Bhote Koshi Hydropower Reaches Initial Deal to Offer 10% Free Shares to Locals

The developer of the 45-megawatt Bhote Koshi Hydropower Project has reached a preliminary agreement to provide 10 percent of its shares free of cost to local residents, a company official confirmed. The agreement will become official only after approval from the company’s board of directors.

Company spokesperson Prem Saud said both parties have signed a draft understanding, which has been sent to the board for a final decision. “The board’s resolution will determine whether the free-share proposal proceeds,” Saud explained.

The accord follows weeks of unrest. On September 10, a group identifying itself with the “Gen Z movement” stormed the project office demanding 10 percent free shares, forcing staff to flee and halting electricity generation. Production remains completely suspended, and a Nepal Army team is now securing the site.

Located in Sindhupalchok, Bhote Koshi is one of Nepal’s first large hydropower projects built with direct foreign investment. The plant began commercial operation in 2001, before any legal requirement existed to distribute shares to affected communities. Local residents have long pressed for a stake, initially requesting 6 percent. In 2014, a multi-party committee was formed to study their demand, but no report was ever submitted.

Tensions escalated after a second protest led to clashes between demonstrators and security forces, injuring several locals and officers. Following the clash, local representatives, protest leaders, and company officials signed the draft agreement committing to provide 10 percent free shares to all residents in the project area. The document stipulates the board must decide within 45 days.

Pasang Nurpu Sherpa, chair of the Bhote Koshi Rural Municipality, warned that protests will resume if the board rejects the plan. Protest leader Phurba Sherpa said electricity generation will remain halted until the board reaches a decision.

The protests have caused damage to the rural municipality office but not to the hydropower facility itself. Bhote Koshi Power Company was originally majority-owned by U.S.-based Panda Energy, which sold its stake in 2006. About 95 percent of the company’s shares are now held by Nepali investors, with the remaining 5 percent owned by an American firm.

Read: Bhote Koshi Hydropower Plant Shut for a Week