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"This paper describes a consultation process that took place in Nepal from January 2003 to July 2004 involving dam builders, dam managers and dam critics. It discusses the key findings of the review and reflects on the differences between dams built with domestic designs and funding that suffer no controversy and ongoing dam projects involving international agencies that are mired in dispute. The paper concludes that Nepal must continue with the deliberative process which characterised the period immediately after the WCD Report was released if it is to end the policy impasse that plagues the development of hydropower in the country. The government of Nepal, like the governments of its neighbours India and China, unequivocally rejected the recommendations of the World Commission on Dams (WCD) Report soon after its release in November 2000. Later, more considered reactions revealed more complex sentiments among Nepalis inasmuch that social activists welcomed the recommendations as valid and necessary, while the dam building community, including the official hydrocracy, held that they were impracticable. The then government, assessing that the business-as-usual dam building approach would face an impasse and not help meet Nepal???s growing need for water and electricity, concluded that the country could ill-afford to reject the WCD???s findings. It took a policy initiative in December 2002 to engage with the report more aggressively, comparing the WCD recommendations with Nepal???s own national laws, acts and policies in order to explore the contours of an alternative approach. Lessons from the consultative and inclusive global review effort that the WCD represented needed to be thoroughly internalised by Nepal so that no bad dams would be proposed for funding and only good dams built. The consultations of 2003-2004 revealed that many Nepali laws were already robust and did, in fact, incorporate the WCD recommendations adequately. A second cycle of consultations identified many second-generation problems, including those related to ensuring compliance, gaining public acceptance, recognising entitlements, sharing benefits and conducting comprehensive options assessments. The major limitation to Nepal???s ability to take up the WCD recommendations turned out to be less in the laws themselves and more in the implementation of, and compliance with, these laws. The findings of the two consultative reviews meant little to either subsequent governments of Nepal or to the international aid industry, despite the opportunity for change that the dramatic democratic movement of 2005/2006 offered ??? government hydrocracy and the political parties guiding it, as well as international donors, continued to favour the conventional model of dam building. Their silence about the review is inexplicable, especially in light of the flaws in, and controversy surrounding, the ADB-funded Kali Gandaki A and German-funded Middle Marsyangdi dams, both of which followed conventional practice. A new electricity act currently tabled in the parliament also fails to take into account many of the lessons that should have been learnt so easily from past mistakes."