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Nepal micro-hydro program wins carbon emissions deal

Nepal's Alternative Energy Promotion Center (APEC) has signed an emissions reduction sale agreement to support development of 15 MW of micro-hydropower projects in rural areas of Nepal.

APEC signed the agreement June 30 with officials of the World Bank and the United Nations' Clean Development Mechanism (CDM) program for reduction of carbon dioxide emissions believed to contribute to global warming. APEC, the project developer, is to sell 191,000 tons of carbon dioxide emission reductions until 2012 to the Community Development Carbon Fund, which is managed by the World Bank.

Although Nepal has vast hydropower resources, only 600 MW of its 43,000 MW of economically viable potential has been developed. While 90 percent of its urban population is connected to a power grid, only 27 percent of rural households have access to electricity.

The emissions reduction project operates in the poorest and most geographically isolated areas, serving the most socially marginalized groups in rural Nepal. The project complements the World Bank's ongoing Power Development Project to provide increased electricity access to the rural population. (HNN 10/25/06)

The developer expects to install 15 MW of micro-hydro projects, ranging from 5 to 500 kW, by 2011. Plants are to be installed in communities by pre-qualified private companies that receive subsidy and credit support as well as technical assistance. Most plants are to be managed by the communities.

The project provides 35 to 55 percent of the total investment for a plant as well as technical training, market information, and business development support to the local users.

The program is supported by the World Bank, United Nations Development Program, and the governments of Denmark and Norway.

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