Description: 

A renewable energy program that seeks to harness renewable energy generation by promoting and providing financial and technical support for large off-grid biogas energy plants in Nepal.

Background:

With only 56% of its population accessing electricity, and energy demands increasing 7.6% per annum, the Government of Nepal has adopted unique plans to address its energy crisis – through biogas plants. In Nepal, more than 250,000 biogas plants are installed in rural areas for cooking fuel supply, though large-scale waste to energy is a relatively new concept. In 2013, with SREP support, the Alternative Energy Promotion Centre (AEPC) held the “Waste to Energy Bazaar” to raise awareness about biogas renewable energy potential.

In 2014, a $7.9 million SREP allocation to the Extended Biogas Program was approved, and is expected to leverage $126.4 million in co-financing. The program will address high initial cost and credit financing barriers to use of organic waste for renewable energy production. The investments aim to improve energy access and stimulate economic activity, thereby alleviating poverty and improving quality of life in local communities. The program, anticipated to be complete by December 2019, will cost an estimated $35 million.

Objectives and Outputs:

In line with Nepal’s goal to increase renewable energy shares to 10% from the current 1% of energy supply by 2030, the program will address market barriers. The program will provide financing and technical assistance services for the planning and implementation of 160,000 biogas plants. Local companies will receive support engaging in commercial biogas technologies, under the Extended Biogas Program. AEPC, in coordination with IBRD, will be the implementing agency.

The program will seek to benefit large off-grid biogas plants, especially in rural areas. Among the direct beneficiaries are Nepal’s women and youth, who will enjoy greater economic opportunities for technical training in construction, operation, and maintenance. The program is expected to avoid 800,000 tons CO2 emissions per annum, along with reduced pressure on Nepal’s forests for cooking fuel. The program was declared effective on November 24, 2014, and officially launched under the leadership of the AEPC on February 3, 2015. As of April 2015 is still in its startup phase.

This project summary is drawn from draft project proposals [such as the PAD, PID, SAR, and country investment plan] and may not contain the most up-to-date information.

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Project Details
Cover Note | Project Document  | Proposed Decision | MDB Project ImplementationServices (MPIS)
Approved on February 3, 2014 (Approved Decision)
Approved Amount(s):
USD 7.9 Million (grant funding)
USD 650,000 (MPIS Second tranche)