|| Abstract - Nepal is known for its successful rural electrification efforts through community owned and managed standalone micro hydropower projects (MHP) that have helped transform its rural economy. Unfortunately, as soon as the national grid reaches a micro hydro catchment area, things start falling apart. For various reasons, people’s preference is the grid and eventually switch over from MHP which then lies idle and ultimately abandoned. A recent survey carried out by the Alternative Energy Promotion Centre (AEPC) shows that about 8% of the MHPs in Province 1 have shut down. The number of abandoned plant would be much larger if MHPs of less than 10kW capacity are also considered. Thus, the Government of Nepal came-up with the policy for grid interconnection of MHPs of less than 100kW capacity. This opportunity of transforming a standalone system to grid connected system has several advantages for both the utility grid and the MHP, the grid gets power injection near the load centers whereas MHP earns
additional revenue. The technological difference between grid interconnection of MHP and other hydropower projects shall be discussed in detail in the Nepalese context. A MATLAB simulation analysis is presented to demonstrate the technical viability of the interconnection in the 11kV feeder line. Moreover, financial and economic analysis of the grid interconnected systems is also discussed. This paper also focuses on how droop features of Electronic Load Controller (ELC) could have managed the proportional load sharing among the MHP plants if such ELC with droop features were available.