Workers shoveled thick mud from a flood-ravaged power station in central Nepal last week, trying to revive a plant that supplies electricity to more than 20,000 people. The facility may not be rebuilt on the same site beside the river that destroyed it.
Up to 900 workers are unaccounted for across a dozen hydropower projects, according to the Independent Power Producers' Association, Nepal, with hundreds believed trapped in tunnels built to access the infrastructure and divert water. In Nepal and China combined, more than 900 people have died and 4,700 remain missing.
The destruction has knocked roughly 700 megawatts offline — about 10% of Nepal's total power capacity. Hydropower projects operating or under construction were fully or partly destroyed in Rasuwa, Nuwakot and Dhading, among the hardest-hit districts. Tens of kilometers of roads, multiple bridges, and essential buildings including schools and hospitals were also destroyed.
The Coalition for Disaster Resilient Infrastructure estimates that $124 billion worth of Nepal's infrastructure is exposed to climate-driven disasters, a figure that points to the scale of capital at risk nationwide rather than losses from this single flood. A separate coalition report found Nepal's average annual losses run near $760 million across various disasters — while the country's national disaster fund covers only a fraction of that exposure.
'Authorities have to take a hard look in the mirror now and ask how they will be rebuilding in these places,' said Jakob Steiner, a geoscientist at the University of Graz. 'They will also have to take a close look at other projects in Nepal that have not been built yet, whether they'll be approved after this event.'
Ramraj Narasimhan of the Coalition for Disaster Resilient Infrastructure argued rebuilding should prioritize continuity of service over indestructibility. 'If it gets damaged, let it get damaged, but can we build in redundancy in the system?' he said, citing better siting, backup power, early warning systems and financial tools such as insurance as ways to speed recovery.
Hydropower is both the backbone of Nepal's grid and a major export earner, and much of its potential lies in run-of-river projects tied to steep, hazard-prone river corridors with limited land. Glaciers across the Hindu Kush Himalaya are losing ice at an accelerating rate, and researchers at the Kathmandu-based International Center for Integrated Mountain Development say permafrost degradation and erratic rainfall are raising flood and landslide risk in the region.
The numbers come first, and they tell a hard story about where capital sits exposed. A national disaster fund that covers only a sliver of $760 million in yearly losses is not a rounding error — it is a policy failure that leaves families, workers and investors holding the risk that government planning failed to price in.
Markets reward clear rules and redundancy, not reconstruction on the same unstable riverbanks. If Kathmandu wants foreign capital to keep financing hydropower — the country's most valuable export asset — it will need risk assessments, insurance markets and property protections that match the scale of what's now exposed, rather than rebuilding the same vulnerabilities and hoping the next flood waits its turn.
