Currents of Conflict: Decoding the Legal Battle Between NEA and Industries in Nepal’s Power Landscape


In the heart of Kathmandu, a legal skirmish unfolds, one that unsettles the pillars of Nepal’s energy sector. The central characters are the Nepal Electricity Authority (NEA) and 11 companies, locked in a dispute over load shedding and the imposition of a penalty charge—a battle that thrusts the complexities of legal frameworks and policy implementation under the spotlight.

Power Struggles and Policy Changes

At the core of the dispute is the Power Purchase Agreement (PPA), a promise of a 24-hour power supply that the companies feel has been reneged. Post the 2072 BS (2015 AD) announcement ending load shedding, the NEA began imposing penalties on industries failing to consume electricity during allocated times. These penalties have imposed a considerable financial burden on the companies, a stress point that has now found its way to the chambers of the Supreme Court of Nepal.

Legal Crossroads and Business Confidence

The legal battle underscores the tension between companies’ expectation of a consistent power supply and NEA’s enforcement of its regulations. The case also raises broader questions about the judiciary’s role in resolving business issues and the impact of such disputes on industries’ confidence in the legal system. The business community and policy observers keenly await the Supreme Court’s decision, which could set a precedent for future disputes.

A High-Level Commission: A Potential Solution?

The Federation of Nepalese Chamber of Commerce and Industry (FNCCI) has proposed an intervention—a high-level empowered commission—to address the ongoing dispute. The Federation emphasizes a collaborative solution and urges the reconnection of power lines to prevent the potential closure of industries. However, as the legal proceedings continue, the NEA maintains its stance, severing power connections to non-compliant industries.

As the case unfolds, the validity of the NEA’s actions and the clarity of the power allocation and penalty system hang in the balance. The outcome will reverberate through the corridors of Nepal’s energy sector, potentially prompting a reevaluation of existing policies and practices. In this tussle between NEA and the industries, the Supreme Court’s judgement will be a watershed moment.


Source: BNN