By Nilhari Neupane, Shisher Shrestha, and Prasis Poudel
The Terai region, often referred to as the “food basket” of Nepal, is endowed with significant groundwater resources. These are, as yet, largely untapped, and offer immense potential for sustainable agricultural growth. Groundwater currently supports food production for half a million hectares of land in Nepal – less than half of the country’s irrigated area – and almost entirely through shallow tubewells (STWs). These have been defined as wells up to 50 m deep and less than 10 cm in diameter. Wells exceeding this depth and diameter are deep tubewells (DTWs).
The Groundwater Resources Development Board of the Ministry of Energy, Water Resources and Irrigation of Nepal states that around 190,000 ha of agricultural land in the Terai has good potential for DTWs, which is three times the level of current development. DTWs have several advantages over STWs: their yield is more reliable, they can support larger command areas (≥40 ha), and they are overall more economical and efficient. However, uptake of DTWs has been slow, with only around 1,500 installed as of 2018, the latest year with available data. In contrast, there are more than 160,000 STWs in the Terai. Although DTWs were initially designed to be used with diesel pumps, these have gradually been replaced by electric pumps due to improved electricity access, the withdrawal of subsidies on diesel, lower fuel efficiencies, and improved pumping technologies. The remaining number of diesel-operated DTWs is unknown but likely very low. Moreover, the Government of Nepal has mandated the installation of transformers to ensure an electricity supply for new DTW projects.
Research rationale and approach
The CGIAR Initiative on NEXUS Gains is exploring strategies to improve DTW performance, with a focus on the potential of solarizing DTWs in the Terai to enhance reliable year-round irrigation and provide irrigation to a greater number of small- and medium-sized farms (Figure 1). NEXUS Gains began by conducting a mixed-method analysis, commencing with a historical review of DTWs. A policy analysis identified regulatory and financial gaps within the framework governing DTWs; this was complemented in 2022 by focus group discussions and technical surveys for six DTW locations in the Terai districts of Siraha and Saptari. NEXUS Gains also conducted key informant interviews with women users, members of water users’ groups (WUGs), and experts working with DTWs, to examine their benefits and energy requirements, and the feasibility of solarization.
STWs are predominantly privately funded and owned, serve much smaller command areas (<1.5 ha), involve higher transaction costs (including pump repair and maintenance and spare parts), and – in the case of diesel-operated STWs – generate more greenhouse gas emissions than electric DTWs. STWs may also pose equity concerns as they mainly serve medium- and large-scale individual farmers, whereas marginal and tenant farmers are mostly water buyers. In addition, observations at selected monitoring wells have shown that shallow groundwater levels are dropping at an alarming rate. During the summer of 2015, farmers in Saptari noted that STWs were drying up, resulting in the need to deepen the tubewells.
DTWs can be a sustainable alternative in areas facing declining shallow groundwater levels. However, their financial viability and affordability is challenging, especially for small-scale and marginal farmers. DTWs require higher upfront capital investment due to the need for deeper drilling, and more robust infrastructure due to the larger areas they serve. They also have higher total operation and maintenance costs. In Nepal, most DTWs are funded by the government or aid agencies, are publicly or community owned, and involve entire farm communities, with farmers contributing financially and voluntarily to their maintenance and operation. Despite these challenges, DTWs have scope for enhancing equity if the right business model is developed and implemented. A good business model should involve a combination of government subsidies, low-interest loans, private sector participation, and community contributions.
Preliminary findings
Despite substantial government and aid agency contributions, the growth of DTWs has significantly slowed, with a total of 400 DTWs in the country in 1995, 1,050 in 2000, and an estimated 1,500 in 2018. A study conducted by the Asian Development Bank in 2016 found that around 30 percent of DTWs in the Terai were not functioning, which suggests wasted investments. Our research shows this is largely due to unreliable electricity supply, poor project execution, insufficient capacity building of user communities, and the associated failure to generate sufficient repair and maintenance funds.
Equity and reliability
Each grid-connected DTW with a command area of 40–50 ha has a total installation cost of around NPR 10 million (approx. USD 75,000). As the solarization of a single DTW is estimated to cost NPR 3 million (approx. USD 22,500), solarizing all defunct pumps (an estimated 450 out of 1,500 DTWs) would require around NPR 1.3 billion (approx. USD 9.7 million) – equivalent to installing around 130 new DTWs. This cost could be justified by the enhanced irrigation reliability, extended cropping intensity, and reduced probability of failure due to the provision of two energy sources. The costs could be more easily recovered if farmers switched to higher-value crops – such as vegetables, spices, hybrid maize, and spring rice – which would be facilitated by the more stable water supply during the summer season when electricity is less reliable. This would assume, however, that farmers are willing to repay the cost of the solar system.
Reducing costs for marginalized farmers
The major operational costs of DTWs are the electricity tariff and repair and maintenance costs, which marginal farmers are often unable to afford, leading to sub-optimal operation or defunct systems. Solarizing DTWs largely offsets this. Furthermore, if a net metering policy is enacted in the future, income generated by selling surplus energy during periods of low irrigation demand could contribute to the running costs.
Poor financial sustainability
Once the government has installed the DTW, management responsibilities are generally transferred to a WUG, which often includes different categories of farmers within the command area. Some groups are less able to successfully execute projects, and collecting funds to cover operational costs is often a challenge. In the case study sites, WUGs initially established a nominal water tariff (NPR 100 [approx. USD 0.75] per month per user) which was insufficient to cover the costs of major works and meant that pumps could not be used. According to the WUGs, the irrigation fee cannot go beyond this figure due to the current state of agricultural development and poor market integration in these districts. As a result, the WUGs struggle to ensure the effective operation of the DTWs, leading to operational inefficiencies and potentially wasted public investments.
Findings and suggestions
Our analysis suggests that the solarization of DTWs might bring substantial benefits but is also associated with some level of risk. Developing successful business models for DTWs is crucial, and this requires balancing the objectives of various farmer groups, including subsistence farmers, farmers producing vegetables for the haat-bazar (local market), and medium-sized and large farms (>1 ha) that generate enough funds to manage DTWs on their own. Piloting different business models would ensure that resource-poorer farmers can also access DTWs. These models could include:
- A local government-led business model targeting marginal farmers and smallholders, focused on food security and equity with continued strong public support for, and oversight of, operations and maintenance.
- A water entrepreneurship model whereby the private sector manages DTWs and sells water to farmers who produce high-value vegetables and other crops for the market (see Infrastructure Development Corporation Limited’s business model in Bangladesh).
- A community-led model for medium- to large-scale farmers who have the capacity to generate funds for repair and maintenance.
- A farmer-led model for large-scale farmers who can afford a DTW on their own.
Piloting the first three models could help increase the number, sustainability, and equity of DTWs. We also encourage the provision of net metering policies that allow the WUG to inject surplus solar energy to the grid, generating additional income to cover maintenance costs.
Nilhari Neupane and Shisher Shrestha are National Researchers at the International Water Management Institute, Nepal. Prasis Poudel is Solar Photovoltaic Monitoring and Evaluation Expert at the Alternative Energy Promotion Center, Nepal.
This work was carried out under the CGIAR Initiative on NEXUS Gains, which is grateful for the support of CGIAR Trust Fund contributors: www.cgiar.org/funders
Header image: Deep tubewell in Nepal. Photo by Shisher Shrestha.
