Selection of Projects

Detailed Feasibility Study Report

Project approval will be granted by AEPC on the basis of a Detailed Feasibility Study (DFS) Report. The main objective of the DFS Report is to demonstrate the technical, financial and commercial viability of the project in detail, by examining the findings of the Feasibility Study (FS) performing a more detailed assessment.

Prior to applying for DFS co-funding, the Developer shall confirm to AEPC whether international consultants will be involved in the preparation of the report.The DFS is structured in eight sections. Please refer to the “Commercial and MSW Biogas Plant DFS Guidelines” (available from the downloads page) for full details. 

Who completes it?

The DFS shall be prepared by the local Pre-Qualified Consultant (PQC) with or without the support of an Expert Consultant (especially required for cases where technology is new to Nepal) working in conjunction with a local PQC.

A PQC shall always be involved in the preparation of the DFS in order to build the capacity of the local sector. Whether the same entity or different, the DFS technical sections shall be completed by a competent technical PQC. The financial and commercial sections shall be completed by a competent commercial expert associated with the PQC (who may or may not belong to the same company as the technical PQC). The complete DFS report will be submitted to AEPC by the PQC. SREP has identified a gap in capacity regarding the commercial and financial capabilities of the local PQCs, and has proposed to train new consultants with a background in business administration, economics, or related subject to enhance the capacity of the sector; so that these business consultants can support the PQCs to complete the DFS reports.

The newly trained consultants could be part of the PQCs or new PQCs could be formed. In any case, both the technical and commercial consultants shall work together to complete the report.

Cost

There are two options for covering the DFS cost;

  • The DFS cost may be borne by the Developer and AEPC on a 50/50 basis. The Developers will have to request a tender process for which at least a minimum of three PQC firms bid for the DFS; and then the AEPC will make the 50 percent payment share to the PQC firm once the complete DFS is submitted. The cost needs to be approved by the AEPC. AEPC shall check the credentials of the consultant in the case there is an external Expert Consultant who is supporting the PQC. AEPC will cover 50% of the cost if the Developer has chosen this modality up to a cap set by AEPC which shall include the worst case scenario from the Environmental and Social Screening plus an allowance for Expert Consultants.
  • The DFS cost may be borne by the developer in its totality. In this case, AEPC does not need to review the credentials of the consultant if an Expert Consultant is hired and there is no requirement for a tender process including 3 consulting firms bidding for it. However, a PQC shall always be selected to work either alone or along an Expert Consultant to ensure that the capacity of the sector is built. The cost of any of the Initial Environmental Examination (IEE), Environmental Impact Assessment (EIA), Environmental Management Plan (EMP), Social Impact Assessment (SIA), Resettlement Action Plan (RAP) and/or Vulnerable Community Development Plan (VCDP) as applicable is part of the overall DFS cost. The Developer is responsible for ensuring that these documents are included in the DFS and submitted at this stage.