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WANDU – In just seven months since its launch, the 118 MW Nyikahu Hydropower Project (NHP) has earned about Ngultrum 973 million from the sale of about 266 million units of electricity.
NHP started exporting electricity to India on January 25 this year. The project aims to generate 491 million units of electricity and generate revenue of about Ngultrum 1.6 billion per year.
As of July, the project had achieved about 50% of its power generation target and 61% of its revenue target.
NHP supplies power to three major buyers: 80% to the Power Trading Corporation of India (PTC) and 20% to the Bhutan Power Corporation (BPC) and the Indian Energy Exchange.
The plant also supports the Mandechu Hydropower Project (MHP) by releasing water, increasing water flows for power generation and benefiting the MHP. The Nyikahu and Mandechu dams are located in the same river basin, with Nyikahu upstream and Mandechu downstream. The revenue from this arrangement is shared equally between the two projects.
The tariff of electricity is Nu3.3 per unit for PTC and Nu3.890 per unit for BPC, which is quoted to the highest bidder through competitive bidding on the Indian Energy Exchange every 15 minutes.
As of July, NHP has sold 155.674 million units to PTC, generating revenue of Nu 513.725 million, sold 37.437 million units to BPC, generating revenue of Nu 146.927 million, and sold 26.372 million units on the Indian Energy Exchange, generating revenue of Nu 144.149 million.
The additional water supply to the MHP contributed 46,326,000 units of water, generating an additional 168 million nunatrum in revenue for the NHP.
NHP is funded mainly by loans from the Asian Development Bank (ADB) and Indian commercial banks, with $120.5 million secured through the ADB.
The Asian Development Bank provided a concessional ordinary capital resources loan of US$25.25 million with a repayment period of 32 years, a grace period of 8 years and an interest rate of 1%.
In addition, $70 million was provided in the form of a general capital resources loan at an interest rate of 5.6%, and $25.25 million was provided in the form of a grant.
Two Indian commercial banks, the State Bank of India and the Export-Import Bank of India, provided a loan of US$58.821 million for the project with a term of 15 years, including a five-year grace period and a 10-year repayment period, at an interest rate of 12.15%.
Upon completion of the project, the cost increased by 36 per cent, with the final expenditure reaching about N15.99 million, while the approved amount was about N11.67 million.
“The construction of NHP faced many challenges which led to cost escalation and delayed completion date. The three major factors for cost escalation and delays were geological issues at the site, cash flow and the pandemic,” said Sujan Rai, interim CEO of Tangsibji Hydro Energy Limited.
The project was originally scheduled to be completed in 2019, but the deadline was extended first to 2021 and then to 2023.
Sujan Rai said that during the monsoon season, power generation was higher due to increased rainfall. “If the rest of the monsoon season continues to bring more rain, the full-year target can be achieved.”
In January, the plant produced 3.8 million units of electricity. Over the next few months, output increased steadily, reaching 12.2 million units in February and 14.2 million units in March. By April, output had risen to 18.3 million units and continued to grow to 24.9 million units. Unit in May.
The plant’s production reached its highest levels in June and July, with 52.9 million units produced in June and 93.4 million units produced in July.
According to the Asian Development Bank’s April outlook, the operation of the new Indian Railways will significantly boost economic growth, complementing an expected 6.5% growth in the services sector and a 2.5% rebound in industry (excluding construction).
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