Who Holds Nepal’s Energy Switch Now?

For generations, energy scarcity shaped daily life in Nepal. People cooked with collected firewood, studied by candlelight during load-shedding that lasted up to 18 hours a day, and waited outside petrol pumps and LPG depots. The question that followed every political or economic shock was simple: would there be electricity, cooking gas or fuel?

That desperation appeared again in a viral video showing people swimming into raging floodwaters to retrieve LPG cylinders carried downstream. The sight may look incomprehensible from outside Nepal, but it reflects a survival instinct formed by years of institutional failure.

The end of load-shedding changed that relationship with public institutions. Under Kulman Ghising, the Nepal Electricity Authority reformed hydropower generation, transmission and demand management while improving governance. For ordinary Nepalis, the result became a benchmark for what the state could deliver.

Nepal has an estimated 83,000 megawatts of hydropower potential, with about 40,000 MW considered commercially viable. By 2025, roughly 3,435 MW had been installed and another 4,063 MW was under construction. Hydropower brought electricity to homes that had never been connected to the grid, sent surplus power to India and Bangladesh, and created work in local districts instead of pushing as many people toward jobs in the Gulf.

But the drive for speed also shaped the sector’s weaknesses. Developers pushed through Free, Prior and Informed Consent processes with Indigenous Peoples, including projects financed by multilateral banks that violated their own safeguard mechanisms. The recently destroyed Upper Trishuli 1 project was among them.

On Aug. 26, a flash flood swept away 12 hydropower stations along the Bhotekoshi and Trishuli rivers and severely affected 15 more. More than 1,200 people died and thousands remained missing, including many hydropower employees and contractors. Preliminary estimates placed recovery and reconstruction at about $1.3 billion, raising a stark question over who now controls Nepal’s energy future.