Kathmandu, – A major step forward has been made in Nepal’s energy sector as the 216-megawatt Upper Seti Hydropower Project, planned for construction in the remote Bajhang district of Sudurpaschim Province, has officially reached financial closure. The project, located in Wards 4 and 5 of Saipal Rural Municipality, is being financed under the leadership of Kumari Bank Limited, with NMB Bank Limited serving as co-lead.
The financing deal brings together a strong consortium of commercial and development banks, including Machhapuchchhre Bank, Hydro Electricity Investment and Development Company (HIDCL), Laxmi Sunrise Bank, Nepal Investment Mega Bank, Prabhu Bank, Nepal SBI Bank, NIC Asia Bank, Agricultural Development Bank, Lumbini Bikas Bank, Shangrila Development Bank, Kamana Sewa Bikas Bank, and ICFIC Finance.
The agreement was formally signed in Kathmandu on Friday between Kumari Bank and the project’s developer, Samriddhi Energy Limited. Kumari Bank CEO Ram Chandra Khanal and Samriddhi Energy Chairman Shailendra Guragain signed on behalf of their respective organizations.
Semi-Reservoir Design Prioritizing Sustainability
The project follows a financing structure of 70 percent debt and 30 percent equity. All essential preparatory work—such as financial evaluations and due diligence—has already been completed, according to the project’s backers.
The Upper Seti project is designed as a semi-reservoir-based run-of-river system, with a peak generation capacity of up to 4.5 hours. It features a design discharge of 34.1 cubic meters per second, with a gross head of 758.9 meters and a net head of 735.6 meters.
Environmental safeguards are also built into the plan. To maintain ecological flow and protect downstream biodiversity, the project will continuously release at least 1.41 cubic meters of water per second into the Seti River throughout the year.
Construction Timeline and Kumari Bank’s Expanding Role in Energy
The project’s power purchase agreement (PPA) was signed with the Nepal Electricity Authority in July 2023 (Shrawan 2080 BS), and a generation license was granted in April 2024 (Baisakh 2081 BS). Construction is scheduled to be completed within five years, with commercial power generation expected by mid-July 2031 (Ashad 31, 2088 BS).
Kumari Bank has become a prominent player in Nepal’s renewable energy financing landscape. Currently, the bank is involved in more than 65 hydropower and solar energy projects across the country. With over NPR 70 billion in investment commitments, these projects collectively represent more than 2,000 megawatts of installed capacity—many of which are either operational or under active development.
The Upper Seti Hydropower Project is seen as a transformative effort for the Bajhang district, promising both local infrastructure development and a significant boost in clean energy production. Its successful execution could mark an important milestone in Nepal’s journey toward long-term energy security and sustainability.
