• State-owned IREDA has finalised a joint venture agreement with SJVN, GMR Energy and the Nepal Electricity Authority to set up a 900 megawatt hydropower project in Nepal.

• The agreement for the 900 MW Upper Karnali hydroelectric project was formalised in New Delhi on January 16. This strategic initiative aims to strengthen regional energy security and accelerate renewable energy growth.

• The joint venture agreement lays out a comprehensive framework for project development, construction, operation, and maintenance under a Build-Own-Operate-Transfer (BOOT) model, with a 25-year project term from the Commercial Operation Date (CoD).

What is the purpose of IREDA?

• Indian Renewable Energy Development Agency Limited (IREDA) is a ‘Navratna’ government of India Enterprise under the administrative control of the Ministry of New and Renewable Energy (MNRE). 

• IREDA is a public limited government company established as a non-banking financial institution in 1987 engaged in promoting, developing and extending financial assistance for setting up projects relating to new and renewable sources of energy, energy efficiency and conservation.

• Since its inception, the company has played a catalytic role in developing market for financing renewable energy and energy efficiency (EE) projects. 

• IREDA, with years of techno-commercial expertise, plays a catalytic role in the RE project financing which gives confidence to the financial institutions/banks to lend in the sector.

Objectives of IREDA:

i) To give financial support to specific projects and schemes for generating electricity and  energy through new and renewable sources and conserving energy through energy efficiency.

ii) To maintain its position as a leading organisation to provide efficient and effective financing in renewable energy and energy efficiency/conservation projects.

iii) To increase IREDA’s share in the renewable energy sector by way of innovative financing.

India-Nepal Cooperation in Power Sector

• One of the win-win areas of cooperation in the India-Nepal bilateral relations is the collaboration in the power sector. 

• The Joint Vision Statement on power sector cooperation issued on April 2, 2022 during visit of Prime Minister of Nepal to India, laid out a comprehensive roadmap for bilateral cooperation in the sector. 

• Its key pillars include joint development of power generation projects in Nepal, development of cross-border transmission infrastructure, bidirectional power trade, coordinated operation of the national grids and institutional cooperation in sharing latest operational information technology and know-how.

• India and Nepal signed an agreement in 2024 for purchase of 10,000 MW of hydropower by India from Nepal in the next 10 years.

• Arun-3 hydroelectric project (900 MW), is presently under construction in Nepal being implemented by a wholly owned subsidiary of SJVN Ltd. 

• In addition, projects of about 11.2 GW are at various stages of planning in Nepal with Indian cooperation. They are: Pancheshwar multipurpose project (5,040 MW), Lower Arun hydroelectric project (669 MW), Sapta Kosi multipurpose project (3,300 MW), Arun-4 hydroelectric project (490 MW), West Seti hydroelectric project (750 MW), Seti River-6 hydroelectric project (450 MW), Phukot Karnali Project (480 MW).

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