Govt to pay attention to issues raised by private power producers

By A Staff Reporter,Kathmandu, Sept. 6: Minister for Energy, Water Resources and Irrigation Deepak Khadka has said that the ministry is serious about all the issues raised by Independent Power Producers’ Association, Nepal (IPPAN) for the development of hydropower sector.

He made this remark at the discussion with the representatives of the Independent Power Producers’ Association, Nepal at the ministry Thursday.

Khadka clarified that the proposed electricity bill was still under discussion in the parliament committee for listening to the voices of the private sector. 

“We have not tabled it to the parliament as we want to include the demands of private sector before being tabled in the parliament,” he said.

He said that an agreement has been reached to sell 10,000 MW to India, the export of 5,000 MW to Bangladesh is almost certain, and studies are being conducted to see if some electricity can be sold to China, and altogether, 20,000 MW of electricity can be sold.

Minister Khadka said that the same project would be 29 per cent more expensive as the machinery equipment used in maintenance is not given customs exemption.

“The issue of free electricity is also serious. Now we are getting 21.9 per cent free electricity from large projects made with foreign investment. Now, discussions are going on about those who will practice this even in small projects,” Energy Minister Khadka said. “Also, the cost of power projects is high, so free energy is not possible.”

He said that even if the license period is 30/35 years, a promoter can hardly run the project for only 27/28 years.

In the meeting, IPPAN president Ganesh Karki asked the Ministry of Energy, Water Resources and Irrigation to meet the demands of flood-affected hydropower projects immediately.

"Either the ministry should immediately address the demands of the flood-affected projects or if they cannot, it should raise their hands saying cannot," he said.

“The flood-affected projects submitted to the ministry with photo and video evidence, the ministry also made recommendations in two or four places. However, no one got relief, nothing worked from anywhere,” Karki said. 

Until two years ago, they used to get customs exemption for the maintenance of the project, now that system has also been removed by the Ministry of Finance that affected many projects, he said.

 “After the flood-affected projects have to spend 28 per cent extra money on spare parts, what will be the financial condition of the project? Especially the flood-affected projects have been greatly affected by this. They have not been able to reconstruct the project,” he said.

He expressed his dissatisfaction that the demand was not met even though he repeatedly appealed to the ministers, secretaries and joint secretaries of the ministry regarding not only the flood-affected projects but also various problems seen in the energy sector.

Due to natural calamities, shortage of explosives, disruption in import of goods due to Russia-Ukraine war, problems related to forest and land, no hydropower project can be completed within the specified time, he said.

President Karki said that the Power Purchase Agreement of projects with a capacity of 13,000 megawatts, which have been stalled for four years, should be opened, the hydrology penalty of all projects should be canceled due to the increasing problems of hydrology due to climate change.

The problems of forest and land reform should be resolved, and the roadmap of 28,500 megawatts should be advanced, he said.

Secretary at the Ministry of Energy, Water Resources and Irrigation Gopal Prasad Sigdel said that despite the recommendation of the Ministry of Energy, the Ministry of Finance did not give its consent because the issue of getting facilities such as customs exemptions for flood-affected projects was related to the Ministry of Finance. 

Sigdel claimed that the Ministry of Energy had also suggested in the budget to include the subject of customs exemption in maintenance, but the Ministry of Finance did not include it.

Senior energy expert at the Ministry of Energy, Water Resources and Irrigation Prabal Adhikari said that the construction of hydropower projects has been delayed due to lack of explosives, delay in financial management, and money could not be released despite financial management. 

He said that the government will not get rich by taking penalties and the ministry is positive about extending the Required Commercial Operation Date (RCOD) of hydropower project.