Nepal’s hydropower sector recorded a sharp improvement in financial performance in the fiscal year 2025/26, with 106 hydropower companies listed on the Nepal Stock Exchange (NEPSE) reporting a combined net profit of Rs 11.11 billion. The figure marks a significant turnaround from the Rs 1.22 billion net profit recorded by the same companies in the previous fiscal year.
According to NEPSE data, the companies’ combined electricity sales revenue increased by 28.54 percent to Rs 56.53 billion, compared to Rs 43.98 billion a year earlier. At the same time, their financial expenses declined by 5.64 percent to Rs 19.65 billion.
Mohan Kumar Dangi, president of the Independent Power Producers’ Association of Nepal (IPPAN), attributed the improved performance to several factors, particularly the decline in bank interest rates, increased electricity generation and higher utilization of hydropower projects during the rainy season. Interest rates on project loans, which had previously reached as high as 13 percent, have fallen to around 6.5 percent, substantially reducing financing costs for hydropower companies.
The shortage of liquefied petroleum (LPG) gas also contributed to higher electricity consumption. Following concerns over LPG supplies amid geopolitical tensions, consumers increasingly turned to electricity for cooking. The Nepal Electricity Authority reported that daily electricity demand recently reached between 2,500 MW and 3,200 MW.
Upper Tamakoshi Hydropower recorded one of the most notable turnarounds. After suffering a loss of Rs 3.68 billion in the previous year, the company posted a profit of Rs 925.9 million in 2025/26. Its electricity sales revenue rose 54.09 percent to Rs 10.66 billion, while financial costs declined by 8.51 percent.
In terms of profit size, Sahas Urja led the sector with Rs 1.35 billion, followed by Solu Hydropower with Rs 1.11 billion. Mountain Energy Nepal earned Rs 797 million, Chilime Hydropower Rs 720 million, Sanima Middle Tamor Rs 624.2 million, Green Ventures Rs 444.7 million and Super Madi Hydropower Rs 426 million.
Several companies that had reported losses in the previous fiscal year also returned to profitability, including Balephi Hydropower, Madhya Bhotekoshi Hydropower, Mountain Hydro Nepal, Vision Lumbini Urja, Panchthar Power, Sanjen Hydropower, Nyadi Hydropower, Dordi Khola Hydropower, Liberty Energy, Maya Khola Hydropower and Buddhabhumi Nepal Hydropower.
However, not all companies performed positively. Rasuwagadhi Hydropower reported the largest loss of Rs 1.44 billion, while Trishuli Jal Vidhyut Company posted a loss of Rs 131.65 million.
The sector’s improved profitability highlights the combined impact of lower borrowing costs, stronger electricity generation and rising domestic power consumption. Sustained growth in electricity demand, particularly through greater adoption of electric cooking and electric vehicles, could further strengthen the financial outlook of Nepal’s hydropower industry.
