MPs question PHPA’s cost escalation

Hydropower: Members of Parliament who were on a visit to the sites of Punatsangchhu hydropower projects in Wangdue yesterday questioned the projects’ managing director, R N Khazanchi on the cost escalations.

Gangzhu-Minjey’s MP, Karma Rangdol who posed the question was among the group of parliamentarians and ministers who visited the project sites. Speaker Jigme Zangpo led the group.

R N Khazanchi said the cost escalation is not happening for the first time and that it has happened with Tala and several other hydropower projects.

R N Khazanchi explained that in case of Tala project, the initial cost was Nu 14 billion and completion cost was Nu 41.25 billion –three times more than the initial cost.

For Punatsangchu-I, he said the initial cost was Nu 35.14 billion and now it is Nu 93.75 billion. “By the time we complete the project, the cost might have increased by a few more billions,” he said.

For PHPA-II, the initial cost was Nu 37.78 billion, and now the estimated cost is Nu 76 billion, which means it is twice the initial cost.

“Whatever we are doing today is not happening for the first time,” he said. “It has been happening always in every hydropower projects we have taken up.”

Meanwhile, presenting the projects’ status to the members of parliament, RN Khazanchi said that with regard to 1,200 MW PHPA-I, they have completed about 75.5percent of the works.

He said they have completed with diversion tunnels, cofferdam of 27m height and 142m in length, power intake tunnels and surge shaft dome.

The stabilisation measures at PHPA-I dam’s right bank has been completed, and they have started with foundation treatment, while 95 percent excavation works at left bank of the dam is completed.  92 percent works at desilting chambers and almost 96 percent works at headrace tunnel are completed.

Works at powerhouse, including erection bay, has been completed with 76 percent, and two of six generator stators has been assembled.  More than 84 percent of the project colony construction has been completed.

R N Khazanchi said that 66.5 percent of the 1020MW PHPA-II has been completed as of now. The project has completed with the diversion tunnel, cofferdam and 1.5km highway tunnel.

He said the excavation works at right bank of dam has been completed and almost 82 percent from that of left bank. 98 percent works at power intake tunnels have been completed, 61 percent of desilting chambers has been completed, and 98 percent works at connecting tunnels has also been completed.

Once completed, PHPA-I is expected to generate 5,700 million units of electricity, and PHPA-II is expected to generate 4,300 million units of electricity annually.

Dawa Gyelmo, Wangdue 

1 reply
  1. Master
    Master says:

    Who is going to bear the cost? How is it that 2 projects at the same site have different figures of escalation? Does it mean there are elements of corruption? How can we limit our expenses?
    If we really think with an open mind, any additional funds required by these mega projects, required 3 times more than what was estimated, this also means we are putting our future generations or our children into debts so deep that they will have to go through tougher times, work longer, pay higher taxes, live in a volatile economy and end up being ” un happier.”
    Of course these people say that the reports were prepared long time ago, since then a lot of costs have increased. But our people have to be more alert and involved in these type of projects and try to reduce or minimise costs.
    Corruption also plays a major role in the increase of these costs. Only a few benefit but the mass suffer for a long time.
    Sometimes we should introspect our goals and think hard if we need to do all this for the sake of money. Money = Greed = Corruption.
    Hope we realise we are creating our own prison.
    God Bless!

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