The construction of the 140 MW Tanahun Hydropower Project, Nepal's first reservoir-based hydropower facility, is advancing steadily with an overall progress rate of 63%, according to the latest project update. Divided into three major packages, the project is expected to be completed by May 2026, aiming to significantly boost Nepal’s energy production capacity.
Breakthrough in Tunnel Construction
Under Package-2, a 1,493-meter-long tunnel connecting the reservoir intake to the underground powerhouse has been successfully excavated. A 213-meter-long penstock pipe will direct water from the tunnel to the underground powerhouse, where electricity generation will occur. The penstock pipe installation is in its final stage, while concrete lining work is ongoing.
This package, which also includes the construction of the powerhouse and the supply, installation, and operation of hydromechanical and electromechanical equipment, is being executed by Sinohydro Corporation of China. The overall progress of Package-2 stands at 62%, with the civil construction of the powerhouse nearing completion.
Advancements in Transmission Infrastructure
Under Package-3, a 220 kV double-circuit transmission line connecting Damauli to Bharatpur is being constructed by KEC International Limited, India. Of the 94 planned towers along the 34.7 km transmission line, foundations for 78 towers have been completed, and 69 towers have been erected. This package has achieved a 74% progress rate.
Preparations for Main Dam Construction
The 140-meter-high main dam, located along the Seti River at the border of Rishing Rural Municipality-1 and Byas Municipality-5, is being developed under Package-1. Currently, grouting work is underway in the lower layer of the dam, with crusher and cooling plants set up and ready for operation. The construction of the main dam is expected to begin soon, and the progress of Package-1 is estimated at 36%. This segment is being executed by Song Da Corporation of Vietnam in partnership with Kalika Construction Pvt. Ltd., Nepal.
Financing and Investment
The total cost of the Tanahun Hydropower Project, including transmission lines, rural electrification, and interest during construction, is estimated at USD 505 million. Financial support has been secured through multiple stakeholders: the Asian Development Bank (ADB) is contributing USD 150 million, the Japan International Cooperation Agency (JICA) USD 184 million, the European Investment Bank USD 85 million, and the Government of Nepal and Nepal Electricity Authority USD 86 million.
Future Outlook
The Tanahun Hydropower Project is poised to transform Nepal’s energy landscape by providing reliable electricity supply and reducing the country’s dependency on seasonal river flows. Managing Director Kiran Kumar Shrestha expressed optimism about meeting the completion target by May 2026. “The main dam construction will begin soon, and the project is progressing as planned,” he stated.
As Nepal moves towards energy self-sufficiency, the Tanahun Hydropower Project stands as a beacon of sustainable development, underscoring the country's commitment to harnessing its natural resources for long-term economic growth.
