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After a long wait, the 102-megawatt Bhotekoshi Hydropower Project in Sindhupalchowk has started trial production. The project, whose main generator is operated by Chilime Hydropower Company, a subsidiary of the Nepal Electricity Authority (NEA), began production following the successful testing of its transmission line last week, according to Ram Gopal Siwakoti, CEO of Bhotekoshi Hydropower Company.

The trial production began with one of the project’s three turbines. “Since the Bahrabise substation is not yet ready, we have been testing electricity via the Khimti substation on a line connecting it to the power house in central Bhotekoshi since last week,” said Siwakoti. “Despite many challenges, we have now succeeded in generating electricity.”

As work on the Bahrabise substation continues, electricity generated at Bhotekoshi is currently transmitted to the new Khimti substation via a 40-kilometer transmission line. “After a few days of testing, electricity will be connected to the national grid, and regular production will begin,” said Siwakoti, noting that revenue will start once it is linked to the national transmission line.

Construction of a two-kilometer section of the approximately four-kilometer transmission line connecting the project’s switchyard in Bahrabise Municipality-5 to the NEA’s Bahrabise substation in Municipality-3 is underway after reaching an agreement with local residents. The 220 kV single-circuit transmission line is expected to be completed before Dashain. Plans are in place to connect the generated electricity to the national grid via the Dhalkebar substation.

Siwakoti expressed confidence in the project’s trial production, saying it is expected to be 99 percent successful. Last year, a tunnel leak occurred when water was first sent through the 7.5 km tunnel, which runs from the dam in Chakuma, Bhotekoshi Rural Municipality (bordering China), to the power house in Jambu, Bahrabise Municipality.

The project was initiated in 2013 by former CEO Kulman Ghising with a target completion date of 2017. Delays were caused by local disputes, Covid-19, floods, landslides, and earthquakes. “We have brought Bhotekoshi, which was almost a failure, to a production-ready state,” said Siwakoti.

Once in regular production, the project is expected to generate 542.2m units of electricity annually. The NEA will purchase electricity at Rs 8.4 per unit in winter and Rs 4.8 per unit during the rainy season, generating annual revenue of approximately Rs 2.8bn for the company. The cost of electricity generation per megawatt is estimated at Rs 220m due to increased investment. During the dry season, the project will generate a minimum of 35 MW, while production could reach up to 110 MW during the rainy season.

The project’s initial estimated cost was Rs 12.28bn, excluding interest during construction, but the updated cost is Rs 16bn. Delays have resulted in daily interest payments exceeding Rs 5m.

The company’s ownership is split between founder shareholders (51 percent) and common shareholders (49 percent). Founder shareholders include NEA (10 percent), Chilime Hydropower Company (37 percent), Sindhupalchowk Hydropower Company (one percent), Nepal Araniko Hydropower Company (one percent), Sindhu Investment Company (1 percent), and Sindhu Bhotekoshi Hydropower (one percent). Common shareholders include Employees Provident Fund employees (19.5 percent), founding corporate body employees (3.5 percent), lending organization employees (one percent), Sindhupalchowk residents (10 percent), and the general public (15 percent). The company has already raised funds by issuing common shares.

The Nepal Stock Exchange (NEPSE) plunged by 19. 89 points to close at 2, 741. 97 points on Tuesday.

Similarly, the sensitive index dropped by 2. 69 points to close at 473. 68 points.

A total of 10,535,874-unit shares of 323 companies were traded for Rs 4. 43 billion.

Meanwhile, Him Star Urja Company Limited (HIMSTAR) was the top gainer today with its price surging by 9. 98 percent. Likewise, Unnati Sahakarya Laghubitta Bittiya Sanstha Limited (USLB)was the top loser as its price fell by 7. 47 percent.

At the end of the day, the total market capitalization stood at Rs 1. 55 trillion.

The price of gold has increased by Rs 600 per tola in the domestic market on Tuesday.

According to the Federation of Nepal Gold and Silver Dealers’ Association, the precious yellow metal is being traded at Rs 205, 900 per tola today.  It was traded at Rs 205, 300 per tola on Monday.

Similarly, the price of silver has increased by Rs 15 and is being traded at Rs 2, 485 per tola today.

Nepal has been studying hydrogen fuel since 2008. After nearly 17 years of research, the government has begun work on producing green hydrogen fuel. A memorandum of understanding has been signed with South Korean company G-Philos to establish a green hydrogen plant and fuel cell facility in Nepal.

The Investment Board Nepal (IBN) is preparing a detailed project report (DPR) to explore producing hydrogen fuel using around 20 megawatts of electricity. According to IBN spokesperson Pradyumna Prasad Upadhyay, the proposed project is estimated to cost about Rs 6 billion. Initially, only a small-scale production will be attempted, with plans to expand depending on the feasibility study.

The agreement was signed on Thursday by IBN CEO Sushil Gyawali and G-Philos CEO Ga Woo Park. As per the agreement, the company will prepare the DPR within 10 months of receiving a survey permit from the board.

G-Philos had submitted its proposal on April 15 for the establishment, development, and operation of a green hydrogen and fuel cell plant in a public-private partnership model. The 63rd meeting of the IBN decided to grant the survey permit.

Biraj Singh Thapa, a researcher and associate professor at Kathmandu University, welcomed the agreement, noting that KU has been conducting green hydrogen research and even demonstrated a hydrogen-powered car. He highlighted that the Hydrogen Policy 2023, along with tax exemptions on machinery and equipment and a five-year income tax holiday announced in the current budget, has drawn foreign interest in Nepal’s hydrogen sector.

According to the policy, machinery and equipment imported for green hydrogen production are exempt from all taxes and duties. This, Thapa added, is expected to attract both foreign and domestic investors. The 20 MW feasibility study will also assess whether the fuel can be used domestically or exported, and identify a potential plant location.

Kathmandu University established a Green Hydrogen Lab in 2020 to research the use of hydrogen in fertilizer factories, iron ore processing, and as a coal substitute in cement industries. Hydrogen has long been considered a potential renewable energy source, and its production could help Nepal meet its commitment to achieving net-zero carbon emissions.

Several institutions have studied Nepal’s hydrogen potential. Tribhuvan University and Western Michigan University jointly concluded that hydrogen could be produced using hydropower, reducing petroleum imports. The Asian Development Bank carried out a similar study in 2020, while the Water and Energy Commission Secretariat assessed possibilities in 2021. A study in 2022 further explored hydrogen-based fertilizer production.

Globally, countries including India, China, and the United States have already developed hydrogen roadmaps and policies. Nepal’s Hydrogen Policy 2023 also recognizes significant potential for hydrogen and related products from hydropower.

Hydrogen is produced by splitting water into hydrogen and oxygen using electricity. Roughly one kilogram of hydrogen can be extracted from nine kilograms of water, requiring about 50 kilowatt hours of electricity. With abundant water resources and surplus electricity, Nepal is well positioned to produce hydrogen.

Hydrogen can be stored as a liquid, gas, solid, or metal hydride, making it suitable for domestic use or export. Studies suggest that hydrogen could replace at least two percent of Nepal’s diesel imports. Given the size of the domestic diesel market—worth around Rs 71bn—green hydrogen could play an important role in diversifying Nepal’s energy mix and enhancing energy security over the next decade.