Separate Company Formed to Allocate 10 Percent of Bhote Koshi Shares to Locals

A separate company has been established to allocate 10 percent of shares of the 45-megawatt Bhote Koshi Hydropower Project in Sindhupalchok to local residents, following an agreement reached after weeks of disruption at the project site.

Power generation at the project had remained halted for more than a month after a group, identifying itself with the Gen Z movement, demanded 10 percent of the project’s shares free of cost and issued threats. The disruption caused losses of more than Rs 300 million, according to the project developer, Bhote Koshi Power Company.

Operations resumed after an all-party meeting held on October 12 involving local elected representatives, members of the agitating group, Bhote Koshi Power Company and the chief district officer of Sindhupalchok. The meeting agreed to allocate 10 percent of the company’s shares to locals through an initial public offering (IPO).

Following the agreement, Bhote Koshi Gen Z Public Investment Company has been formed to facilitate the issuance of shares to local residents, said Bhote Koshi Rural Municipality Chairperson Pasang Nurpu Sherpa. He said an agreement has been reached to distribute shares to residents of all wards of the rural municipality, and the company is currently collecting population data for this purpose.

Under the agreement, locals will be able to purchase the shares using bank loans, with Bhote Koshi Power Company itself standing as the loan guarantor.

Phurba Sherpa, chief of Bhote Koshi Gen Z Public Investment Company, said the rural municipality has a population of around 18,000 across its five wards, but not all residents will be eligible to apply for shares.

“As per the agreement, only one person per household will be allowed to apply for the IPO, so it is estimated that around 7,000 people will be eligible,” he said, adding that the figure could change once data collection is completed. The process of obtaining bank loans will begin after the data collection is finalised.

The Bhote Koshi Hydropower Project is a 45-megawatt run-of-river project promoted through foreign direct investment. Initially developed with direct US investment, the project began commercial operation in 2001.

Company spokesperson Prem Saud also confirmed that a separate company has been established in line with the all-party agreement and that population data collection is underway. He said the agitating side had initially demanded shares for the entire population of the rural municipality, but later agreed to the one-shareholder-per-household model.

Saud noted that when the project was built, Nepal did not have a legal provision requiring hydropower developers to allocate shares to project-affected local communities, which is why locals did not receive shares at the time. He added that locals had later demanded a 6 percent stake in the company through negotiations.