Renewable Energy Powers Rural Nepal Into the Future

February 5, 2014


The micro hydro initiative is meeting the energy needs of Nepal's rural communities and powering their economic development.

Umesh Basnet/World Bank

  • The government of Nepal, with the assistance of the World Bank has been helping build micro hydro plants across rural Nepalese communities.
  • The plants are built and run by the communities, enabling sustainability, and bring much-needed electricity that powers industry and businesses.
  • Over 1,000 micro-hydro plants have been built so far in 52 districts. With its inclusive community driven model, the initiative is meeting energy needs of rural communities, and powering their economic development, also serving as an example of how renewable, clean energy harnessed through community efforts can set the world on a path to a cleaner and more prosperous future.

Reaching Darbang in Myagdi district is an ordeal. The rough roads leading from the district capital of Beni are impassable during the rains, requiring you to wade through rivers and perform balancing acts across landslides to get there. So it’s surprising that once you reach there, what greets you is not a sleepy rural village, but a bustling center of economic activity.

The town of Darbang boasts industries including a metal workshop, several furniture manufacturers, a cement block manufacturer, a noodle factory, poultry farms and dairy farms. All these industries have sprung up within the last four years, after the Ruma Khola Micro Hydro Power Plant came into operation in 2009.  

The 51 kilowatt Ruma Khola micro-hydro supplies electricity to 700 households in five villages, including Darbang. This micro-hydro is constructed as part of the World Bank’s support to renewable energy generation in Nepal, implemented through the government of Nepal’s Alternative Energy Promotion Center (AEPC).

Just 100 meters from the micro-hydro power plant is a poultry farm owned by Laxmi Rasalli. 27-year-old Rasalli is raising 300 chickens. She sells most of them in the busy meat shop that she has opened in the ground floor of her home. Electricity is a major requirement for a poultry farm. Chicks need continuous heat and light for 45 days until they grow.

“I could not have started raising these chickens if we didn’t have electricity,” says Rasalli.

Community ownership

The micro-hydro was built, and is run by the community. With encouragement from AEPC, the community came together to build a micro-hydro that could meet the energy needs of five neighboring villages. Incorporating five villages, the community gathered a construction committee consisting of 89 people.

AEPC helped the construction committee with feasibility studies, and technical aspects of construction. The operators and managers to run the micro-hydro were also trained by AEPC. AEPC also makes a grant of Rs. 125,000 per kilowatt of electricity generated by the community.

 “Availability of these grants encourages the community to get together and start work on securing their own energy future,” said Bijaya Wagle of AEPC.

This grant from AEPC, together with grants from the Village Development Committee, and District Development Committee all helped establish the micro-hydro, while the community contributed labor, and received a loan from the Agriculture Development Bank to secure the rest of the resources. The micro-hydro construction committee was in charge, overseeing all aspects of construction, including raising funds, finding labor, and management oversight.

Every month, the micro-hydro raises Rs. 70,000 in utility bills paid by its users. The money raised is used to pay back loans, perform regular maintenance and pay the salaries of the operator on staff.

" I could not have started raising these chickens if we didn’t have electricity.  "

Laxmi Rasalli

45, Poultry Farmer

AEPC support to the micro-hydro extends to transiting it from the construction phase to a management phase. After the plant has been built successfully, AEPC advises dissolution of the construction committee, and the installation of a management committee that oversees the daily operations of the plant.

The nearby towns are bustling because electricity is generating new employment in the industries that have sprung up. To encourage industries, the micro-hydro currently has a minimal flat fee of Rs. 1,000 per month for industries. But demand is high, and the committee is considering charging by unit.

In Darbang, brothers Lak Bahadur and Jug Bahadur Kunwar moved from the remote village of Okharbot, an hour’s walk away from Darbang, to jointly establish the Kunwar Furniture Store, after the micro-hydro came into operation. Today, the brothers employ seven people in their furniture store.

The furniture store runs three motors and various electrical equipment to manufacture furniture. Electricity has improved the quality of their work. “The finishing is better, we can make better designs with electrically powered machines,” says Lak Bahadur.

Creating bustling communities

Electricity has brought about a major change in the villages reached by this micro-hydro. In addition to 22 industries powered through this plant, the town of Darbang boasts a higher standard of living for its residents. People may have a hard time physically accessing the outside world, but they have televisions, and even Internet to connect them to the world.

This micro-hydro project is a run-of-the-river project, sustainable and self-sustaining. Environmental impacts are positive, with electricity from the power plant replacing kerosene and wood burning in the villages, and contributing to emissions reduction.

Rapid growth of the communities near the Rum-Khola micro-hydro is an example of how access to sustainable energy can change the face of communities. Today, demand for electricity is far outstripping supply in Darbang and neighboring areas.

Throughout Nepal, AEPC has facilitated the construction of over 1,000 micro-hydro plants in 52 districts, repeating the success of Darbang throughout Nepal. With its inclusive community driven model, the micro hydro initiative in Nepal is meeting energy needs of rural communities, and powering their economic development.

Villages like Darbang are also an example of how renewable, clean energy harnessed through community efforts can set the world on a path to a cleaner and more prosperous future.