to get their power. They will get it first, anyhow, as funds become available, at the cost of villages which lie in the political backwaters.
Centralised control does not allow local communities to demand or initiate projects. Instead, NEA-run projects are unable even to tap voluntary labour for work which is ostensibly for the villagers’ own good. The cost of Kathmandu-led projects are alarmingly high. When the government is willing to foot the bill with foreign aid, it is in no one’s interest to keep construction costs low or to use better designs and more appropriate technologies. Far from contributing labour and local materials, some villagers who benefit from NEA schemes have been known to demand compensation for allowing power lines to pass through their land. The NEA units are also characteristically over-staffed. Salaries are not dependent upon the plant’s income, and the Authority pays a subsidy of NRs 4,000 (U$ 133) per kW produced in its small hydro plants.
The cost of NEA’s micro-hydro projects, at current prices, averages around US 8,000 per kW produced. Village-owned and ADB/N financed hydro schemes, on the other hand, have averaged about US 1,500 per kW. This has been possible because the village entrepreneurs and Nepali hydro-power companies use appropriate technologies and local energy for construction and components manufactured in Nepal.
Even in the most cost-efficient, villager-driven micro-hydro project, the connection cost is about U$ 160 per household for lighting and U$ 320 if there is enough power to cook. The government would never be able to electrify rural households at these rates. However, where there is a determined community that is willing to pay for, say, half of the amount, it reduces the necessary subsidy and also allows for self-selection of the most organised and determined villages.
Since power generation requires the use of water which is invariably already being used in the community for a number of purposes, the villagers need to be in agreement that a proposed scheme is worthwhile. There are questions of displaced ghattas, fixing of irrigation schedules, compensation for land used by the power house, and so on. These are much better negotiated and settled within the community, rather than through the diktat of a central authority.
The ability of Nepali communities to order their own hydro cures a number of the ills that beset NEA’s efforts. At the village level, there is commitment and initiative; there is constant oversight over the contractor’s work; there is voluntary labour. Questions of water rights and compensations are internally debated and resolved, in much the traditional fashion. Flexible tariff allows reasonable payback on the scheme and optimises the use of the hydro resource by improving the load factor.
In the end, it is not realistic to expect NEA,which has to look after the national grid and hundreds of megawatts of power, to be able to sort out the many minor issues of water rights and sharing of resources demanded by a small 25 kW scheme. NEA’s tariff scheme is completely unrealistic when applied to village micro-hydro schemes. Innovations like the flat tariff (fixed price per month for a set number of watts) favoured by village-owned hydros are not available on NEA-run schemes. The flat tariff encourages customers to spread out their load instead of concentrating them at fixed times. Heat storage cooker technologies (“Bijuli Dekchn coupled with flat tariffs can be effective in utilising small amounts of power over long durations.
LIGHT IN THE COW-SHED
In the past, the bright lights of the city attracted young villagers away from their farms and homesteads. Today, in Nepal, the bright lights can be brought to the villages, with indigenously produced micro-hydro technology.
Naturally, villagers are initially excited by a 25-watt light-bulb in the cow-shed, and the ability to do away with batteries for their radios ‘and tape-recorders. But where it works, village hydro-electricity is also beginning to fulfill the more important roles expected of it, such as reducing fuelwood consumption and powering small industries.
With the advent of heat storage cookers and the flexible tariff that is possible with “decentralised hydro”, it is very likely that Nepal’s hydropower potential will finally assist in improving the rural quality of life. This is not possible through expensive power provided by connecting villages to the national grid. Neither is it possible through village hydro Financed, built and controlled by NEA in Kathmandu, The only way ahead is for NEA to leave development of micro- to small-hydro up to the initiative of the rural folk themselves.
Pandey works for the Intermediate Technology Development Group in popularising micro-hydropower in Nepal.