Another project on offer, Kaligandaki II (660 megawatts), is a follow-up to the largest existing hydropower project in Nepal, the Kaligandaki Dam (144 megawatts), situated in the deepest river gorge on earth, an area home to abundant vegetation and wildlife. Constructed in 2000 amid controversy over the effects it would have both on the indigenous people in the area and on the environment, the dam has since resulted in flooding leading to soil erosion as well as persistent droughts, putting an end to the local fisheries industry. Kavati Rai, a postgraduate student who studied the effects of dam building on communities, noted that “Kaligandaki is one of the first [projects in Nepal] where indigenous groups have been impacted, so they are learning slowly” [25]. The follow-up project, should it be carried out, will likely wreak an even heavier toll.

Karnali-Chisapani

Yet the Arun III and Kaligandaki projects pale in comparison to the true “jewel” [26], the rivers and gorges of the Karnali basin in western Nepal, an area with numerous sites capable of producing immense quantities of cheap hydroelectric power. Central among proposals for this region is the Karnali-Chisapani mega-dam project, a long-time dream of political and corporate players both within and outside of Nepal. According to the latest design, the rock-fill dam would climb to a towering 270 meters, permanently inundating 339 square kilometers of land in the mid-west valley of Nepal, displacing 60,000 inhabitants, to create a massive reservoir. With a storage volume of 20 billion cubic meters, the dam’s reservoir and its projected output of 10,800 megawatts — amounting to more than two-thirds of the total generating capacity currently on offer — rival the enormity of the 18,200 megawatt Three Gorges Project (TGP) in China. Yet in contrast to the Chinese dam, the Nepalese proposal has received little attention outside of Nepal, other than among corporate circles with interests in the project.

Plans for realizing the Karnali-Chisapani project first took shape ten years ago, in 1996, with a proposal from a “prestigious” upstart American multinational. As Ajaya Dixit describes it, “Enron, with no track record of building a single hydropower project anywhere in the world, opted for the mighty 10,800 Mw Karnali hydropower project.” Nepalese officials, enamored by “the philosophy of building high dams,” were only too happy to accommodate; yet the American corporation, “in typical Enron fashion, did not make its approach through the official channel,” opting instead to “forward its application through the prime minister’s office” [27]. Deepak Gyawali, a hydropower expert, remarked at the time that the survey license awarded to Enron, ostensibly arrived at via “political consensus,” in fact “involved only four politicians in a room” [28].

Enron’s plans for Karnali-Chisapani ultimately failed to materialize, due not to political resistance — all parties were happy to oblige — but to political disorganization. A notable exception was then Water Resources Minister Sailaja Acharya, who had written to Enron requesting that the project be deferred pending further investigation. Santa Bahadur Pun, former managing director of the NEA, in an article coauthored by Prachar Mansingh Pradhan, describes the political fallout of this move:

Our Parliamentarians were so much “educated” with the virtues of private sector and foreign investment that even her own Congress Party wailed and bemoaned that she had killed the goose that would have surely laid the golden eggs.… One can only conjecture what damages Nepal would have incurred if our Parliamentarians’ supposed golden goose, Enron, had drowned clutching the Karnali Chisapani license [29].

Reports indicate that an American company (Texas Power) and a group of non-resident Nepalese backed by Russian banks and consultants are currently vying to get a hold of this very same license [30]. The “golden goose,” it would seem, did not drown so easily; it remains to be seen what damage Nepal will incur this time around.

West Seti

Karnali-Chisapani is not the only project in the Karnali basin, however. Unmentioned in reports of the recent meeting in Kathmandu is the 750-megawatt West Seti project, to be built by Australia’s Snowy Mountain Engineering Corporation (SMEC) with financing from China’s Export-Import Bank and the Asian Development Bank (ADB) [31, 32]. With a height of 195 meters, the concrete faced rock-fill dam (CFRD) at West Seti would be the highest of its kind in the world, comparable dams in China and Mexico rising to 180 meters and 185.5 meters, respectively. Thapa writes that “the embankment type of dam with impervious earthen core is the best suited for the proposed site.” Yet the CFRD-type was chosen as a low-cost alternative, with potentially grave consequences:

Our government has not cared to consult a panel of internationally known competent experts to verify the reliability of the design of the proposed dam. It is very clear that tens of thousands of people would be killed if the West Seti dam collapsed due to faulty design. Vast areas of land in Nepal and India would be laid waste with sand deposits [33].

 Save as PDF