The overall objective of REDP is to enhance rural livelihoods through the promotion of rural energy systems, specifically micro hydro, for the sustainable development and poverty alleviation.

To achieve the goal the program is targeted to install 125 to 150 new MH systems and provides service to about 30,000 new households.

By linking rural electrification with rural economic activities the programme ultimately impact positively on livelihood of the rural people. Produced electricity is used for lighting and cooking. In addition it is used to operate small scale cottage industries like water mills, grain mills and others. Additional income earns from these industries uplift livelihoods of rural households.

The programme objective complements the Tenth Plan goal of increasing hydroelectricity generation capacity to 800 MW by 2008 and rural electrification. It also fits in Nepal Country Strategy Paper (CSP) of the World Bank to increase domestic power supply and encourage private sector investment in power sector.