Puwa 2 Hydropower Project Restarts Power Generation
25th January 2026, Kathmandu
The Puwa 2 Hydropower Project, operated by Peoples Power Limited, has officially resumed electricity generation after remaining shut down for several months due to significant flood damage. The 4.96-megawatt project restarted its power production on Magh 9, 2082, marking an important milestone in the recovery of the small hydropower sector in Nepal following the devastating monsoon disruptions of the previous year.
Puwa 2 Hydropower Project
The project had been completely offline since early October (Ashoj), when continuous and heavy rainfall triggered flooding that severely affected operational components across the Ilam district. The extreme weather caused damage to critical infrastructure, disrupted water flow systems, and created hazardous conditions that made it unsafe to continue generation. As a result, the facility remained closed to allow for thorough inspection, complex repairs, and full safety assurance.
Restoration Efforts and Technical Recovery
According to Peoples Power Limited, extensive restoration work was carried out over the past few months to bring the facility back into a stable operational state. Technical teams focused on several key areas to ensure long-term resilience:
Electro-mechanical Repairs: Technicians worked to restore damaged equipment within the powerhouse that had been affected by silt and water ingress.
Civil Structure Strengthening: Teams reinforced the intake areas and dam structures that had been weakened by the force of the floodwaters.
Transmission Stability: The intake and transmission systems underwent rigorous testing to ensure that the 4.96 MW output could be safely evacuated to the national grid without further tripping issues.
Only after completing these necessary safety checks and performance evaluations was the project granted permission to resume electricity generation. The restart is particularly timely as it coincides with the winter season, where every megawatt of domestic production is vital for the Integrated National Power System.
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Importance to Nepal Energy Security
The resumption of the Puwa 2 Hydropower Project is significant for the energy sector of Nepal, especially during the dry season when river levels drop and domestic production capacity is naturally constrained. Small-scale hydropower projects contribute meaningfully to the grid by reducing the necessity for expensive power imports from neighboring countries.
Flood-related shutdowns have become an increasing concern for hydropower developers in the region. Climate variability and intense rainfall patterns pose serious operational risks to run-of-the-river projects, which often lack large storage reservoirs to buffer against sudden surges in water volume. The temporary closure of Puwa 2 serves as a stark reminder of the vulnerability of infrastructure to natural disasters and underlines the critical importance of disaster-resilient design.
Impact on Corporate Performance
With electricity generation now restored, the project is expected to contribute its full capacity to the national grid, supporting supply stability for households and industrial consumers alike. From a corporate perspective, the restart improves the revenue prospects for Peoples Power Limited. The company recently reported a positive shift in its financial health, including becoming debt-free in early 2082 after successful loan repayments.
Industry experts note that the timely restoration of hydropower projects after natural disruptions is critical for maintaining investor confidence. Delays in resuming production can significantly impact the financial performance, loan servicing, and dividend potential of power companies. The successful restart of Puwa 2 demonstrates effective operational management and recovery planning by the Peoples Power team.
Lessons for Future Hydropower Planning
The government and regulatory bodies have consistently emphasized the need for developers to adopt advanced risk mitigation strategies. This includes better flood forecasting, reinforced infrastructure, and comprehensive insurance coverage to handle “business interruption” losses. Lessons learned from the flood-affected projects in Ilam are expected to guide future hydropower policy and planning.
From a broader perspective, the revival of this project aligns with the long-term goal of Nepal to maximize hydropower utilization and achieve energy self-sufficiency. Each restored project strengthens the national grid and reduces dependency on external energy sources, especially during peak demand periods.
Conclusion
In conclusion, the resumption of electricity production at the Puwa 2 Hydropower Project marks a positive development for both the promoter company and the hydropower industry of the country. After months of disruption caused by catastrophic flooding, the return of the project to full operation reflects technical preparedness and the growing importance of sustainable energy infrastructure. As the project stabilizes, it will once again serve as a reliable source of green energy for the nation.
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