The Cabinet Committee on Economic Affairs (CCEA), chaired by Hon’ble Prime Minister Shri Narendra Modi has approved the investment of Rs. 5792.36 crores (Cost to Completion) for 669 MW Lower Arun Hydro Electric Project (LAHEP) at levelized tariff of Rs. 4.99 per unit.
The Committee has also accorded Ex-post facto approval for Special Purpose Vehicle SJVN Lower Arun Power Development Company Private Limited (SLPDC), a wholly owned subsidiary of SJVN incorporated in Nepal for implementation of LAHEP. In addition to this, the Committee has also approved the equity investment of Rs.1737.70 crores in SLPDC.
The 669 MW Lower Arun Hydro Electric Project with four units of 167.25 MW each, is located downstream of 900 MW Arun-3 Hydro Electric Project on river Arun in Sankhuwasabha district of the province-1 in Nepal. A tail race development of Arun3 HEP, the project will not have any reservoir or dam and will operate as a Tandem Operation System with Arun-3 HEP. This project is designed to generate 2900 million units of energy annually.
SJVN bagged the project through international competitive bidding and the project is being implemented on Build-Own-Operate and Transfer (BOOT) basis with active support from the Ministry of Power, Government of India. The project shall be commissioned within a span of 60 months from the date of investment approval. The generated power shall be evacuated through under-construction 217 km 400 KV Double Circuit Transmission Line up to Sitamarhi, Bihar.
In benign presence of the Prime Minister of India and Prime Minister of Nepal, the Project Development Agreement of LAHEP was signed between the Investment Board of Nepal and SJVN on 1st June 2023.
SJVN is a key partner and trusted investor in socio-economic development of Nepal. Execution of mega hydro projects is a mutually beneficial endeavor for both nations as it will result in economic growth of India & Nepal. The power generated from this project will be fully utilized in Nepal & Indian Grids and will help in providing grid stability. Besides adding valuable renewable energy to the Grid, the project would also lead to carbon emission reduction of about 26 lakh Tons annually. The Project shall also provide opportunity to Indian contractors to participate in construction besides export of construction material and equipment from India to Nepal. It shall provide employment opportunities to the citizens of both countries and shall improve the bilateral relations between the two countries.
Presently, SJVN is executing three hydro projects namely 900 MW Arun-3, 669 MW Lower Arun and 630 MW Arun-4 HEPs of total 2199 MW in Nepal.
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