Upper Bhotekoshi Hydro restarts power generation after agreement with locals on 10pc equity transfer

KATHMANDU:The month-long stalemate surrounding the 45-megawatt Upper Bhotekoshi Hydropower Project in Sindhupalchok has ended after the Bhotekoshi Power Company reached a landmark agreement to transfer 10 percent of its shares to the Bhotekoshi Gen-Z Public Investment Public Limited, a company formed by local residents.

The agreement was signed on Sunday between Phurpa Sherpa, Chairperson of Gen-Z Public Investment Public Limited, and Bishwamohan Karmacharya, Secretary of Bhotekoshi Power Company. The new deal ensures that local residents from the project-affected areas will collectively own 10 percent of the company’s equity, expanding the previous commitment of 6 percent set by the 2014 (2071 BS) agreement.

According to company sources, the local investment company was formed with around 20,000 shareholders, who will purchase the 10 percent stake through a structured payment model based on dividends and bonuses over time. The deal also binds the hydropower company to provide NPR 25 million (2.5 crore) annually to Bhotekoshi Rural Municipality under its corporate social responsibility (CSR) obligations, a significant increase from the earlier arrangement.

The Upper Bhotekoshi Hydropower Project, located in Sindhupalchok district, had been completely shut down for a month following a protest by the so-called “Bhotekoshi Gen-Z Group.” The group, under the banner of the Gen-Z movement, had demanded a 10 percent free share allocation for local residents, halting operations and warning of continued disruption if their demands were not met.

While the company initially refused to offer free shares, it later agreed to a paid share transfer, ensuring both community participation and financial sustainability. “The project will resume normal operations immediately, and the safety of employees and the plant will be ensured with the support of local representatives,” the agreement states.

The accord further outlines that any future disputes or demands from local groups will be resolved with the cooperation of the Gen-Z Public Investment company, which has pledged full support to prevent future blockades or shutdowns.

The Bhotekoshi Power Company emphasized that this agreement represents a long-term partnership with local communities, reinforcing the model of public-private collaboration in Nepal’s hydropower sector.

Earlier, under political supervision, the company had promised to distribute 6 percent shares to locals, but tensions escalated during the Gen-Z movement’s protests on September 8–9 (Bhadra 23–24), leading to a complete halt in power generation. The fresh 10 percent share agreement, therefore, combines the earlier commitment with an additional 4 percent, as documented in the official memorandum of understanding.

The Upper Bhotekoshi Hydropower Project, developed under a foreign direct investment (FDI) model, is a crucial part of Nepal’s energy generation framework, contributing significantly to the national grid. Analysts say the resolution of the dispute sends a positive message to investors, particularly in the hydropower and energy investment sector, which had expressed concern over repeated local obstructions in FDI-backed projects.

The new deal, observers note, not only restores operational stability but also demonstrates how community equity participation can balance local benefit with project security — a key lesson for future hydropower and infrastructure investments in Nepal.