KATHMANDU: Banks and financial institutions have recently finalized loan agreements worth Rs 26 billion for two significant hydropower projects, signaling increased investment in Nepal’s energy sector.  

The 49.95 MW Dhanakhola Hydroelectric Project, promoted by Lalupate Hydro Power Company, secured Rs 9.96 billion in financing earlier this week. Mohan Kumar Dangi, the project’s promoter and Vice President of the Independent Power Producers’ Association Nepal (IPPAN) confirmed the involvement of multiple banks and institutions.  

In the Dhanakhola project, shares worth Rs 740 million will be issued to local residents affected by the project, while the operators and promoters are set to invest Rs 1.74 billion.  

Similarly, the 102 MW Upper Marsyangdi I Hydroelectric Project in Lamjung has signed agreements with various banks for Rs 16 billion in funding. This project is being promoted by the Upper Marsyangdi Hydropower Company.  

The promoter claims that Prabhu Bank will donate Rs 3 billion, Global IME Bank will contribute Rs 6 billion, and Laxmi Sunrise Bank will contribute Rs 7 billion. The project is expected to cost Rs 21.4 billion in total, of which 74.77 percent will be covered by banks and the remaining 25.23 percent would be invested by promoters.  

A production license and a power purchase agreement have already been obtained for the Upper Marsyangdi project. It is anticipated that construction will be finished in four years, with an annual energy output of 583.03 GWh.  

IPPAN President Ganesh Karki emphasized the continuous advancements in funding agreements for more hydropower projects. Twenty projects have already obtained funding, he said, and several more are already undergoing negotiations.  

These changes highlight how Nepal's hydropower industry is gaining traction as project promoters and finance institutions collaborate to unlock the nation's energy potential.