A thesis submitted in partial fulfillment of the requirement for the degree of Master of Engineering in Construction Engineering and Infrastructure Management

Thesis (M.Eng.) - Asian Institute of Technology, 2010

The hydropower organizations in Nepal are constantly striving to ascertain the value addition to its stakeholders. Traditional delivery system alone has not been able to fulfill and sustain hydropower development. To overcome this limitation, public private partnership (PPP) has been introduced as an innovative public policy tool for the need of dynamism in traditional delivery approach. Despite the abundant hydropower potential in the country, the electricity generation is inadequate, unreliable and expensive. A part of these consequences can be attributed to hydropower asset management. In this connection, this study attempts to investigate the existing asset management practices in public and PPP hydropower stations of Nepal. Based on the verified investigation criteria, each of two public and PPP hydropower stations are investigated through direct interview with station managers and site observations. The results are analyzed using explanation building as the specific analytic approach in the case study. The distinct features of asset management in public and PPP practices are identified, analyzed and highlighted.The research findings reflect that both public and PPP practices are weak in managing hydropower assets in Nepal. The cross case synthesis implies that within public and PPP power stations, there are significant differences in asset management practices. However reduced cost of financing, though initial investment is higher by 35% than in PPP, maintaining minimum balance of spare parts and lower operation and maintenance cost are identified in the public practices. While, PPP practices have revealed better structured asset management in terms of project implementation, stakeholder relationship, organizational development, maintaining asset database, monitoring asset condition and carrying preventive maintenance for high reliability which has resulted maximum plant utilization and higher productivity.