‘Administrative reforms at NEA must’

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    NEA_BuldingKATHMANDU: The energy secretary has emphasised on the need for extensive financial and administrative reforms at Nepal Electricity Authority (NEA).

    “Until and unless NEA undertakes comprehensive financial restructuring to curb time and cost overrun of projects that keep piling up expenses, there is little hope that it can meet energy demand effectively,” said secretary of ministry of energy Bishwa Prakash Pandit during the 28th anniversary celebrations of NEA, here, today.

    “NEA’s inability to complete projects on time also calls attention to its weak administrative capacity,” added the energy secretary. He also pointed out that 80 per cent of the country’s energy sector comprises of NEA and its subsidiaries. “That is why the issues haunting NEA such as high production cost, unsustainable power purchase rate, rampant leakage and lack of financial discipline within the organisation have been affecting energy supply,” he added.

    “Moreover, there is a need to look comprehensively into policies to attract foreign direct investment which is indispensable to develop hydroelectricity in the country,” said Pandit, adding that issues such as power purchase agreement, investment security, land acquisition and deforestation have to be sorted out.

    NEA — the government authority responsible for energy supply across the country — recorded a loss in the last fiscal year. “Despite the significant increase in total revenue, NEA incurred a loss of Rs 4.5 billion in the last fiscal year,” said NEA managing director Rameshwor Yadav while presenting the financial statement of the last fiscal year.

    Last year, NEA had incurred a loss of more than Rs eight billion, but the hike in electricity rates from the beginning of the last fiscal year helped minimise its loss. NEA collected Rs 25.1 billion as revenue from the sale of electricity.

    Of the annual peak power demand for fiscal year 2012-13 that was estimated at 1094 MW, only 719.3 MW was supplied. “NEA’s hydro plants supplied 433 MW, NEA’s thermal plant provided 10 MW, 174 MW was supplied by independent power producers and the remaining 102 MW was imported from India,” said Yadav. At the end of fiscal year 2012-13, total number of consumers reached 2.59 million, which is a 14.34 per cent growth.

    “NEA needs to formulate and implement time bound programmes to ensure a balance between demand and supply,” expressed minister for energy Uma Kant Jha, who is also the chairman of NEA’s board. He also laid stress on completing transmission line projects as soon as possible and controlling spillage of electricity which have not only affected NEA’s financial health but Nepali citizens as well.

    Source : The Himalayan Times