Light at the end of hydropower tunnel

November 9 | Kuensel
By Tshering Dorji

After considerable hiccups, controversies and surprises, hydropower projects in the country are envisaging a light at the end of the tunnel.

The hydropower cooperation between Bhutan and India has resulted in fruition of four hydropower plants and a power generation of more than 2,100MW.

“While the two countries have explored various areas of cooperation including science and technology and fintech, hydropower will remain an important part of Indo-Bhutan story,” said Indian Ambassador to Bhutan, Ruchira Kamboj.

Clarifying on the issues that “often do not make headlines in the local news,” Indian Ambassador to Bhutan, Ruchira Kamboj said hydropower development is a bilateral project and that every decision is taken jointly based on mutual understanding.

At the administrative level, she said a chairman, who is the economic affairs minister, heads a project and a managing director who is an Indian heads the management. The joint managing director is a Bhutanese and every technical committee and empowered groups have equal representation from both sides. Neither of the sides, she said cannot be isolated and whipped for the setbacks.

“When two friends sit down and talk on the table, they always find a solution that is acceptable to both,” Ambassador Ruchira Kamboj said. “There is a lot of trust and confidence. We have each other’s goodwill at heart and this is the most important aspect.”

For instance, she said the Bhutanese side might have higher expectation on Mangdechhu tariff while the Indian side may differ. Arrangements like providing Rs 1 billion outside the tariff, she said, is a classic example of mutually beneficial terms. The Ambassador informed that the Rs 1B has already been released.

On the concerns of the impact on external debt from cost and time overrun, she said, there is nothing two friends cannot solve. Further, she highlighted on the World Bank-IMF joint analysis on country’s external debt that declared Bhutan at a modest risk of debt distress since hydropower loan pays for itself.

The positive side of the cooperation, she said, is often overlooked. Citing an example, the Ambassador said that more than 95 percent of the regular workforce is Bhutanese in all the three projects of Punatsangchhu I, II and Mangdechhu. Punatsangchhu I and II, alone, have spent more than Nu 1B on corporate social responsibility and infrastructure development in the communities, which includes roads, tunnels, hospitals, schools and conservation projects.

Future of hydropower projects

Ambassador Ruchira Kamboj confirmed that the mega reservoir project of Sunkosh will be implemented through inter-governmental (IG) model.

Sources from the local authority earlier said that there has been some disagreement with regard to Sunkosh with Bhutanese side pushing for IG modality and Indian side lobbying for a joint venture.

However, the Ambassador said that this is a misconception and that it would be wrong to use the term ‘disagreement.’ She said that views are being exchanged and that until a mutually acceptable decision is arrived at, there is no disagreement.

Sunkosh, she said is a first of a kind. So far, three rounds of discussions have been held revolving around the governance structure and financing modality.

“Sunkosh will be IG plus because of the sheer size of project,” the Ambassador said.

Mangdechhu, she indicated is the epitome of successful IG model project, which has been completed in stipulated time and cost.

As of October 31, the project has already generated 1,077 million units (MU) of energy amounting to a bill of Rs 4.44B. Presently, the operation has been taken over by the Druk Green Power Corporation and the plant has already achieved 36 percent of designed annual energy generation in period of just three months.

Based on the information from project authority, the Ambassador said that the plant will also generate additional 10 percent of the energy, 3.3 billion units against the original capacity of 3 billion units.

While the Mangdechhu plant has been experiencing some teething issues like oil spillage and leakage, Ambassador Ruchira Kamboj said experts from BHEL have sorted out the issue. “I was told that this kind of teething problems are normal in large newly commissioned projects,” she said.

Because of the water discharge, the project currently is spinning two of its turbines and by June, it is anticipating to run all the four units.

After the joint empowered group meeting in Delhi last September, the Ambassador said that Punatsangchhu II has come up with a clear time line and setbacks have been studied.

It is expected to commission the first unit by October 31, 2021 and full commissioning within 2022. The project was disrupted after a flashflood hit the site couple of months back, washing away equipment and disrupting work.

To overcome the setbacks, the Ambassador said the joint group has decided to release advance money to contractors so that the works are not hampered. The project has also come up with a clear time line to fill the cavity and restore the works in the downstream surge gallery, which collapsed a year ago. As of last month, 85 percent of the physical progress has been achieved.

With regard to the Punatsangchhu I, which is the most challenging project for both governments, a concrete and holistic solution is expected in a couple of months. The Ambassador said that monitoring process has become vigorous and meetings more regular than past.

As for the lone JV project, Kholongchhu, the concession agreement is yet to be signed. The problem surfaced because of the Indian guideline on cross border trade of electricity which has been now resolved.

While few JV projects of Chamkharchhu and Wangchhu have been approved by the GoI in 2014, the Ambassador said that focus at the moment is to expedite Kholongchhu and finalise Kuri-Gongri which would pave way for future cooperation in hydropower sector.

At a time when India is talking about surplus power and tapping wind and solar energy, the Ambassador assured Bhutan’s access to energy market in India.

“Remember we are friends,” she said.

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