IREDA Announces Strategic Equity Investment in Upper Karnali Hydro-Electric Power Project

In a significant development, the Indian Renewable Energy Development Agency (IREDA) has formalised its participation in the Upper Karnali Hydro-Electric Power Project in Nepal. This move is part of its broader commitment to fostering renewable energy initiatives.

As of 9:22 AM on January 17, 2025, shares of the Indian Renewable Energy Development Agency (IREDA) are trading higher by 1% on the National Stock Exchange (NSE). The upward movement in the stock price reflects positive investor sentiment, potentially driven by the company’s recent announcement of its strategic equity investment in Nepal’s 900 MW Upper Karnali Hydro-Electric Power Project.

Key Highlights of the Joint Venture

IREDA has entered into a Joint Venture Agreement with multiple entities, including GMR Energy Limited and the Nepal Electricity Authority, to develop the 900 MW Upper Karnali Hydro-Electric Power Project. Here are the essential details:

• Equity Investment: IREDA will hold a 5% equity stake, estimated at approximately ₹174.22 crore.
• Stakeholders Involved:
  • GMR Energy Limited
  • GMR Power and Urban Infra Limited
  • GMR Lion Energy Limited
  • SJVN Limited
  • Nepal Electricity Authority
  • GMR Upper Karnali Hydropower Limited (JV Company)

Objectives of the Project

The Upper Karnali Hydro-Electric Power Project is envisioned as a transformative renewable energy initiative aimed at:

1. Enhancing regional energy security through sustainable power generation.
2. Strengthening international collaboration in renewable energy projects.

Significant Terms of the Agreement

The agreement outlines several key provisions to ensure effective governance and smooth execution:

• Board Representation: IREDA is entitled to nominate one director to the board.
• Leadership Appointments: The chairman and CEO will be chosen from nominees of SJVN and GMR.
• Equity Structure: Nepal Electricity Authority will receive shares free of cost, ensuring their equity partnership without financial obligations.

Regulatory Approvals and Oversight

The project received approval from the Department of Investment and Public Asset Management (DIPAM), with recommendations from India’s Ministry of New and Renewable Energy. This ensures alignment with regulatory frameworks.

Importance of the Project

The Upper Karnali Hydro-Electric Power Project is expected to:

• Contribute significantly to Nepal’s energy infrastructure.
• Foster cross-border collaboration in renewable energy.
• Boost regional economic development by generating clean energy.

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