Nepal Prepares to Extend RCOD for Hydroelectric Projects

Nepal Electricity Authority has prepared to extend the RCOD (Commercial Operation Date) for hydroelectric projects that have signed a Power Purchase Agreement (PPA) but have not yet started commercial production.

The authority’s board meeting on Ashar 32 decided to extend the deadline for projects that have not yet started commercial production, based on their physical progress, RCOD status, and fulfillment of PPA obligations.

The meeting also decided to categorize the projects into four groups based on their progress. Group ‘A’ will include projects that have not yet reached their RCOD and have completed or will complete their PPA obligations on time.

Group ‘B’ will include projects that have reached their RCOD but have not yet been connected to the grid due to delays in transmission line or substation construction. This group will also include projects that have been affected by unforeseen circumstances and have obtained RCOD extension approval.

Group ‘C’ will include projects that have not yet reached their RCOD and have not completed their PPA obligations, or have less than 25% physical progress. Group ‘D’ will include projects that have reached their RCOD but have not completed their obligations or have had their survey and production licenses revoked.

The authority will measure physical progress based on the 2071 guidelines. For solar projects, progress will be measured based on panel procurement agreements, land acquisition, and mounting structure and foundation construction.

The authority will provide necessary instructions and monitoring to projects in Group ‘B’ to ensure timely completion. Projects will be reassessed within six months and may be re-categorized if necessary.

Projects in Group ‘C’ will receive a ‘Notice of Default’ and may have their PPA revoked if they do not provide a satisfactory explanation or show improvement.

The authority’s decision is expected to bring more transparency and accountability to the management of hydroelectric projects, which have been delayed for various reasons.